MarketForce to enter social commerce after downsizing operations
B2B eCommerce platform MarketForce has streamlined its operations by reducing its presence in five African markets, specifically Tanzania, Nigeria, and Rwanda. The company is now focusing its efforts on Kenya and Uganda and has postponed its earlier plan to collaborate with Cellulant for expansion into Ethiopia and Ghana.
MarketForce's super-app, known as RejaReja, which facilitates informal retailers in ordering fast-moving consumer goods (FMCGs) directly from distributors and manufacturers while providing access to financing, will only be available in Uganda. The service has been discontinued in Kenya, Nigeria, Rwanda, and Tanzania.
Kenya will continue to serve as the company's headquarters, and it will also be the launchpad for Chpter, a social commerce spinoff created by MarketForce. Chpter aims to assist merchants in translating social media interactions into increased sales. Tesh Mbaabu, who will serve as co-founder and CEO of both MarketForce and Chpter, confirmed these strategic changes.
Key Takeaways
MarketForce encountered significant challenges when certain venture capital firms that had initially committed funds for a $40 million Series A debt-funding round backed out of the deal. This unexpected setback compelled the startup to seek new investors, presenting it with fundraising difficulties. Consequently, MarketForce was compelled to scale back its growth ambitions and downsize its operations. Faced with financial constraints and the prevailing market conditions that have compelled companies to shift away from a "growth-at-all-costs" approach, MarketForce strategically allocated its resources toward building a profitable business. The company's new focus involves meeting strong demand in areas with high density while discontinuing operations in regions that are not yielding profits. This shift in strategy aims to ensure the sustainability and profitability of the business. Meanwhile, its decision to enter social commerce points to a growing sub-sector with a $28 billion opportunity.
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