Zinox acquires Konga


I saw this story first on LIB (don’t judge me) and thought it was a joke. The most surprising aspect of this news is its secrecy. I remember seeing Interswitch bandied as a possible suitor but never in a million years imagined Yudala would have the wherewithal to pursue a much larger competitor.

This is great news for Kinnevik et al - they get to cut their losses and move on - but I can’t say the same for Zinox. They will still have to burn a lot of cash before they can steady the Konga ship. Going by what they’ve achieved with Yudala - good but not great, 6/10 at best - it’s hard to believe that they can run Konga much better than the previous owners. I just hope they don’t make the grave mistake of integrating the Konga brand into Yudala by redirecting konga.com traffic to yudala.com. That will put off a lot of Konga users.

Maybe they’re hoping they can hold on to it long enough till Amazon or Alibaba comes knocking. That will be a really long wait. I know about Mr Ekeh’s wealth first hand and I’m sure he has the financial muscle to last the marathon but it will still be a painful marathon nonetheless. Oh well.

Definitely a historic moment for e-commerce and the Nigerian tech space.


I remember amazon and co had to struggle for many years before they start making profits. same also with alibaba. I think konga giveup too early.


i am sure zinox used bank loans to finance this deal,i hope they dont run down the site


Bank loans for 10M$ :smile:


Zinox can leverage equity or assets to secure a line of credit or obtain a secured business loan for the deal.
every big business do that

they can either do loans or debt financing for $10m,it is up to them,i dont know their strategy


Why is the means of financing relevant ? You obviously don’t know anything about Nigerian banks. None of them would touch a startup with a barge pole.

This $10m figure is an unconfirmed rumor. If it’s correct it doesn’t surprise me that Leo Stan could pay that in cash.


Zinox is not a startup but a real company with lot of credibility and history with Nigerian banks.

from what i understand yadula is part of zinox,so they have good experience in running an eCommerce site

konga starts a new beginning with new owners,wish them goodluck


I have an inclination to believe that the $10 million figure is true. Remember I told you guys some time back that all these acquisitions in Africa are like Hail Mary deals to save face for the owners. Nobody gets rich in them. At $10m exit after raising $75m Sim will probably get peanuts if anything. Anyway I will use my connections to find out the details and report here. Meanwhile fellow Radarians I will tell you one again, forget about Silicon Valley model in Africa. Build companies with modest revenue but good cash flow which can sustain a good lifestyle. That is a more practical goal


I don’t even know what to comment. To me the recession is killing everything.


Interestingly enough, the Zinox group owns Yudala as well. i foresee a merger


that’s exactly what’s happening nah!


Odd that TechCabal isn’t following this story, I think Techpoint is doing a good job at that.
And someone said the Nigerian tech-space was not exciting :sleeping:
2018 looking lit, no?


Techcabal is dead, long live the cabals


You are very correct. A lot of startups around here are vanity projects that do not have solid products.
Better to do a normal business with modest revenue and good cashflow like you said.
Like Otunba Akin Alabi is doing.
All this exit thing doesn’t work around here. I have read the history of Mark Cuban and he was simply lucky somebody wanted to buy what he had to sell.


Great point.


Perhaps the driver for the acquisition is KongaPay. There are significant synergies to be gained from the technology and brand goodwill.


I just noticed that I don’t see Konga on Google Ads anymore. It seems Konga turned it off in December (perhaps because they knew a sale was imminent?) and they’re now witnessing a decline in traffic.

This is a site that was usually steady in the top 20. It’s ridiculous that after FIVE years of aggressive marketing spend, the site can’t organically sustain its traffic levels. I highly doubt Zinox will match the marketing spend of Naspers et al; this decline may continue.

This says a lot about the true state of e-commerce in Nigeria today. We’re lightyears away from any sort of eureka moment. Time for investors to put their money in another sector.