Scaling A Rocket Internet Funded Online Car Marketplace in Nigeria, with Karl-Johan Sturesson, Co-founder of Carmudi
Karl-Johan, please introduce yourself…
My name is Karl-Johan Sturesson, I am the co-founder and Managing Director of Carmudi West Africa. I am a Swede living in Lagos, Nigeria.
Before joining the Rocket Internet backed up Carmudi I used to work for the largest Nordic bank and having the global responsibility for international hedge funds, before that I had a position at a New York-based hedge fund.
I also launched the startup urbangallery.se – an online gallery and store for emerging artists. I grew up in Sweden, with studies in Linköping, Stockholm, Berlin and New York.
How did the deal come about with Rocket Internet?
Rocket Internet is a fast paced organization with very quick movements in all directions, and this fits me perfectly.
Quick decisions and large focus on execution and of course you will get access to a lot of smart people in the organization that helps you in your business locally.
The banking sector, which I worked in before, can be great but it also very formal and much driven by new regulations.
I was looking for more entrepreneurial related tasks which Rocket Internet definitely could provide.
What’s the story behind Carmudi and can you explain how it works?
Carmudi is a vehicle marketplace that enables customers to easily find or sell their car, motorcycle or commercial vehicle online. At the same time, vehicle dealers and agents get a trusted online presence through a personalized webpage.
Carmudi offers diverse vehicle listings, an intuitive website design and high security standards to avoid fraud.
The business platform operates under a high level of transparency through professional photos, updated listings, detailed descriptions, reports and rankings for 100% of its vehicles.
The Carmudi platform helps sellers manage their inventory in a fast, easy and stress-free way.
Through our platform we have been able to simplify the process of buying cars online and we have brought more trust to the business, which was absent in the market as we give dealers the needed visibility that they need to sell their vehicles.
However, it is important to us to offer or customers a platform with no tolerance for fraud, as we screen every vehicle sent to us before uploading them on the site.
We will build on that and continue to deliver the new best practice in quality listings, zero fraud, pro-active customer service and a premium offering.
We are also active in Latin America, South East Asia and Middle East, with over 10 countries represented and growing.
How’s traction working out so far?
Since the official launch in October 2013, we have reached over 10 000 unique listings only in Lagos. And we currently see a huge demand for the premium service we provide.
The response have been so overwhelming, both from dealers and buyers in the neighbor countries Ghana and Cameroun so we now launched there in January respective February.
The fact that the word of mouth spread the success of Carmudi to these countries really gives us an acknowledgment that we are doing the right things and that it really works – which is fantastic to see.
What challenges did you face when launching, and how did you overcome them?
Of course the cultural difference was quite huge for me as a Swede, coming from Stockholm to Lagos.
The differences were not only related to the huge weather differences, but the way how you do business and also lead a team.
My vision to overcome these cultural challenges was to focus on local knowledge and personnel, rather than getting more expats involved.
I mean, I had quite limited knowledge in the car business and especially the Nigerian car business. So rather then getting more expats down to Lagos I recruited the best guys for the job, Nigerians.
Adding to the above, the key strategy is to find the right team members. It´s sounds like a cliché but the team is everything.
It´s crucial that everyone works toward the same goal and share the same vision and also to let everyone grew and be a part of the decision making process – again my employees are the experts, not me.
What are the top 3 things you have learned since arriving in Lagos that you can share with other entrepreneurs?
1) Be humble to everything and everyone. Extremely important when you arrive in a new country, especially when the cultural differences is so significant from what I was used to in Sweden.
2) Minimize micromanagement – instead establish a winning and creative cultural and give mandate and responsibilities to your employees. You will see great results and yourself can start focus on the right stuff.
3) The team is everything – if you have a great team in place you can manage everything. Doesn´t matter if it´s in the online car classified business or other types of businesses.
What’s it like living and working on Lagos?
Lagos is a chaotic, intense and a wonderful city! Many describes Lagos as the “Big Apple” of Africa – and it´s very true!
The people are very nice and outgoing, but the super large downside is the traffic which sometimes can drive you crazy.
What strategies are you using to market Carmudi?
We have actually used very limited marketing, other than online marketing and mainly social media, which is a very important here in West Africa.
Otherwise, word of mouth is the most successful and powerful marketing you can get, and can´t buy for money.
Our premium product has spoken for itself and the dealer community in Lagos is huge and the car market is divided in various clusters and high traction areas.
My goal has always been that all the Carmudi team members can stand up for our business model and vision and be proud for working for Carmudi – this is the best vehicle market place you can be on!
People and companies in Africa are generally quite risk-averse and reticent on being the first ones to try a new concept.
People and companies here in Africa are getting more and more enlightened in the Internet and the benefits that comes along which also makes our job easier.
But of course, sometimes you need to start from the beginning and educate some people of our services. Some people are still in an “offline-mood”.
Can you tell us a little more about your premium features and revenue model?
We focus on delivering a first class experience when it comes to showcasing cars online, meaning having top quality pictures and descriptions, actively working for a fresh and updated inventory (usually a problem here in Africa) and being in the frontline for new innovative solutions and ideas.
We have for example a Mechanic Certified Cars section, where we have partnerships with certified workshops around Lagos.
For a small cost the seller can get his/her car diagnosed and through this the buyer can see a quality stamp on the car and also have access to the findings from the car diagnose.
We are using a subscription model where the dealer signs up for a certain duration (1-12 months) and for a certain quantity of cars he/she want to showcase online.
When you sell your car you just call us and we will send a Carmudi-agent to list your new cars you have for sale – very simple.
What are the challenges of starting a startup in Nigeria?
To get a successful startup here in Nigeria you need (only) one important component: local resources.
With local resources I include local presence, you need to actually be here, having a local knowledge of the Nigerian market and culture and great local personnel on board. But of course to get this is also a great challenge.
How do you see the startup and investment ecosystem developing in Nigeria?
Only one answer to that, speed and growth. The Nigerians are getting more and more enlightened into the online world and also starting to ask for more technical products.
Buying or selling your car online or ordering food online or via an app is already business as usual in Nigeria.
The demand from Nigerians increases every day and with that also new business opportunity for startups and investors.
What’s next for you and Carmudi?
We will continue with the expansion locally in Nigeria and also expand our business to the rest of West Africa.
In a couple of weeks time we will launch a mobile version of our platform, a step in our innovative strategy – be where our customers are.
Written by SaaSicorn
Ranking SaaS Websites like it's our job (because hey, it is our job).
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