A month after it expressed interest in taking over food delivery ecosystem, CanGo Africa has closed shop in Kigali and Kinshasa citing lack of funding.
Formerly invested in taxi-hailing branded SafeMotos, the firm mid-last December announced it would fill the void in food delivery left by Jumia Food’s shutdown.
At that time, through its social media walls, CanGo announced the operationalization of its on-demand delivery app in Android and IoS versions, shifting from Whatsapp orders.
Delivery fee was Rwf500 in Kigali.
"We are still testing our new App to replace Jumia Food and expect it to be out soon. We were hoping to have it out by January 7 to meet Jumia Foods closure, but we are still working on polish. If you would like to be a tester of the new app and one of the first to use..."— CanGo Rwanda (@cango_rw) January 7, 2020
On December 19th, 2019, however, the company doubled the fee to Rwf1,000 citing “several cost-related reasons.”
On its twitter, CanGo wrote that the increase was “something we must do in order to continue to provide you with the quality you’ve come to expect.”
Despite the move that did not raise many eyebrows, the company this January seemed to aggressively unfold amid a new delivery competition with VubaVuba, Jumia’s spin-off.
VubaVuba was launched by former employees of Jumia.
Before altering the business line, the local firm had been into transport operation in Rwanda since 2014, operating a commercial motorcycle business called SafeMotos.
As it rebranded to CanGo Africa late September last year, the then taxi-moto hailing company stretched operations to Kinshasa, DRC as it completed more than 500,000 trips in Kigali.
The expansion was vastly dependent on investors who poured in hundreds of thousands of dollars last year and more was expected in 2020.
It tested e-Bikes and eyed “Amazon-like” delivery and e-Payment services, however, the ground did not meet the horizon as the investors’ promise did not materialise.
The firm had purportedly considered changing their business strategy to meet the ends - leaving the rags behind and “bootstrap with a brand new pivot”, but the results were not favorable.
“We’ve decided to make the challenging decision to stop while there is still enough money in the bank to pay our employees what we owe them,” said co-founders Barrett Nash and Peter Kariuki in an email sent to investors as reported by Disrupt Africa.com.
CanGo did not reply to our request for comment.
It closes shop barely two weeks after Jumia Food exited the Rwandan delivery space. Nash mid-December told The New Times that Jumia’s closure was an opportunity for his business.
The firm had been testing the new service on its Kinshasa market, and had earned positive feedback from its first users in Kigali.
Former CanGo riders have reportedly refused to wave the white flag, picking up their company’s delivery services under a new name ‘Birashoboka’.