African e-commerce will hit $46B by 2025. Here’s how to make the most of it.

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Hi there,

Welcome to the very first edition of In A Giffy—the newsletter by TechCabal Insights that helps you make sense of Africa’s digital economy in a single chart.

In this newsletter, we will provide data-driven, practical, and contextual solutions for for founders, investors, governments and other stakeholders of Africa’s digital economy on and off the continent. As an innovator, founder, or business leader, you can leverage these solutions to make important decisions.

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Now, let’s dive in.

by Mobolaji Adebayo

Africa’s digital economy is expected to hit $180 billion by 2025, accounting for 5.2% of the continent's GDP. E-commerce revenue is projected to reach $46.1 billion in the same year, driven by the rise in the number of online shoppers from 387 million in 2022 to 520 million in 2025.

Currently, about 41% of internet users in Egypt make online purchases, while South Africa's figure stands at 47%. These figures fall short of the global average of 58% making it hard for ecommerce companies in the continent to break even.

So, how can ecommerce founders and executives achieve high user growth and increase revenue?

Reduce burn rate by fixing unit economics.
Improve distribution margins by buying directly from producers instead of middlemen.
Offer buy-now-pay-later credit services to users for flexible payments and to boost sales volume.

African e-commerce companies have their work cut out for them in the coming years. Increasing user base and revenue remains key to their survival.

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