Wasoko and MaxAB complete merger to create Africa’s largest B2B digital platform

Wasoko and MaxAB, two pioneering forces in Africa’s B2B e-commerce sector, have announced the completion of the continent’s largest-ever tech merger. Conducted as an all-stock transaction, the merger creates a unified Pan-African platform connecting informal retailers to essential digital and physical goods. This move represents a significant evolution from their origins as e-commerce companies into a diverse digital services ecosystem.

The combined vision: expanding beyond eCommerce

By leveraging their extensive market knowledge and operations across Kenya, Tanzania, Rwanda, Egypt, and Morocco, the newly combined entity brings together an unparalleled network of over 450,000 informal retailers, reaching more than 65 million consumers across Africa. The merger positions Wasoko and MaxAB better to serve the $600 billion African informal retail market, building a multi-vertical platform for essential services.

In a strategic shift, the newly formed entity is not just doubling down on e-commerce but diversifying its offerings to include AI-powered fintech solutions like credit financing, digital services, and payment processing—all integrated within a single app. These fintech services have rapidly grown, especially in Egypt, the largest market for the combined entity. Digital services alone have generated over $180 million in annualized sales to seven million consumers through 40,000 retailers.

The impact of the merger is particularly evident in the credit financing vertical, which disbursed over $20 million in the past year, with a repayment rate of over 99%. This achievement is a testament to the effectiveness of the credit model in empowering informal retailers, allowing them to grow their businesses without traditional banking constraints. With fintech revenue projected to double year-on-year by December 2024, the merger positions the entity as a key player in Africa’s evolving financial services landscape.

Leading the charge in Africa’s digital revolution

Wasoko and MaxAB’s leadership team features a dynamic duo—Daniel Yu, CEO of Wasoko, and Belal El-Megharbel, CEO of MaxAB—who will now serve as Co-CEOs. They will guide the company alongside existing investors such as Silver Lake, Tiger Global, and British International Investment. Their goal is to build a foundational infrastructure that will empower future tech companies across Africa.

“Building on burgeoning trade ties between North and East Africa, this deal unifies the leading B2B players in both regions, establishing an unmatched platform for serving communities across the continent,” said Daniel Yu. “Through our integrated technology stack, our expanded Pan-African reach uniquely positions us to offer the best products and services from across Africa at maximum accessibility and affordability.”

The merger represents a turning point for African tech, demonstrating the potential of homegrown tech giants to lead the charge in innovation. Belal El-Megharbel echoed this sentiment, emphasizing that “this merger proves that massive, world-class tech companies can be built in Africa for Africa.” Their shared vision is to foster a mature, thriving ecosystem that will pave the way for other companies to unlock Africa’s vast economic potential.

Leveraging data for informed growth

The merged company has wasted no time in integrating its technologies, successfully combining both tech stacks and operations in under 60 days. This integration has produced remarkable outcomes, leveraging millions of localized data points from each market to optimize pricing, demand prediction, and route efficiency. This data-driven approach supports the expansion into fintech services, which has already begun overtaking core e-commerce operations in terms of profitability.

Driving growth through private label and cross-border trade

In addition to fintech expansion, the merged entity’s e-commerce arm is thriving, with operations becoming profitable in the majority of markets. The company’s own private label products, which include essential goods like cooking oil, rice, and tomato paste, now account for over 10% of total e-commerce sales. These products are part of a broader cross-border sourcing initiative aimed at increasing intra-African trade, enhancing efficiency, and reducing costs for retailers.

Wasoko and MaxAB — A new era for Africa’s informal retail sector
With over 4,000 employees, Wasoko and MaxAB are on a mission to reshape the informal retail sector in Africa. The success of this merger sets a precedent for other tech companies, proving that large-scale tech enterprises can thrive on the continent. By expanding beyond e-commerce into fintech and other digital services, Wasoko and MaxAB are creating an ecosystem where informal retailers can grow and thrive.

This landmark merger of Wasoko and MaxAB underscores the transformative power of technology and the potential of Africa’s informal economy to drive sustainable economic growth. The journey from e-commerce startups to a Pan-African multi-vertical powerhouse is a testament to the possibilities for African businesses when they combine innovative solutions with the drive to make a difference.

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