Egyptian B2B e-commerce platform Cartona, which connects fast-moving consumer goods (FMCG) suppliers and wholesalers with retailers, has recently raised $8.1 million in a Series A extension, bringing its total Series A to $20.1 million. The round was led by Egyptian VC firm Algebra Ventures, with participation from existing investors Silicon Badia, SANAD Fund for MSME, Camel Ventures, and GlobalCorp.
Founded by Mahmoud Talaat and Mahmoud Abdel-Fattah, Cartona has managed to maintain its growth and approach full EBITDA profitability despite the challenges faced by other B2B startups in Africa. The platform’s asset-light model, which focuses on technology, embedded finance, and other product enhancements, has been a significant factor in its success.
Cartona’s annualized gross merchandise volume (GMV) is about EGP 10 billion ($210 million), up from EGP 2.3 billion ($120 million) in 2022. The platform serves over 180,000 retailers from both FMCG and HORECA (hotel, restaurant, and cafe/catering) verticals, who manage over 40,000 SKUs on Cartona.
The platform’s expansion into the HORECA vertical, launched last year, represents a small part of Cartona’s business but has double the blended take rates and average order value compared to its FMCG customers. Talaat expects the vertical to contribute 15% of the startup’s GMV by the end of the year.
Cartona’s asset-light model has allowed it to partner with existing suppliers, wholesalers, and distributors in Egypt’s informal market, making them more efficient with the tech tools provided by the platform. Over 30-40% of Cartona’s partner suppliers’ sales now come through the platform, and when a platform contributes a significant margin to suppliers, they actively support its growth.
The Egyptian market presents a massive opportunity for B2B e-commerce platforms, with over 400,000 shops and thousands of international and local brands, and the sector growing annually by 8%. However, the market is still predominantly offline, and the education and penetration of B2B e-commerce is in its early stages. Despite the challenges, Talaat believes it’s only a matter of time before B2B e-commerce platforms like Cartona create significant value for stakeholders in the supply chain and investors backing them.
