Ask any seasoned African tech expert and you’ll hear the standard verdict: food delivery drains investor dollars, an understandable stance as Africa’s digitally savvy youth population faces dwindling purchasing power.
Yet Foodpod by Subtext, a three-part report produced with Paystack, asks different questions and shows the sector already defying predictions of failure.
Between 2021 and 2024, Nigerians saw basic food prices double and their purchasing power halve, but more than ever embraced online orders; the segment recorded a spectacular 187 % compound annual growth rate. Chowdeck’s monthly orders rocketed to one billion, while Glovo clocked ₦72 billion ($46.5 million) in vendor sales. Growth now extends beyond aggregators to a buzzing lattice of logistics firms, cloud kitchens and quick-service restaurants.
This exponential growth isn’t limited to aggregators; a bustling ecosystem of logistics providers, cloud kitchens, and quick-service restaurants is also thriving.
Osarumen Osamuyi, author of Foodpod, argues that we shouldn’t be too quick to dismiss the sector’s potential. He argues that the investment of previous players were not an absolute loss; they cultivated new market behaviours that have laid the groundwork for current growth, particularly in Lagos and some Tier 2 cities.
The question of whether a successful business can be built selling convenience where money is scarcer than time may be outdated. Instead, Osamuyi proposes: “Perhaps the question is not whether you can build a large business doing delivery; it is about what you do once you’ve built one.”
Foodpod likens food delivery to “magic beans” in the fabled Jack and the Beanstalk, where a boy trades his family’s only asset for a bag of beans that sprout a ladder to unexpected riches overnight. Likewise, the sector may not look lucrative at first but can reward those who master it. Platforms already stretch into non-food retail, courier services and advertising; Chowdeck’s recent acquisition of Mira pushes it into restaurant inventory management. And this, Foodpod insists, is only the beginning.
If this optimistic perspective about the sector sounds interesting to you; you can read Osamuyi’s first part of the three Foodpod reports and catch up on the rest later here.
