Egyptian tuk-tuk start-up Halan to expand to Ethiopia

Mounir Nakhla, founder and CEO of Halan, is seen during an interview with Reuters in Cairo, Egypt September 17, 2019. Picture taken September 17, 2019. (Reuters)
Updated 19 September 2019

Egyptian tuk-tuk start-up Halan to expand to Ethiopia

  • CEO and founder Mounir Nakhla hopes Halan will become “pan-African”
  • The company is also expanding to more cities in the Egyptian governorates

CAIRO: Halan, an Egyptian technology start-up that uses two- and three-wheeled vehicles to transport passengers and goods, will begin operating in Ethiopia before the end of 2019, its chief executive told Reuters.
The company, which targets underserved communities, is also expanding to more cities in the Egyptian governorates of Sharqeya, Daqahleya, Damietta, Qena and Gharbeya this year, said CEO and founder Mounir Nakhla.
Halan’s app allows customers to request motorbike or tuk-tuk rides, or order food or goods for delivery via motorbikes or cargo tricycles. Founded in November 2017, it already operates in around 20 to 25 cities in Egypt and Sudan.
“Halan completes a few million rides per month, almost half a million of which are in food deliveries,” Nakhla said, adding ride-hailing trips had increased 55% and food deliveries more than quadrupled in the year to date.
Nakhla, who has a background in microfinance, hopes Halan will become “pan-African” and said he saw tremendous opportunity for growth on the continent.
“Adama is a very small place in Ethiopia, about 150 km away from Addis Ababa, and it has a lot of two-wheelers and three-wheelers,” Nakhla said.
“It’s a great place to test our product in Ethiopia. We’ve already done tens of rides there in the form of testing, and we’ve got a team on board.”
The city has less than 1,000 vehicles whose drivers Halan will try to recruit to its platform “before launching countrywide,” Nakhla said.
Halan has delivery partnerships with fast food chains like McDonald’s, KFC and Pizza Hut in Egypt. It is now targeting smaller restaurants in the underserved areas it focuses on.
The app has around 10,000 active drivers per month in total, Nakhla said. He added that Egypt has around 700,000 tuk-tuks on its streets. Uber has 90,000 monthly active drivers in Egypt.
Halan is in the midst of a so-called Series B funding round, Nakhla said, declining to disclose a timeline or targeted amount.
The start-up has raised “slightly less than $20 million” to date, Nakhla said. It employs more than 100 people.
Gojek, an Indonesian ride-hailing and e-payments company, inspired Nakhla to found Halan after he met Gojek founder and CEO Nadiem Makarim in Indonesia in 2017.
When asked if Halan would eventually go public, Nakhla said: “Our current main focus is to grow the company exponentially in a sustainable manner, while adding value to the community.”


India probes Flipkart, Amazon discounts after retailers complain

Updated 15 October 2019

India probes Flipkart, Amazon discounts after retailers complain

  • Products on Amazon, Flipkart listed at steep discounts in sale
  • Trader groups allege firms violating foreign investment rules

NEW DELHI: The Indian government is looking into whether hefty discounts offered on Walmart-owned Flipkart and Amazon.com during their online festive sales violate foreign investment rules, a commerce ministry official told Reuters.
India introduced new rules in February aimed at protecting the 130 million people dependent on small-scale retail by deterring big online discounts. The rules forced e-commerce firms to tweak their business structures and drew criticism from the United States, straining trade ties between New Delhi and Washington.
While Amazon and Flipkart say they’ve complied with the federal rules, local trader groups say the two companies are violating them by burning money to offer discounts — of more than 50 percent in some cases — during the ongoing festive sales.
Reuters reviewed emails and internal training material from Flipkart showing the company is in some cases offering to reduce, or forfeit, its sales commission from sellers that offer discounts.
The commerce ministry official said the government was reviewing complaints and evidence filed by the Confederation of All India Traders (CAIT), a group representing some 70 million brick-and-mortar retailers, alleging Amazon and Flipkart were violating the foreign investment rules.
The official declined to comment on possible action, but executives from Amazon and Flipkart were summoned to meet commerce ministry officials last week to discuss the matter.
Flipkart in a statement said it had a “good meeting” with government officials and it was “deeply committed to doing business the right way in India.”
Amazon said it had an “open & transparent discussion” with officials and has a high bar for compliance.
Seeking to attract shoppers around the key Hindu festival of Diwali, both retailers have placed full-page advertisements in top national daily the Times of India to showcase discount offerings stretching from Samsung and Apple phones to clothing and diapers.
“Customers are going online because of the unbelievable discounts. Because of this sales at offline businesses are down 30 percent to 40 percent this month,” CAIT’s secretary general Praveen Khandelwal said.
Two emails received by Flipkart sellers in September, just days ahead of the inaugural phase of the festive sales, showed it offering to partly fund discounts.
The company would “burn” 3 percent of the discount if a seller lowered a product price by 15 percent, or 9 percent if the seller discounted by 30 percent, said one of the emails.
In training material posted on Flipkart’s restricted website for its sellers, seen by Reuters, the company asks them to prepare for the festive season by saying “nothing is bigger than this” and explaining how they can benefit by discounting products for Flipkart’s premium customers.
“We want to ensure that you fetch as much profit from it as possible ... whatever the discount you are offering, half of that will be reimbursed to you by Flipkart,” a post said.
A Flipkart source said the incentives were compliant with Indian regulations and were aimed at promoting sellers’ earnings by effectively reducing the commission they pay.
All India Online Vendors Association, whose 3,500 members sell products on various online platforms including Flipkart, in a statement said fewer than 100 of its members benefitted from Flipkart’s partial discount funding, giving some sellers an unfair advantage.