A newly founded joint venture (JV) between Swiss Ringier Africa AG and South African Silvertree Internet Holdings (Pty) Ltd, Ringier Africa Deals Group, announced that it has acquired Nigeria’s leading online discount and shopping store, DealDey for an undisclosed amount. This deal represents a significant turning point in investing in Africa’s e-commerce space as the JV partners bring over ten years of experience in e-commerce on board. It also reveals renewed confidence in the buoyant, fast-paced e-commerce sector.
“The DealDey team is excited about joining forces with the newly-formed Ringier Africa Deals Group. It offers great opportunities as DealDey brings a wealth of experience in technology, merchant management and consumer behaviour in Nigeria – and we will be leveraging the Ringier Africa portfolio in marketing, classifieds and media as well as Silvertree’s e-commerce expertise towards supporting the sustainable growth of the group,” said Kehinde Oriola & Etop Ikpe, DealDey Co-CEOs.
Since the beginning of this year, several investors have come into Nigeria to invest in its e-commerce business. This development has been attributed to the rapid growth of digital technology on the continent, including e-commerce and mobile payments.
Last month, AXA announced its partnership with one of Nigeria’s leading e-commerce sites, Jumia, in order to provide insurance coverage for Nigerians. Earlier this year, the Silvertree group, which is a member of the JV, announced that it was going to invest up to $10million additional dollars in African entrepreneurs and e-commerce enterprises.
This acquisition is a welcome development for DealDey, which was already losing its grip on the Nigerian e-commerce space. According to a poll by NOI polls, public awareness of the DealDey platform is at about 6 percent and this is poor when compared to other platforms such as Jiji.com, which is a more recent brand in the industry.
According to industry watchers, since the Founder of DealDey, Simdul Shagaya, left to join the Konga team, the operations of the platform have not been the same. Last year, the company laid off about 60 percent of its staff which, according to the co-founder Etop Ikpe, was in order for the company to meet its organisational objectives. Just last month, merchants on its platform complained about DealDey owing them millions of Naira after selling their products. When the platform was contacted, they said they have had issues with their payment platform since January.
What we know about Ringier Africa and Silvertree:
Silvertree Capital is particularly interested in investing in tech startups from South Africa, Nigeria and Kenya and it is set to invest in new talented online companies to join its fast expanding owner-operator portfolio, this year.
Silvertree Internet Holdings had a 330 percent per annum growth in 2015, this is the first time it is experiencing such growth since it began operations in 2013. This was made possible through its e-commerce platforms – Click n Compare, Faithful to Nature, Cyber Cellar, HealthCart and PriceCheck. Through activity on these platforms, Silvertree Internet Holdings recorded a 50 percent increase from 2014 by reaching 25 million unique consumers in Africa in 2015.
Ringier Africa’s mother company, Ringier AG, runs DeinDeal and Geschenkidee, the two biggest online deals and gifting platforms in Switzerland respectively.