EGYPT – Cartona, a B2B platform connecting retailers to manufacturers and wholesalers has raised US$4.5 million in a Pre-Series A funding round.
The fundraising was led by Global Ventures, a Dubai-based, international venture capital firm, with participation from Kepple Africa Ventures, T5 Ventures, and a group of angel investors.
Cartona will use the clinched investment to deepen the capabilities of its technology to further enhance the user experience and introduce embedded finance within the product and order cycle.
Founded in August 2020, the startup solves the supply-chain and operational challenges for the fast-moving consumer goods industry (FMCG) by digitizing the traditional, predominantly offline, trade market.
It offers an asset-light marketplace that enables grocery retailers to order their store needs digitally from a curated network of sellers.
On the platform, grocery retailers can get orders from a curated network of sellers. The company says this way, it can provide visibility through real-time price comparisons and clarity on delivery times.
Also, FMCGs and suppliers can optimize their go-to-market execution through the use of data and analytics. Cartona tops it off by providing embedded finance and access to credit to retailers and suppliers.
The company makes money through all these processes. It takes a commission on orders made, charges suppliers for running advertising to merchants (since they compete for the latter’s attention), and provides market insights on buyer behavior, price competition and market share.
“Small and medium retailers deserve the opportunity to operate their businesses efficiently while delivering growth simultaneously. To do so, they need access to credit, inventory and payment services.
“We are dedicated to empowering the B2B ecosystem through technology and supply chain innovation. Cartona is committed to building a strong network of digitally connected retailers that have better control over their businesses through running a seamless daily operation,” Mahmoud Talaat, CEO and Co-founder of Cartona, said.
Since its inception, Cartona has acquired over 30,000 users in Cairo and Alexandria alone and processed over 400,000 delivered orders with an annualized gross merchandise value of EGP 1 billion.
The company works with 100 FMCG companies, 1,000 distributors, and wholesalers, offering consumers over 10,000 products listed on its platform including dry, fresh, and frozen food.
Historically, Egyptian retailers have had limited access to suppliers, as well as very limited visibility on rapidly changing market prices, available trade offers, and have been dependent on traditional logistical capabilities.
Cartona is designed to eliminate inefficiencies across the value chain, from buyers to sellers, by providing enhanced visibility through real-time price comparisons, and superior clarity on delivery times, while allowing FMCGs and suppliers to optimize their go-to-market execution through the use of data and analytics.
“The trade market is one of the most sophisticated, yet characterised by multiple critical inefficiencies across the value chain. Cartona’s asset-light approach tackles those inefficiencies by optimising the trade process in unique ways, and does so with minimal capital spent.
“The company has already demonstrated consistently stellar growth over the past year. We are thrilled to partner with the company’s solid, highly capable and experienced founding team on their third entrepreneurial journey,” Basil Moftah, General Partner at Global Ventures, said.
Cartona’s business and revenue model is similar to other companies in this space, but the main difference lies in whether they own assets or not.
Taking a look at the players in Egypt, for instance, MaxAB operates its warehouses and fleets; Capiter uses a hybrid model in which it rents these assets and owns inventory when dealing with high-turnover products. But Cartona solely manages an asset-light model.
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