Chari, a YC-backed Moroccan startup, has just closed a $5 million seed round at a valuation of $70 million.
Founded by Sophia Alj and Ismael Belkhayat last year, Chari was a part of Y Combinator’s Summer batch, which ended two months ago and in which renowned companies such as Plug and Play, Village Capital/MetLife Foundation, Orange Ventures, Airbnb, SPE Capital, and the management business of an American Ivy League university all participated.
The round, which is currently the largest of its kind in Morocco, was co-led by Rocket Internet, Global Founders Capital, and P1 Ventures.
Chari’s aim is to digitize Morocco’s informal retail establishments and increase their respective credibility.
It all started last year as Boston Consulting Group’s ex-strategy consultant, Ismael Belkhayat, and McKinsey‘s ex-strategy consultant Sophia Alj were alerted on alterations in Africa’s e-commerce scene. Alj was sent on a mandatory work assignment to learn how fast-moving consumer goods (FMCGs) operate in Sub-Saharan Africa.
With Belkhayat along for the ride, the couple learned about the difficulties regional businesses often encounter when it comes to obtaining supplies. They had never noticed anything like this in Morocco before, but it became clear after returning to the North African country that “local mom and pop shops required such assistance,” Belkhayat told Morocco World News.
As a result, the Moroccan couple developed a similar platform in Morocco after seeing startups like TradeDepot, MaxAB, and Sokowatch bring retailers online in other African marketplaces and validating the need for an app to bridge such a gap.
Chari is a mobile app that allows small businesses to order products from collaborating FMCG multinationals and local producers and have them delivered in under 24 hours.
In addition, according to CEO Belkhayat, the recent acquisition of Klarny.ma, a platform for credit and bookkeeping services, has allowed Chari to compete with MaxAB across the country by giving the company access to more shops. Chari also has an advantage in the still-nascent business because of the company’s “excellent relationship” with its suppliers, he indicated in a recent TechCrunch reportTechCrunch report.
The Moroccan business currently transacts roughly $2.5 million every month. It has 15,000 merchants signed up and is growing at a rate of 20% per month, but only half of them use the site on a regular basis. When you include Karny, the total number of merchants who use Chari’s goods exceeds 50,000.
Following this seed round, Chari is projecting to expand across Francophone Africa, with Cameroon, Ivory Coast, Mauritania, and Senegal at the top of the company’s list. In Tunisia and Morocco, Chari will also use the funds to get licenses to offer other financial services such as remittancesremittances, bill payments, mobile top-up, and buy now, pay later.
In an interview with MWN, Belkhayat expressed his utmost joy and aspiration in regards to the growing sector of startups in Morocco.
“Sophia and I are happy to show that a Moroccan startup can shine in the region. We started in Morocco, expanded our operations in Tunisia and now to other French-speaking African Countries,” he said.
When asked about his journey in launching the startup in Morocco, Belkhayat looked back on the past year in a mix of disbelief, great pride, and admiration for the hard work put into the making of what he referred to as his “third child.”
“Don’t get me wrong it’s not always easy to get people to believe in your project, at first I had bankers not giving me the time of day but now we are looking at possibilities to raise money from global investors,” he said.
“We hope that this example will bring motivation to many other Moroccan entrepreneurs. Morocco has a great market and has the potential to create a lot of tech golden nuggets. I am sure that Chari is only the first of them and that we will see many of them in the near future.”
