Glovo’s exit from Ghana in May 2024 after less than two years – despite investing $3.7 million – reveals a fundamental truth about African tech: digital solutions cannot leapfrog physical infrastructure challenges, regardless of capital deployed or technological sophistication.
The Spanish delivery giant entered Ghana in 2021 with considerable optimism. Their leadership publicly cited the country’s growing internet penetration (38% and rising), youthful population, and emerging urban consumer class as ideal conditions for their expansion. Co-founder Sacha Michaud even stated, “The Ghanaian market is promising… we will continue to invest to reach all regions of the country.” By May 2023, they had shuttered operations, stating that “building a stronger position and achieving profitability would require substantial investment over an extended period.”
This rapid reversal deserves deeper analysis. Glovo’s European delivery model collided with distinctly Ghanaian infrastructural realities on multiple fronts. Without comprehensive street addressing systems, couriers spent up to 30% more time locating destinations compared to European markets, significantly reducing delivery capacity per driver. High and volatile fuel costs – which fluctuated by over 40% during their operational period – eroded already thin delivery margins in a business model where courier efficiency determines profitability.
The macroeconomic environment further compounded these challenges. While Ghana’s middle class is growing, the disposable income available for convenience services remained limited to a small urban segment, particularly as inflation reached 40% by late 2022. This created a pricing paradox: the service needed to be affordable enough for regular usage but expensive enough to cover the higher operational costs of delivering in Ghana’s urban centres like Accra and Kumasi. High taxes, low wages, and high inflation further worsened the situation. The situation was not unique to Glovo as Jumia ended its app-based food delivery service in Ghana, Senegal, and Egypt in 2023.
What makes this case particularly instructive is that Glovo’s exit doesn’t indicate the impossibility of delivery platforms in Ghana. Other competitors like Bolt Food Ghana continue operations. The difference lies in their business models: local platforms adapted to Ghana’s infrastructure realities from inception rather than attempting to transplant models optimised for different infrastructural contexts.
The case demonstrates that technology adaptation to African markets requires fundamental business model rethinking, not mere localisation. Simply translating an app interface or adjusting pricing isn’t sufficient when the underlying operational assumptions – from street navigation to logistics costs – differ fundamentally.
For entrepreneurs: Begin with infrastructure constraints, then design your solution – not the reverse. Map the actual physical journeys your service depends on, measure their true costs, and build models that account for infrastructure inefficiencies rather than assuming them away.
For investors: Realistic timelines in infrastructure-dependent businesses must account for physical, not just digital, development cycles. The “Africa discount” isn’t merely about market size but about the extended timeline required when scaling amid infrastructural deficits.
For policymakers: Digital transformation strategies must prioritise the mundane but critical infrastructure that enables digital business models – from addressing systems to efficient urban planning – not just flashy innovation hubs and fibre connectivity.
Success in African markets doesn’t come from ignoring infrastructure challenges, but from building business models that explicitly address them. Glovo’s experience demonstrates that even well-capitalised global platforms must adapt to local infrastructure realities or face retreat.
