Cairo-based furniture online marketplace Homzmart has raised $23 million in its latest funding round, as the start-up plans to expand its services, the company’s top executive said.
“Another major double down on Homzmart’s expansion vision and the solid milestones that the company keeps achieving,” Mahmoud Ibrahim, co-founder and chief executive of Homzmart, said in a LinkedIn post on Monday.
The latest funding round brings the total amount raised by the Egyptian company to nearly $40m. That includes $1.3m in February 2020 when the company was founded, and $15m in November for its expansion into Saudi Arabia earlier this year.
Saudi Technology Ventures (STV), the largest technology venture capital fund in the Middle East with more than $500m in capital, invested in Homzmart for the first time.
Existing investors including Riyadh-based asset manager Impact46, Dubai-based Nuwa Capital, San Francisco-based Rise Capital and Outliers Venture Capital, an early-stage fund with offices in the US and the Middle East, also participated in the company's latest funding round.
"Homzmart is a building a category-defining company in the $80 billion furniture market with solid unit economics and an experienced team. We are thrilled to double down with [co-founders] Mahmoud and Ibrahim as they expand Homzmart’s footprint to the rest of the region starting with Saudi Arabia," said Mohammed Almeshekah, managing partner of Outliers Venture Capital.
The e-commerce platform is a one-stop shop that connects consumers with retailers and manufacturers selling home furniture, lighting and decor.
Homzmart sales grew more than 30 times in its first year of operation, fuelled by the Covid-19 pandemic, as consumers swapped physical outlets for online shopping sites.
Revenue in Egypt’s e-commerce market is projected to reach $7.74 billion this year and increase at a compound annual growth rate of about 19 per cent between 2022 and 2025, German market and consumer data platform Statista reported.
Homzmart services 25 million houses in Egypt and Saudi Arabia and has more than 150,000 products on its platform.
Saudi Arabia now makes up between 25 per cent and 30 per cent of the total volume of Homzmart business, Mr Ibrahim told Reuters.
The company will use the new funding to build market share and expand services, including its logistics arm, which now has about 100 lorries, he said.
In March, Homzmart also acquired Berlin-based technology company MockUp Studio, which digitises the interior design process.
Venture funding and deals hit a record high in Egypt last year, with $491m invested across 147 transactions, start-up data platform Magnitt reported.
In the first half of this year, Egyptian start-ups raised about $314m, data compiled by Dubai-based venture capital firm Wamda indicated.