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Silvertree takes full control of DealDey as Ringier exits to shift their focus

10 March 2017

An interview with DealDey CEO Kehinde Oriola, adapted from TechMoran.

1) How is the progress at DealDey?

DealDey and our expansions Promohub and Lyf as well as their teams are all working incredibly hard on our mission to give all Nigerians good value for their money in online and offline-to-online retail. Specifically in tough times for Nigerians, we see our value proposition confirmed. Our group’s focus on services – like hotels, spas, events, et al – has yielded good returns and the group has also made huge progress towards ultimate profitability and that is what we are most excited about. Considering the situation with the economy, we are aligning the business to ensure that we are properly positioned.

2) What are the most sold items on DealDey and why?

The most rapidly growing category has been services. Events, spas and hotels: we have a big focus on this as the economics are great and it fills a big need in the market and for our customers. We also continued strength in household products, tech gadgets, and fashion.

3) Has the partnership with Ringier Africa and Silvertree Internet Holdings been successful?

The partnership with Ringier as financial backer of our e-commerce group as well their expertise in large groups in marketing, publishing and marketplaces in Africa and Silvertree’s financial and hands-on support on the e-commerce leadership and operations side have been tremendously helpful. We are much further because of both of them as partners.

4) What is the plan going forward?

With the group and financing now on the right track, Ringier has come to an agreement with the operational partner Silvertree to sell its stake in the partnership to Silvertree. This has allowed for an exit for Ringier after a good set-up as well as for a continued operation of the group by Silvertree in partnership with the DealDey/PromoHub/Lyf management.

We are tremendously thankful to Ringier for the successful partnership and are excited for their exit to Silvertree. I am sure they can take their learnings and teachings on e-commerce in the deals group to more companies, for example through their P-Promos promotions scheme in their publishing group Pulse Africa. We will also continue to collaborate with Ringier entities on this after this exit.

5) With the closure of Groupon SA and the ‘shut down’ of Rupu in Kenya. Is it right to say Africa is not ready for the daily deals business?

No. But one needs to adapt to the market.

The founders of Groupon in South Africa have just founded Hyperli.com – a serviced and product focused discount deals business for South Africa. There the market is very ready for this model and Hyperli is also not the only business in the market – DaddysDeals is another that’s also doing well.

In Ghana and Kenya the deals group has seen that the e-commerce market in general is still relatively early in its development -so online promotions via Ringier’s P Promos is the right model.

In Nigeria we have made great progress with a broad services and discount product model with DealDey and will continue to expand on it now.

6) Did the transition of Rupu in Kenya to PPromos spark Silvertree into buying DealDey out of the partnership?

No – the creation of P Promos and integration of Rupu in Kenya and Tisu in Ghana was a joint decision by the management and shareholders based on best capturing market opportunities.

Silvertree has strong expertise in e-commerce in Africa while Ringier is now doing more and more in classifieds, publishing and marketing. So I see this as a logical step of two partners gaining from a transaction.

7) Are sister brands Promohub and Lyf part of the deal?

Yes – they together with DealDey form the deals group now which is being bought by Silvertree.

8) What are the financial details of the deal?

I cannot comment on that.

9) What other businesses will DealDey be integrated with?

Silvertree runs many leading vertical e-commerce businesses in South Africa – from Cybercellar for wines to Faithful to Nature for organic products to CarZar for cars. There has been a lot of exchange of ideas and this will continue. In addition, Silvertree’s comparison vertical includes brands such as Pricecheck in Nigeria, which is a valuable partner for DealDey.

10) What have been the biggest challenges you have faced while running Nigeria’s top daily deals site?

Adapting the model for profitability while ensuring our customers continue to get great value – which we have now done.