Giza-based startup Cartona, an e-commerce platform digitalizing the FMCG trade market, has reportedly secured $12 million in its Series A funding round.
The round was led by VC firm Silicon Badia and joined by Sunny Side Ventures, Arab Bank Accelerator, and the impact investment fund SANAD Fund for MSME, which focuses on MSMEs in North and Middle East Africa.
Existing investors Kepple Ventures and Global Ventures also participated in the round.
According to the firm’s statement, the funding will help the startup further expand in Egypt and grow its product, services, and technology, while exploring new verticals.
Mahmoud Talaat, CEO of Cartona, believes that the firm will reach profitability with the investment.
He said that the firm would be utilizing the money towards sustainable growth instead of rapid expansion, ensuring positive unit economics in each city.
With Cartona, buyers can order inventory from a network of selected sellers with an app that offers a communication tool for promotions and a dashboard for market insights.
The startup works with wholesalers, distributors, FMCG producers, and mom-and-pop stores in the country. It runs an asset-light marketplace where not a single product or vehicle is owned by it.
Mahmoud Abdel-Fattah, CTO of Cartona, stated that Cartona stands out in the market by integrating BNPL services into its marketplace platform without a third-party provider.
By implementing this approach, small businesses can repay their loans whenever they have a product shipment, unlike on other platforms where they are bound to pay their loans monthly with interest.
Currently, Cartona lends out its balance sheet, but expects to get some venture debt and credit lines soon from its partners by January 2023.
Namek T. Zu’bi, founding managing partner, Silicon Badia, said that Cartona’s asset-light approach has enabled investment firms, including itself to enter the B2B retail market and efficiently serve several marketplace participants.
Talaat revealed that the firm currently serves over 60,000 merchants, 1,500 wholesalers and distributors, and 200 FMVG businesses, including Henkel and Unilever. It has processed over 1 million transactions and has an E£2.3 billion ($121 million) annualized gross merchandise value.