The investment world is always full of surprises, and the recent exit of Baillie Gifford from its substantial stake in Jumia has sent shockwaves through the financial community. In a move that signifies a significant shift in confidence, the renowned investment firm has divested its entire 18 million-share holding in the African e-commerce giant. As reported by techpoint.africa, this decision marks a notable transition from being Jumia’s largest institutional investor to holding no ownership interest at all.
“Baillie Gifford has sold its entire 18 million-share stake in Jumia.”
The journey leading up to this pivotal moment began with Baillie Gifford gradually reducing its stake in Jumia over time. From holding 9.2% of shares in January 2024 to owning 7.4% by November of the same year, the final step was taken when they offloaded their remaining shares, bringing their ownership percentage down to zero by May 2025.
“Baillie Gifford likely incurred significant losses as Jumia’s share price dropped.”
The decision to part ways with such a substantial investment is undoubtedly not one taken lightly. With Jumia’s share price plummeting from over $26 during its IPO in 2019 to approximately $2.5 at the time of sale, it’s evident that Baillie Gifford faced considerable financial repercussions due to this move.
Despite efforts by Jumia to navigate these challenging times and steer towards profitability by 2027, their first-quarter report for 2025 revealed a concerning 26% year-on-year revenue decline. While the company managed to reduce its net loss compared to the previous year, there are clear hurdles on their path to sustainable growth and success.
“Jumia’s Q1 results showed a 26% year-on-year revenue decline despite cost-cutting measures.”
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, one key aspect affecting Jumia’s standing within the competitive e-commerce landscape is intensified rivalry from global players like Temu and Shein. These industry giants have entered critical African markets with aggressive pricing strategies and innovative marketing campaigns that pose a direct challenge to local incumbents like Jumia.
Temu made an impactful entry into Nigeria by offering attractive discounts and speedy delivery commitments starting November 2024, while Shein strategically expanded across South Africa, Kenya, and Ghana leveraging influencer-driven promotions.
In response to these dynamic market shifts caused by new entrants disrupting traditional norms, Francis Dufay – CEO of Jumia – emphasized the company’s focus on strengthening relationships with international sellers, particularly those based in China. This strategic move aims at expanding product offerings while maintaining competitive prices amid mounting competition.
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We have significantly strengthened our relationships with international sellers…”
Despite these proactive measures initiated by Jumia management and leadership team under CEO Francis Dufay’s guidance; losing Baillie Gifford as a pillar of support might impact future institutional investments for the e-commerce entity as it navigates through fierce competition towards profitability milestones ahead.
In conclusion,
as reported by [techpoint.africa], Baillie Gifford’s departure marks more than just an investor stepping back; it represents a broader narrative about challenges faced within emerging markets’ digital commerce ecosystems where adaptability reigns supreme.
Attribution:
Original article published on techpoint.africa (Link: https://techpoint.africa/news/jumialargest-investor-exits/)
