Nigerian-based digital retailer Jumia is offloading its fledgling travel business to South African online travel agency Travelstart.
Under the conditions of the distribution and commercial agreement, Travelstart will manage the operations of Jumia Travel’s online booking websites – including sales, fulfillment and customer service.
Financial terms were not disclosed.
“Twelve thousand customers travel with us daily,” says Stephan Ekbergh, CEO of Travelstart. “Being Jumia’s exclusive distribution partner will help even more travelers in Africa unlock high-quality online travel services.”
The new “partnership” is effective immediately, with visitors to Jumia Travel’s website redirected to Travelstart.
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Joe Falter, executive vice president for Jumia on-demand services, calls Travelstart “the perfect partner to build on the success Jumia Travel has achieved so far.
“We have a strong belief in the potential of the online travel industry and travel portals in Africa and have built a strong platform across our markets to address this opportunity.”
Jumia, which was Africa’s first unicorn, went public in the New York Stock Exchange in April 2019.
In its first year as a publicly traded company, Jumia was rocked by a series of scandals involving fraud and lawsuits.
The e-commerce company’s operating losses for the third quarter of 2019 reached €54.6 million ($60 million).
According to TechCabal, Jumia Travel experienced a burn rate of up to $22,000 each month just on marketing.
Falter says the new deal will allow Jumia to focus “on our growth and path to profitability as we reinvest our resources in our key markets, services and technology to create the best customer experience in Africa and allow Jumia to thrive.”