Egypt’s Mtor nabs $2.8M pre-seed for its on-line auto elements market

Egyptian on-line auto elements market Mtor has raised $2.8 million in pre-seed funding led by MENA-focused enterprise capital agency Algebra Ventures. Different traders that participated within the spherical embody Dutch Founders Fund (DFF), Aditum Ventures, LoftyInc Capital and different native and world angel traders, the startup stated in an announcement.

Mtor’s founder and CEO, Mohamed Maged, established the startup in April 2022. His inspiration for the enterprise emerged from years spent in Germany, the place he gained priceless expertise within the automotive sector. Upon returning to Egypt in 2020, Maged joined the B2B e-commerce market MaxAB, holding two distinct head of growth roles earlier than departing to launch Mtor.

In an interview with TechCrunch, Maged described how he acknowledged a major problem in addressing inefficiencies and fragmentation throughout the auto elements provide chain and the automotive aftermarket, particularly specializing in native workshops and automotive mechanic areas. “I got the idea for Mtor before coming to Egypt,” he stated. “I worked in automotive a bit and saw the inefficiency of global suppliers knowing nothing about local workshops or local service providers. Egypt itself doesn’t manufacture that many spare parts, so there is a big information and technical gap not only in terms of distribution but in terms of new products.”

Initially, Mtor, whose management staff contains Maged alongside CTO Khaled Kandil, COO Mohamed Altaf and VP of Technique Moaz El Megharbel, centered on supplying spare elements to native workshops and managing logistics. Over time, the startup expanded operations, forming partnerships with importers to facilitate distribution in an Egyptian market dwelling to hundreds of native service suppliers and tens of millions of automobiles needing upkeep and aftersales elements.

L-R: Mohamed Maged (CEO), Khaled Kandil (CTO), Mohamed Altaf (COO) and Moaz El Megharbel (VP Technique)

Egypt’s automotive after-sales market, among the many largest in Africa and the MENA area, exceeds $5 billion in worth. With an ageing fleet of 8 million automobiles, automotive homeowners spend a median of $600+ yearly throughout 35,000 workshops and repair suppliers, emphasizing the untapped potential inside Egypt’s automotive after-sales market.

At its core, Mtor addresses the ache factors of those native workshops, resolving points comparable to inaccurate fitment knowledge, logistics and supply challenges, elements availability and worth transparency. The startup additionally goals to bridge the hole for automotive homeowners going through a dilemma between official dealerships, the place costs are two to 3 instances greater, and native workshops providing extra reasonably priced choices. Regardless of the potential compromise on high quality at native workshops, particularly throughout world financial challenges, Mtor acts as an middleman, leveraging a tech platform to attach these workshops straight with importers.

Historically, importers ship bulk orders to massive wholesalers, who, in flip, distribute to native mechanics by a number of layers of suppliers. Mtor simplifies this course of, providing extra environment friendly pricing than the standard two-layer provide chain.

“A local mechanic would get the parts from the current supply chain for 10,000 Egyptian pounds but can get it from Mtor for 8,000-8,500 Egyptian pounds because we operate an efficient kind of supply chain from importers to Mtor’s two warehouses in Cairo and Giza and then to these mechanic workshops,” stated Maged. “We’re something in between that will uplift those workshops using a tech platform that connects them directly with the importers, and at the same time, giving them better quality and trustable parts that would then give more or less the needed balance between both worlds including providing logistics and delivery of the products on demand.”

The 2-year-old on-line auto elements market operates on a margin mannequin primarily tied to the elements themselves. The enterprise runs on standardized pricing and derives its take charges or margins from this pricing, which incorporates free supply.

Over the previous 12 months and a half, Mtor has served over 2,500 workshops, fulfilling greater than 70,000 orders. On the provision facet, it has shaped partnerships with over 60 importers.

Past being a tech-enabled distribution arm, Mtor establishes a strong suggestions loop involving knowledge, elements data and pricing factors. Its Mechanic app, focused at these native workshops, facilitates ordering and supplies insights into appropriate aftersales elements. The app additionally manages the redirection of elements, whether or not to Mtor’s or the importers’ stock, enhancing effectivity and collaboration throughout the automotive aftermarket.

Mtor’s give attention to B2B prospects is a departure from platforms that perform as marketplaces connecting automotive homeowners with service suppliers. A notable instance is YC-backed Odiggo, an Egyptian startup that originally operated on this class earlier than pivoting to Sully.ai, an AI staff specializing in automating healthcare duties. Equally, the Nigerian auto offers market Mecho Autotech initially operated as a business-to-consumer market before recently branching into the wholesale distribution of aftersales elements.

Whereas Odiggo’s new enterprise focus and Mecho’s completely different market positioning make them non-direct rivals, Mtor, in keeping with Maged, doesn’t see different B2C gamers as rivals, recognizing that serving auto sellers includes extra frequent orders and better return charges in comparison with direct prospects within the spare elements enterprise.

“They merely complement our model because the service providers are the mechanics. The main aim of Mtor is to empower independent workshops to offer car owners excellent quality service at affordable prices. The right way to do this is to empower those mechanics, which will trickle down to a better experience for the car owner not only in lead time but also in the quality of the parts and even the price he pays,” added the CEO.

Along with lately making hires in management and operational roles, Maged says the startup has focused on growing merchandise that appeal to extra mechanics month-to-month. Its future technique will contain doubling down on this strategy off the again of the brand new funding it has acquired. He remarked that the startup plans to strengthen partnerships with important importers and elements suppliers.

“We are delighted to partner with Mtor’s founders and team, who have built an innovative business that solves a significant pain for mechanics, auto parts suppliers and vehicle owners,” stated Karim Hussein, managing companion at Algebra Ventures on the funding. “Mtor’s unique visual and voice interface coupled with a sophisticated fitment and parts matching engine eliminates the hours spent daily by mechanics hunting for the right part at the right price. We look forward to supporting Mtor on expansion in Egypt and beyond.”