Jumia's Retreat and Redtech's Expansion Show Africa's eCommerce at a Crossroads
While Jumia exits Algeria and narrows focus to chase profitability, Redtech is betting big on pan-African expansion. The diverging strategies reveal how Africa's tech giants are rethinking scale in 2026.
Syntheda's AI technology correspondent covering Africa's digital transformation across 54 countries. Specializes in fintech innovation, startup ecosystems, and digital infrastructure policy from Lagos to Nairobi to Cape Town. Writes in a conversational explainer style that makes complex technology accessible.
Africa's eCommerce landscape is pulling in opposite directions. On one side, Jumia — the continent's most recognizable online retailer — just shut down operations in Algeria and posted a 34% revenue jump to $61.4 million in Q4 2025. On the other, Redtech, backed by Tony Elumelu's Heirs Holdings, is charging into 29 African markets with acquisitions on the table and ₦30 trillion processed through its RedPay platform in 2025.
The contrast couldn't be sharper. Jumia's playbook now centers on fewer countries, tighter margins, and direct sourcing to fend off Chinese rivals like Temu and Shein. Redtech's strategy? Go everywhere, fast, and use mergers to accelerate. Both approaches reflect hard lessons learned from Africa's first tech boom — but only one can define the next decade of digital commerce on the continent.
Jumia Chooses Survival Over Scale
According to Techpoint Africa, Jumia's exit from Algeria is part of a "wider push to improve profitability, narrowing its geographic footprint while investing in direct sourcing." The company has been bleeding cash for years, and investors are tired of waiting. By consolidating operations in core markets like Nigeria, Kenya, and Egypt, Jumia hopes to finally turn a profit.
The Q4 numbers offer some vindication. Revenue climbed 34% year-over-year, driven by stronger marketplace sales and rising demand in Nigeria. Losses narrowed, and cash burn slowed. But the Algeria pullout signals a uncomfortable truth: being everywhere in Africa doesn't guarantee success. Logistics remain brutal, payment infrastructure is patchy, and consumer purchasing power varies wildly across borders.
Jumia's pivot to direct sourcing — buying inventory upfront rather than acting purely as a marketplace — is a defensive move against Chinese platforms flooding African markets with ultra-cheap goods. It's a bet that controlling supply chains will create stickier customer relationships and better unit economics. Whether it works depends on execution, not ambition.
Redtech's Pan-African Gamble
While Jumia retreats, Redtech is sprinting forward. The company announced plans to expand into 29 African countries, with mergers and acquisitions explicitly on the table to speed up market entry. Techpoint Africa reports that RedPay, Redtech's payment infrastructure play, processed ₦30 trillion in 2025 — a staggering figure that underscores the company's ambition to be the rails for Africa's digital economy.
Redtech's strategy hinges on payments, not just eCommerce. By embedding financial services into its platform, the company can monetize transactions even when product margins are razor-thin. It's a model borrowed from Asia's super-apps, where payments, logistics, and commerce converge into a single ecosystem.
The Heirs Holdings backing gives Redtech serious firepower. Tony Elumelu's conglomerate has deep pockets and a track record of long-term bets across energy, finance, and hospitality. That patient capital matters in Africa, where building infrastructure takes years and profitability often comes later than Silicon Valley expects.
What This Means for Africa's Tech Future
The Jumia-Redtech divergence isn't just corporate drama — it's a referendum on how to build sustainable tech businesses in Africa. Jumia's retreat suggests that the "Africa is one market" narrative was always oversimplified. Regulatory fragmentation, currency volatility, and infrastructure gaps make cross-border operations brutally expensive.
Redtech's expansion, meanwhile, bets that those challenges can be overcome with the right capital structure and a payments-first approach. If successful, it could prove that scale still matters — but only if you build the financial plumbing first, then layer commerce on top.
Other signals point to a maturing ecosystem. Sun King, known for solar products, just entered Kenya's mobile phone market, according to Techpoint Africa. Honor launched its X9d smartphone in Lagos with premium features targeting Nigeria's growing middle class. These moves show that African consumers want more than just cheap goods — they want quality, brand trust, and localized products.
Even consumer behavior is shifting. Google Search data cited by Techpoint Africa shows Nigerians are rethinking Valentine's Day in 2026, with searches tilting toward friendship and self-care over traditional dinner dates. That cultural fluidity creates openings for platforms that understand local nuance — something foreign players often miss.
The next 18 months will clarify which model wins. Jumia's profitability push could vindicate the "less is more" school of thought, proving that focus beats footprint. Or Redtech's blitz could demonstrate that Africa's digital economy rewards those who move fastest and build the deepest infrastructure. Either way, the era of growth-at-all-costs is over. What comes next will be leaner, smarter, and far more African.