Overview:
SafeBoda had launched in Ibadan, Nigeria, after a ban on okadas or bodas in Lagos.
Ride-hailing company SafeBoda has announced that it is exiting the Nigeria market effective December 2022 so as to concentrate on its largest market in Uganda.
In a statement, the company said the Nigerian market is no longer profitable in the current economic conditions.
“Nigeria okada (a local term for motorcycle taxis) industry in its current state is not economically viable and unfortunately requires significant investment at this challenging time in the global economic landscape,” SafeBoda is a press statement.
SafeBoda had launched in Ibadan, Nigeria, after a ban on okadas or bodas in Lagos.
“The unit value of our services [in Uganda] are significantly higher than in Nigeria and our brand has deep roots. In Uganda, our boda, car [core transport] also work well with our parcel delivery, payments and financial services products. We see growing cross sell from our core transport use case,” Alastair Sussock, the SafeBoda co-founder and chief executive officer, is quoted as saying at the weekend.
“The unit value of our services [in Uganda] are significantly higher than in Nigeria and our brand has deep roots. In Uganda, our boda, car [core transport] also work well with our parcel delivery, payments and financial services products. We see growing cross sell from our core transport use case,”
Alastair Sussock, the SafeBoda co-founder and chief executive officer
“In Nigeria, the core unit economics of the okada business were very challenging, they were positive, but the margins were too thin. 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,” Sussock added.
This is the second time SafeBoda is exiting a market since its founding in 2017. In 2020 SafeBoda exited Kenya after extending its services to Nairobi less than two years prior. The company said it exited Kenya due to the negative effects of COVID-19 on its business.
SafeBoda recently secured additional funding from Yamaha Motor Company and existing investors, including Unbound, Allianz X, and JAM Fund to help it deepen its core transportation offering.