The founders of Brimore, a Cairo-based social e-commerce platform connecting suppliers to community sellers, say they entered the market to solve one problem: why emerging brands were unable to succeed in Egypt despite millions of price-sensitive customers ready for a good deal.
One reason is marketing and second distribution, both require a lot of money.
“More than 95 per cent of our brands are unknown, so our promise to suppliers is to create and generate the demand,” says Brimore chief executive Mohamed Abdulaziz.
“We connect emerging brand owners with a network of micro sellers on social media, so they can sell and refer the products in their surrounding circles, ensuring smooth market access for the supplier and dynamic income opportunities for the sellers.”
Brimore – which merges the words "bring" and "more" – capitalises on the region’s e-commerce boom. The sector surged 52 per cent to reach $22 billion by the end of 2020, 80 per cent of which came from Egypt, Saudi Arabia and the UAE, according to a study from Wamda and MIT.
Mr Abdulaziz and chief business officer Ahmed Sheikha, who had been classmates and friends at Alexandria University, worked in end-to-end distribution and product management for various companies before founding Brimore in 2017.
The start-up began with five employees and has since grown to around 700. It now has a network of 75,000 active sellers and 300 suppliers, offering more than 8,000 products in categories that include household goods, personal care, fashion, electronics, furniture and food and beverages.
It plays to the natural social fabric of Egypt
Tarek Assaad,
managing partner at Algebra Ventures
Brimore raised $3.5 million in a pre-series A round in May 2020, after raising $800,000 in a seed round in April 2019 and is soon planning to announce its series A round – its largest by far.
The seed round was co-led by Algebra Ventures and Endure Capital with participation from 500 Startups, Flat6Labs and angel investors.
The pre-series A Round was also led by Algebra Ventures with the participation of DisrupTech, Vision Ventures and existing investors 500 Startups and Flat6Labs.
“We came in very early and we continue to support Brimore throughout their journey,” says Tarek Assaad, managing partner at Algebra Ventures.
By working with small- and medium-sized Egyptian factories and buying a large portion of their capacity, Brimore “changes very significantly the economics of these brands”, he says.
The platform then helps move these products to a network of sellers that is 92 per cent women, with more than 70 per cent of business coming from rural areas outside Cairo and Alexandria.
“The end consumer, who is typically very price-sensitive and not very brand-sensitive has access to a product that’s a good fit for them. And the seller is able to create a small business in a socially acceptable manner, with tremendous upside potential,” Mr Assaad says. “It plays to the natural social fabric of Egypt.”
Algebra Ventures and new investors, including Fawry, Flourish Ventures and the International Finance Corporation (IFC), have joined in the third round.
Egyptian FinTech Fawry acquired a minority stake in Brimore at a value of 15.7m Egyptian pounds ($1m) in September.
The acquisition allows Fawry to introduce its network of 230,000 merchants to Brimore’s distribution platform, while Brimore clients will be able to access Fawry’s digital payments and financial services.
“Fawry’s investment in Brimore fully aligns with our strategic objectives of expanding Fawry’s digital ecosystem and establishing a foothold in Egypt’s booming e-commerce scene,” Fawry chief executive Ashraf Sabry said at the time.
The IFC disclosed in August that it was considering an equity investment of $5m in Brimore, primarily to expand the company’s operations.
The latest funding will be “mainly directed towards building our infrastructure, our operational excellence and expansion in the country”, says Mr Sheikha.
Brimore already calls itself “the biggest social e-commerce app in Africa” by number of users and revenue, which the founders declined to share publicly.
“When we started this business, the momentum of social commerce worldwide wasn’t like now,” says Mr Abdulaziz. “For Africa, we are pioneers in this.”
He points to success stories elsewhere, such as Meesho in India, which was founded in 2015. It enables small businesses and individuals to start their online stores through social channels such as WhatsApp, Facebook and Instagram.
Meesho has raised a total of $1.1 billion in funding, including an equity investment from Facebook in 2019. It boasts a network of 17 million resellers, 15 million of whom are women, and over 60,000 suppliers.
In Brimore’s model, the app is a tool for sellers to generate promotional material and share through social media or face-to-face. When they receive orders from consumers, they place the consolidated order, which is then sent to a central warehouse to get fulfilled and delivered to customers’ doorsteps.
“We did not explicitly target only women. But when we started operations, we realised [there was] more traction coming from the women side,” says Mr Sheikha.
Brimore buys inventory at cost and ensures a 25 per cent to 40 per cent profit margin for sellers, who are able to earn 3,000 to 4,000 pounds monthly, on average.
The company has also piloted a microfinancing project, offering credit facilities to sellers while making money from the interest. Mr Sheikha says this is coupled with providing them with financial literacy skills.
“It’s not just about giving them money. It’s about supporting them on how to benefit from this money,” he says.
Brimore also generates capital through its end-to-end fulfillment business Milezmore, which it started about a year ago.
With 18 delivery hubs and 80 delivery vans, the company handles all of the warehouse and fulfillment operations and more than 50 per cent of last-mile delivery.
“We believe that Milezmore will be a completely separate entity that we can raise dedicated funds for,” Mr Sheikha says.
The next step in Brimore’s journey is to start regional expansion in Africa. The company is considering expanding to Kenya and Morocco in 2022, Mr Sheikha says.
“We’re targeting mainly countries in Africa and some parts of the Middle East.”
Q&A: Mohamed Abdulaziz, chief executive and co-founder of Brimore
What successful start-up do you wish you had started?
I love M-Pesa in Kenya and how they’ve solved a real problem with a great product-market fit and relying on social networking in creating M-Pesa agents all over Kenya. Now, it’s more than 98 per cent adoption and one of the main incentives for any commercial business in Kenya.
What new skills have you learnt in the process of launching your start-up?
Two skills: first is resilience. The journey wasn’t easy and we walked a very long road to be here. We’ve faced a lot of challenges in operations, fundraising, hiring, suppliers and so on. In hard times and with every tough decision, being resilient was key to overcome the challenge. The second one is strategic thinking. Building an entire parallel market needs a smart strategy to connect the dots within the full value chain.
How has the pandemic affected your business?
Thankfully, we were on the good side of the pandemic. The pandemic proves that having a trade business doesn't require having a brick-and-mortar store; you can run a business from your home, on WhatsApp or Facebook, or even through phone calls. It helps in increasing the adoption of social e-commerce on both sides, consumer and reseller.
What is your next big dream?
With the population pyramid in Egypt and Africa, I see a huge opportunity in HealthTech (health technology) and I believe in the impact that we can provide in this space. Another dream is to see a group of Brimore alumni building impactful ventures that can drive the growth of the economy and make a real change.
Where do you see the company in the next five years?
With the entire parallel market we are building and focusing on creating real value, I see Brimore as the market gate of Africa.
Company profile
Company: Brimore
Date started: 2017
Founders: Mohamed Abdulaziz and Ahmed Sheikha
Based: Cairo, Egypt
Sector: Social e-commerce
Size: 700 employees
Investors: Algebra Ventures, DisrupTech, Endeavor Catalyst, Endure Capital, Fawry, Flat6Labs, Flourish Ventures, International Finance Corporation, 500 Startups, Vision Ventures
Day 5, Abu Dhabi Test: At a glance
Moment of the day When Dilruwan Perera dismissed Yasir Shah to end Pakistan’s limp resistance, the Sri Lankans charged around the field with the fevered delirium of a side not used to winning. Trouble was, they had not. The delivery was deemed a no ball. Sri Lanka had a nervy wait, but it was merely a stay of execution for the beleaguered hosts.
Stat of the day – 5 Pakistan have lost all 10 wickets on the fifth day of a Test five times since the start of 2016. It is an alarming departure for a side who had apparently erased regular collapses from their resume. “The only thing I can say, it’s not a mitigating excuse at all, but that’s a young batting line up, obviously trying to find their way,” said Mickey Arthur, Pakistan’s coach.
The verdict Test matches in the UAE are known for speeding up on the last two days, but this was extreme. The first two innings of this Test took 11 sessions to complete. The remaining two were done in less than four. The nature of Pakistan’s capitulation at the end showed just how difficult the transition is going to be in the post Misbah-ul-Haq era.
Muslim Council of Elders condemns terrorism on religious sites
The Muslim Council of Elders has strongly condemned the criminal attacks on religious sites in Britain.
It firmly rejected “acts of terrorism, which constitute a flagrant violation of the sanctity of houses of worship”.
“Attacking places of worship is a form of terrorism and extremism that threatens peace and stability within societies,” it said.
The council also warned against the rise of hate speech, racism, extremism and Islamophobia. It urged the international community to join efforts to promote tolerance and peaceful coexistence.
The specs: 2018 Nissan Patrol Nismo
Price: base / as tested: Dh382,000
Engine: 5.6-litre V8
Gearbox: Seven-speed automatic
Power: 428hp @ 5,800rpm
Torque: 560Nm @ 3,600rpm
Fuel economy, combined: 12.7L / 100km
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
World record transfers
1. Kylian Mbappe - to Real Madrid in 2017/18 - €180 million (Dh770.4m - if a deal goes through)
2. Paul Pogba - to Manchester United in 2016/17 - €105m
3. Gareth Bale - to Real Madrid in 2013/14 - €101m
4. Cristiano Ronaldo - to Real Madrid in 2009/10 - €94m
5. Gonzalo Higuain - to Juventus in 2016/17 - €90m
6. Neymar - to Barcelona in 2013/14 - €88.2m
7. Romelu Lukaku - to Manchester United in 2017/18 - €84.7m
8. Luis Suarez - to Barcelona in 2014/15 - €81.72m
9. Angel di Maria - to Manchester United in 2014/15 - €75m
10. James Rodriguez - to Real Madrid in 2014/15 - €75m
