SAB Restructures, Shifts Focus to Global Trade
African E-commerce Startup Adjusts to Evolving Market
African B2B e-commerce firm SAB has reduced its workforce by approximately 20%, impacting around 50 employees. The company is pivoting its strategy to concentrate on traceable, ethically sourced goods for international trade, especially in exports.
Strategic Realignment
The restructuring, confirmed by the company on Thursday, aims to streamline operations. This initiative involves a shift towards goods exports, specifically minerals and agricultural products like lithium and cobalt.
“The Sabi enters the next chapter with a concentrated commitment to trading and traceability of global customers,”
— Statement, Sabi
In 2022, the global trade in conflict minerals was estimated at $16.6 billion according to the Statista.
Company History and Evolution
Launched in Lagos in 2020, Sabi initially served as a software platform. It supported informal retailers digitizing inventory and sales during the COVID-19 pandemic. It later expanded into the fast-moving consumer goods (FMCG) sector, including embedded finances, growing rapidly across Nigeria and Kenya.
By the middle of 2023, Sabi served over 300,000 merchants and managed $1 billion in GMV annually. This growth enabled a $38 million Series B round, achieving a $300 million valuation.
Sabi faced challenges common to many African B2B e-commerce startups. These included thin margins, capital-intensive operations, and difficult unit economics. Despite maintaining a lean operational model and cost-effectiveness, market dynamics have changed.
New Business Line
In March, Sabi introduced Trace, a new business line focused on mineral and agricultural exports. The focus is on products such as lithium, cobalt, and tin. Demand for transparency, ESG compliance, and traceability is rising globally.
The company now exports over 20,000 tons of goods to customers in the US, Europe, and Asia. Sabi has also expanded its operations into the US and has assigned senior employees to assist in the expansion.
The transition showcases the potential for informal trading platforms in Africa to establish a foothold in global trade. While this strategic shift offers the promise of larger margins, it also poses internal adjustments, reflected in Sabi‘s restructuring.
