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Jiji Acquires Cars45 as Part of Its Expansion and Diversification

June 29, 2021

Jiji.com, Africa’s leading classified marketplace has acquired Cars45, Nigeria’s leading automotive trading platform in a bid to diversify its offerings and expand its business across sectors. According to co-founder Vladimir Mnogoletniy, Jiji is looking for opportunities outside of the classifieds business.

Mnogoletniy said that “In terms of classifieds, we’re looking at opportunities,” he explained, “but we are already a leader in Africa, so I think there’s very limited space for whom to acquire. However, we’re primarily interested in deals like Cars45, where we bring our leadership positions from classifieds and acquire very close business models that give us exposure to the transactional marketplace. So for us, a major interest will be to acquire adjacent business models.”

He also pointed out that vehicle listing is the second most popular category on Jiji behind real estate. The platform’s total listing is worth over $10 billion, with real estate ($7 billion) and vehicles ($3 billion) making up the bulk of it.

“We have leading positions in all markets we’re present in and are definitely the classifieds leader in the region. Also, we are probably the largest e-commerce company in Africa by GMV,” he continued.

This acquisition will enable Cars45 to grow the vehicles category. Cars45 will merge its operations in its three African markets – Nigeria, Ghana and Kenya, to increase efficiency. It will also give Jiji an upper hand in consolidating its position as the classifieds marketplace leader.

Over the years, Jiji has been plagued by trust and safety issues from users. The acquisition of Cars45 will help reduce this risk, as it offers a different car buying and selling experience via a transactional marketplace model.

Jiji will also leverage Cars45’s network of inspection centres where cars are inspected by more than 200 parameters. Unlike a classifieds marketplace where checks are inadequately carried out, transactional models employed by platforms like Cars45 ensure quality checks and detailed reports on a car’s condition with various databases.

For Cars45, it has come a long way from first being owned by Frontier Cars Group (FCG) and then was acquired by OLX Group and now Jiji. This poses questions around whether the integration with its new owner Jiji will work out fine.

With Jiji’s new disposition towards looking outside of its normal classified business to expand its operations, I wonder whether another acquisition is around the corner? Considering the platform’s top listing categories, It could be a real estate company or another vehicle trading platform.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Series Of Acquisitions: Why Nigerian Car Marketplace, Cars45, Was Acquired Again By Jiji

Nigeria car-listing market marketplace, Cars45, appears to be having a field day at the hands of acquirers. Barely a year after it was acquired by OLX Group, the company’s ownership has, once again, changed hands. The latest buyer is Jiji, one of Africa’s largest marketplaces for classifieds which has announced its acquisition of the transactional car marketplace for an undisclosed amount.

“We are proud to have built a trusted buying and selling experience in autos. It makes sense to combine online and offline expertise. Merging with Jiji is aimed at creating a new kind of automotive retail experience for users in Africa. We are confident of jointly building an African Champion in the O2O Automotive Sector. Together we look forward to making transactions transparent and convenient for our customers, dealers and franchisees across all our current and future markets,” Soumobroto Ganguly, CEO of Cars45, said.
Read also:How African Startup Founders Handled Exit From Startups They Founded

A Timeline Of Cars45’s Winding Journey To Acquisitions

In 2017, Frontier Car Group (FCG), a Berlin-based company that builds used-car marketplaces with a focus on emerging markets, invested $5 million in Cars45 which was founded in 2016.

As a result, FCG became the largest stakeholder and parent company in the Nigerian automobile industry.

However in 2020, OLX Group purchased Cars45 from FCG through its OLX Autos brand.

FCG secured $400 million from OLX Group (a division of Prosus, the Netherlands-based separate tech holdings of South African tech giant Naspers) by virtue of the acquisition. At the time of the acquisition by OLX Group, FCG was valued at $700 million.

OLX Autos, however, shuttered FCG’s Berlin operations in March this year, but maintained Cars45 and two other brands: CarFirst in Pakistan and WeBuyAnyCar in the United States.

The announcement in March claimed that OLX Autos’ new concentration was on Asia and Latin America, implying that Cars45 would be sold.

With the latest announcement, it appears that OLX Group has abandoned most of its African operations, with the exception of South Africa.

As The Acquisition Galore Continues For Cars45, Why Is It Important For Jiji?

On why the acquisition was important, co-founder and board member of Jiji Vladimir Mnogoletniy noted that vehicles are the second-most popular category on Jiji. He says that the category has over $3 billion in listings out of a total of over $10 billion on the site (real estate commands about $7 billion).

“We have leading positions in all markets we’re present in and are definitely the classifieds leader in the region. Also, we are probably the largest e-commerce company in Africa by GMV,” he said.

As a result of the purchase, Cars45 will be able to expand its car category. Furthermore, Cars45 will integrate its activities in Nigeria (main market), Ghana, and Kenya with Jiji in order to strengthen its position in the classifieds industry.

In addition, by acquiring Cars45, Jiji will be able to address trust and safety problems that have plagued the company in the past, as well as provide a unique car-buying and selling experience through its transactional marketplace model. As a result of Jiji’s supremacy in online classifieds, Cars45 users will profit, a statement from the company noted.

“We will integrate this into one company because this acquisition has a lot of benefits for both. It’s a very common practice when marketplace and transactional business models work together as one project,” co-founder and CEO Anton Volyansky said regarding the integration of both platforms. “For instance, a seller of a car, it’s convenient to sell both ways via a marketplace or auction model. So, it would be like a seamless process for selling the car.”
Read also:Nigerian Fintech Company, Paystack, Plans Entry Into Côte d’Ivoire

Cars45’s primary value, according to Jiji CFO David Ojo, is its network of inspection centers, where automobiles are evaluated for more than 200 characteristics. Unlike a classifieds marketplace where quality checks are lacking, transactional models used by platforms like Cars45 provide quality checks and thorough information on a car’s condition using several databases.

why Jiji acquired Cars45 why Jiji acquired Cars45

Why Many African Early-Stage Startups Fail To Secure VC Funding

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning write

Nigerian Startup Jiji Raises $21M For Its African Online Classifieds Business

December 10, 2019

Jiji, the Pan-African digital classifieds company, seems to be wrapping up this year big time for its online classified business. The Nigeria based venture, co-founded by Ukrainian entrepreneur Vladimir Mnogoletniy has just secured $21 million in Series C and C-1 financing from six investors, led by Knuru Capital to further grow its business.

“We are the largest marketplace in Africa where people can sell pretty much anything…We are like a combination of eBay and Craigslist for Africa,” Jiji’s co-founder Vladimir Mnogoletniy said in an interview.

Here Is The Deal

On the list of Jiji’s investors are the Saudi-based VC Knuru Capital, among six other investors.
With this latest round of funding, the Jiji’s total capital raised from 2014 to 2019 comes to $50 million.
Jiji is planning to use the latest investment toward initiatives to increase the overall number of buyers, sellers and transactions on its site.
The company also hopes to upgrade the platform to create more listings and faster matching in the area of real-estate, according to Mnogoletniy.
For the moment, Jiji doesn’t have plans for country expansion or company purchases. “Maybe at some point we will consider more acquisitions, but for the time being we’d like to focus on those five markets,” Mnogoletniy said — referring to Jiji’s existing African country presence.

Why The Investors Invested

Although Knuru Capital, the lead investor is new to the VC landscape, the Fund this year led a $2.3 million Series C investment in the Dubai-based startup Luxury Closet, one of the first investments.

‘‘Our purpose is to help fund the growth of the world’s most promising digital disruptors,” said Alain Dib, CEO of Knuru Capital.

“We back companies with the clear potential to become true global players and [with Jiji] selling globally perfectly matching this ambition,” adds Bassim Haidar, Chairman of Knuru Capital.

A Look At What Jiji Does

Buyers and sellers on Jiji, use the platform to transact purchases from real estate to car sales.

The classifieds site, so far, has two million listings on its Africa platforms and hit eight million unique monthly users in 2018, per company stats.

Jiji sees an addressable market of 400 million people across its operating countries, according to Mnogoletniy. The venture bought up one of its competitors in April this year, when it acquired the assets of Naspers owned online marketplace OLX in Nigeria, Ghana, Kenya, Tanzania, and Uganda.

Jiji’s top three categories for revenues and listings (in order) are vehicle sales, real estate, and electronics sales (namely mobile phones).

The Nigeria based venture, co-founded by Ukrainian entrepreneur Vladimir Mnogoletniy, has an East to West presence that includes Ghana, Uganda, Tanzania, and Kenya.

With the large consumer base and volume of transactional activity on its platform, Jiji could layer on services, such as finance and payments.

“We’ve had a lot of discussions about adding segments other than our main business. We decided that for the next three to five years, we should be laser focused on our core business — to be the largest marketplace in Africa for buying and selling to over 400 million people,” Mnogoletniy said.

The company faces an improving commercial environment for its goals, with Africa registering some of the fastest growth in the world for smartphone adoption and internet penetration.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world