Rocket Internet and iMENA Holding have announced that they will partner together to launch mobile app Easy Taxi in the Middle East and North Africa. iMENA will invest $7 million into the app’s regional rollout, which started today in Saudi Arabia.
According to Rocket Internet, the $7 million represents the largest funding so far for a mobile app business in the region. It also marks the latest in a series of investments as Rocket Internet seeks to secure Easy Taxi’s foothold in emerging markets. In July, Easy Taxi received $10 million from Africa Internet Holding (AIH), a joint venture between Rocket Internet and AIH’s 35% owner Millicom, a telecoms operator. The two investors had previously invested $15 million in Easy Taxi in June through another JV, Latin American Internet Holding, in order to expand Easy Taxi in Latin America.
Launched by Rocket Internet in 2011, Easy Taxi’s iOS, Android and BlackBerry apps are now available in 15 markets throughout Latin America, Africa and Asia. The app has been downloaded 2 million times and has over 60,000 drivers in its network.
Headquartered in Berlin, Rocket Internet’s strategy is to take successful e-commerce startup models and replicate them in markets that competitors have not yet entered or have a relatively small footprint. In July, Rocket Internet announced that it had raised an additional $500 million from previous investors Kinnevik and Access. That round of funding took Rocket Internet to over $1 billion in backing so far for this year.
Rocket Internet is using the funds to rapidly build infrastructure in emerging markets that can be repeatedly leveraged when it launches new businesses in other verticals. This makes it relatively easy for Rocket Internet to shut down startups that are faltering in favor of new ventures with more potential. In the Middle East, for example, it closed e-commerce startup Mizado last year to focus on Jumia. Rocket Internet’s other ventures in the region include fashion portal Namshi.
Easy Taxi’s competition in MENA is still relatively light and includes businesses such as Uber and Careem, which both launched in Dubai last month but have yet to roll out to other cities. Rocket Internet hopes that focusing on countries where there is still relatively little competition will result in higher margins than it would make in developed markets such as Europe. This echoes the strategy of other e-commerce startups like Fab and is a contrast to companies like Amazon, which operate on very thin margins on a massive scale in order to yield large returns.