While living in Kenya in mid-1990s, Tracey Turner experienced what life was like for low-income families and how they manage their cash flow and still have access to basic goods. So when she launched Copia Global, it is this market segment that she had in mind.
“The retail sector in Kenya is very efficient with shops ubiquitous with limited product selection, high prices and when mobile phone penetration peaked even in the most rural communities, Copia Global was born,” opens Ms Turner, co-founder and chairperson of Copia Global, a B2C e-commerce platform.
She says that she and the company’s co-founder built the service piggy, banking on the existing informal retail sector kiosks and dukas to bring to them a whole variety of products and services that could better the lives of lower-income consumers- who mostly live away from cities.
She says the vision was to empower the consumer to allow them to act in the global economy. They began with an offline model of providing paper-based catalogues, which the duka owners would share with the customers and make orders via text message and deliveries done.
“The smartphone era has now changed our relationship with customers as they are now aware of our products, special deals which enable them save money, opening a totally whole new world of services we can provide,” Ms Turner says.
The entrepreneur adds that the first thing they did was to build relationships with duka owners who are well-known in their communities. They then became Copia Global agents and with Copia Global branding at the front of the shops, customers would inquire what Copia was all about and that created awareness about the services and Copia Global products.
She says that they couldn’t find a similar model anywhere in the world but their conviction was that just because they are in the lower income category, they still on aggregate spend more than $1 trillion annually across the continent.
“That’s a huge market opportunity, so the very first thing we needed to do was to establish trust because, in Kenya and Africa in general, you have to start from a place of distrust before earning consumer trust,” she explains.
A bumpy start
She says that at the beginning, they designed and built a large app for consumers to make orders online through their phones - rolled it out to about 12 people but they had no idea how to use it.
“We totally flopped and stopped, went back to the drawing board, threw away what we had built and started over using the same 12 people, to give us feedback on what kind of e-commerce was intuitive for them,” she recalls.
They had to completely redesign the app to be user-friendly.
Entrepreneurial struggles
Ms Turner points out that the bigger picture is that African entrepreneurs get one percent of global venture capital dollars each year, yet it is a huge continent of more than one billion people with massive opportunities for innovation.
“There are lots of expectations that African entrepreneurs need to accomplish on a very limited amount of capital,” she says.
She goes on to add that things like Covid-19, global supply chain disruptions, economic recessions, and downturns in capital markets are headwinds for entrepreneurs.
She adds that it is very difficult to bring Amazon-like models to Africa and expect to succeed. One has to think differently about the infrastructure, customer demographics, products and how deliveries can work in a sustainable and profitable way.
“All of these things need to be thought through properly and addressed in ways that are different from Western markets,” she advises, adding that she is confident that businesses that have been started across the continent in the e-commerce space have massive opportunities to succeed.
Ms Turner reminds fellow entrepreneurs that it takes time to build a successful e-commerce business.
She cites the example of Amazon which took more than a decade and a few billion dollars before it could break even while African businesses are expected to do it in a much shorter time frame with much less capital.
Efficient delivery system
To achieve their goal of ensuring that customers receive their orders within the shortest time possible, Ms Turner says they succeeded in building an efficient delivery system because they believed that if you don’t have a successful customer experience, you won’t get off the ground.
“We had to make heavy investment in building that delivery system to reach the majority of the population in more populated areas of Kenya. We have 36,000 delivery points across the country and we promised we would deliver within three days to any of those points,” she affirms.
Copia Global staff at Tatu City when then US ambassador to Kenya Kyle McCarter toured the investment. FILE PHOTO | NMG
One interesting thing is that about 80 percent of the agents are women.
She says that the investment was costly and took time to build but it now works and they are able to deliver 95 percent on time.
“We have a huge fulfilment centre at Tatu City that serves the entire country, with 12 smaller overnight stations with hundreds of delivery trucks to 36,000 delivery points.”
Uganda exit and negative working capital model
In April 2023, the e-commerce platform announced its exit from Uganda market despite the huge opportunity in the landlocked East African nation.
“Copia has a pan-African ambition and we have looked at every market across the continent. That’s our vision but in this capital markets environment, it’s very clear that there is very little interest in businesses that are expanding into multiple markets at this time,” explains Ms Turner.
She says that the sentiment is more of staying in the market that you are in and being as profitable as you can in those existing markets.
“We had started our international expansion and launched Uganda but the capital markets said they were not going to fund Copia into new markets to profitability at this time.”
“It was a sad day because Uganda was a fantastic market with huge opportunity, growing rapidly and there was no reason why Copia Global couldn’t be successful, and build profitable business serving the Uganda people but the capital market in 2022 was not going to support that,” she reveals.
Picking a competent board
Some companies struggle with the decision of whether to bring in independent board members or retain control among the founders or family.
“There are different models out there. Some people prefer family controlled which is very important for them but my priority was to build the biggest and most successful business serving as many people as possible and that meant bringing in the greatest minds I could find,” says Tracey.
Ms Turner says she wanted to surround Copia with advisors with leadership skills that would translate into the most successful company and bringing on board people like seasoned banker Isaac Awuondo made sense and there was no question that was the right path for Copia Global.
“The most valuable thing I can do for Copia Global is to bring the best, brightest most intelligent leaders I can, who are far much better and smarter than I am at their role in the business,” she adds.
She says starting her first company before launching Copia, she had no idea what she was doing, - worked all the time and didn’t know how best to channel her time but she has since learnt how to be efficient with her time.
Attracting investors and lessons
For companies and entrepreneurs intending to fundraise and attract investors for capital, Ms Turner says that you have to articulate a powerful moving story.
“You need to communicate a story that resonates with investors,” she advises.
She adds that the second thing you need is to know your numbers inside out and be on top of your numbers.
“Thirdly, you have to network - constantly meeting people and asking for an introduction to someone else and every 20, 30 or 50 investors you meet, one will be convinced to invest in your company.”
She concludes by saying that the fourth pillar is persistence and that it is really hard to get investors’ attention because they are bombarded and to rise to their top to-do list means you have to be super persistent.
Ms Turner says Copia Global has a track record of doubling growth every year and doesn’t see why that would change any time soon.
