On-demand delivery within the Middle East and North Africa is estimated to attain $47 billion by 2030. In its largest and fastest-growing financial system, Egypt, many platforms function in several segments of e-commerce and logistics whereas serving companies and prospects.
Today, a kind of corporations, Yalla Fel Sekka (YFS), whose enterprise entails constructing a community of darkish shops and micro-warehouses throughout Egypt, has secured a $7 million Series A spherical.
YFS was based by Khashayar Mahdavi and Yasmine Abdel Karim in 2020, simply earlier than the pandemic struck and buyer behaviour shifted towards needing quicker deliveries due to pandemic-induced lockdowns.
With elevated buyer exercise, e-commerce corporations in North Africa sought to undertake trending fashions corresponding to fast commerce pioneered by Gopuff, Gorillas, and Flint. But in contrast to the West, Egypt’s e-commerce infrastructure isn’t prepared to accommodate the loopy demand and chaos that fast commerce brings.
It’s one of many causes Mahdavi and Abdel Karim began YFS. On a name with TechCrunch, the founders stated whereas figuring out a vital hole within the regional market: the necessity for near-instant deliveries, YFS has assembled a distributed community of small mini-warehouses and darkish shops, the place companies can retailer the products very shut to their prospects to guarantee fast deliveries.
Here’s how the platform works in a nutshell. It’s a B2B2C delivery logistics play the place the corporate integrates to the backend of a consumer, say a grocery store, so each time a buyer makes a web-based order, it picks up the order from a darkish retailer constructed to hold its purchasers’ merchandise and makes the delivery.
The platform additionally supplies a broad fleet and darkish retailer and micro-warehouse administration serving companies throughout a number of verticals, together with groceries, pharmacies and e-commerce.
“Being able to marry operational excellence and innovation with the technology to bring down your cost and have productivity gains is what sets us apart,” stated Khashayar Mahdavi, co-founder and chief technique officer to TechCrunch.
“And because of our economic and finance background, we’ve always been super focused on unit economics. So that’s what we’ve tried to achieve here, bringing innovation into this space with a focus on productivity and unit economics, and having this distributed logistics services to be able to serve our customers extremely quickly.”
YFS has a fleet of 1,000 energetic drivers of bikes and vans, with greater than 3,000 on a waitlist. These drivers make 10,000 orders each day, stated CEO Abdel Karim, including that the corporate’s gross merchandise quantity is rising at a month-to-month fee of 20% and buyer retention fee above 90%.
She additionally stated YFS has accomplished two million deliveries throughout 5 cities in Egypt — Cairo, Giza, Alexandria, Mansoura and Tanta — all of the whereas being gross margin optimistic, all in 18 months.
Millions of small companies in Egypt are simply coming on-line for the primary time. But for many of them, fulfilling orders stays a problem. YFS sees this phase as its subsequent batch of consumers, though it has predominantly served large purchasers corresponding to Spinneys, Vezeeta, Jumia and Noon.
“We are working on also serving multiple different businesses and even SMEs. We have a very advanced technology that will easily integrate with anyone. And that’s also a key advantage for us because we can help SMEs come online and help with their logistics arm while they focus on the product,” she stated.
The founders, who’ve financial backgrounds working in funding banking and oil and gasoline, acquired $2.5 million as seed cash from Flybridge Ventures and I Squared Capital. These traders backed the corporate once more on this spherical, together with lead investor DisruptAD, ADQ’s enterprise platform and Kuwait-based Kharafi Group.
YFS shall be deploying the brand new funding to develop its presence in cities throughout Egypt and the MENA area. Abdel Karim stated the corporate would additionally develop on its darkish retailer administration because it appears to be like to construct 20 to 40 darkish shops within the coming yr,
For Mahdavi, now that the corporate has a proof of idea, it’ll enter a strong progress part.
“What’s important to say is anything that has to do with quick commerce or instant delivery requires a new form of infrastructure on the ground to be close to your customers, technology, operations,” he stated. “All of that is radically different from the type of infrastructure we saw when we were not dealing with quick commerce. But now this is what it is all about for YFS, to become the main player and the leader of offering these logistic services for commerce.”