Bike-hailing startup SafeBoda has confirmed that it is exiting the Nigeria because the industry is not yet economically viable.
The startup had its early beginnings in Uganda, where it set out to take the poorly monitored boda-boda business online. Within a year, the company had entered Kenya and in 2019, it began operating in Nigeria, Ibadan.
It is curious that it had stayed this long in Nigeria, given the government’s drastic 2020 policy that saw other bike-hailing businesses like Gokada, MaxNG, ORide, and so on, go under. SafeBoda had also swiftly exited Kenya in 2020 but held on to its Nigerian business.
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Like other bike-hailing services, SafeBoda went hybrid, doubling as a delivery company. As TechPoint Africa claims, the company had even begun a car-hailing service, called SafeCar, in Nigeria too.
Yet, the writing on the wall should have been clearer to the its leaders. With 3 million rides and 50,000 deliveries split between 10,000 riders and 100,000 passengers, the financial situation of its Nigerian operation was not really encouraging.
“In Nigeria, the core unit economics of the okada business were very challenging, they were positive, but the margins were too thin,” SafeBoda CEO Alastair Sussock had said. “Uganda generates significant cash flow and is moving quickly to full profitability. The unit value of our services are significantly higher than Nigeria and our brand has deep roots… Uganda is a huge market with over 1.5 million [boda] rides happening every day in greater Kampala alone.”
It is not clear if it would also be quitting its car-hailing business too in the West African nation. For now, SafeBoda is doubling down on its operation in its home country, Uganda. Recall that in December 2021, the startup received funding from Google’s US$50 million Africa Investment Fund.
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