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Founded by Mark Essien in 2012, Hotels.ng today is said to have over 7 000 hotel listings and claims to be the largest online service of its kind in West Africa.
While company has been turning profit ever since late 2014, the investment comes at a time when Germany’s Rocket Internet-backed competitor Jovago is hot on its tail, keen to take over the online hotel listing space from East Africa to West Africa and everything in between.
Also keen to become Africa’s most popular accommodation booking website, WakaNow, which has been funded by New York-based VC Tiger Global, is also bulking in Nigeria.
“We’re forging ahead into relatively uncharted territory; ecommerce in Africa is a massive market to conquer, but there are no hard and fast prototypes from which to follow,” Essien says in a recent press release. “We cannot simply replicate Western models here, we have to build our own blueprints from scratch, which takes significant investment, both in terms of time and money.”
In 2013, Hotels.ng raised a total of US$225 000 in seed funding from founder of iRoko Group, Jason Njoku’s Spark accelerator.
In a statement made to TechCabal, Njoku explained why this post-million dollar investment is so significant to the African startup scene:
Closing on this funding round is a big win, not only for Hotels.ng, but for all African internet startups. It is proof, if any more were needed, that the Internet market in Africa is extremely appealing for VCs, more of whom are now looking to create value and build big on the continent.?
The year is shaping into becoming an interesting one for African startups with Kenyan-based BitPesa raising over US$1.1-million at the beginning of the year and South Africa’s WooCommerce being recently acquired by the founder of WordPress.org, Matt Mullenweg’s Automattic for a rumoured US$30-million.
“At the start it was quite hard to raise investment”, he tells TechCabal. “Now that our numbers are strong and the business is growing fast, I am actually constantly getting investment offers. What’s important at this stage, though, is working with the right people.”
The founder further notes that the investment will help the company consolidate its position in Nigeria as well as expand into other markets like neighbouring Ghana.
Update: This article has been updated to include an additional quote from Hotels.ng CEO Mark Esien.