Fez Delivery, a Lagos-based last-mile logistics startup across Nigeria, has raised $1 million led by Pan-African Investor Ventures Platform with Voltron Capital, Acacia Ventures and other angel investors.
CEO Seun Alley said in a statement that the company plans to use the seed investment to expand its operations in Nigeria (which has a $10 billion transport and logistics market) – from Q4 2023 – to other African markets, including Ghana. , Kenya and South Africa. The startup intends to improve technology and operational efficiency, hire more talent and increase its marketing spend.
Having worked in the Nigerian banking sector for over a decade and later in startups such as Opai, Block and Move, she founded FezDeliver in 2020. She opened it two years ago as a B2B cleaning service and side hustle. While running the business, Alley received many complaints from her customers about the cleaners: even though they did a thorough cleaning in the morning, they weren’t around to do the necessary touch-ups the rest of the day. “We understand that this is because janitors are doing a lot of work for our customers,” the CEO told TechCrunch. “The reason for this, we learned, is that most of the places where you buy things do not have delivery or logistics services.
The situation is unique to many businesses in Nigeria, as Ali did a simple market research before launching Fez Delivery. Alley spoke with entrepreneurs and small business owners, both outside and in her circle, to ask about their top concerns: talent and logistics topped the list.
while lWhile Augustics is one of the fastest growing industries in Nigeria, it is also one of the most fragmented. The sector is still nascent in many parts of Africa and although millions have been poured into start-ups – operating in various aspects from freight to the last mile – they have yet to build sustainable businesses that have barely scratched the surface. Meanwhile, in the last mile categoryPageRice, arrival and delivery times are common headaches faced by startups and small businesses. These features According to Alley, phased delivery solutions facilitate this. Individual customers can access the Services through mobile and web applications to place and track orders, manage spend, collect data at specific trading points and make payments. On the other hand, the startup offers APIs and dashboards to its business customers. Fez Delivery claims to have over 17,000 customers using its platform (70% are individuals and 30% are a mix of SMEs and startups).
Last year, he launched a two-year startup Vertical: FEZ for Fintechs, helping fintechs deliver debit cards and POS terminals to all their customers and agents in Nigeria. To meet the demand, Fez Delivery recently developed a SaaS platform to use trained third-party two-wheeler logistics platforms to help fulfill orders it cannot fulfill by supplying a fleet of five to 10 ships. These partners share in Fez Delivery’s revenue by charging individuals a monthly fee (based on the distance and size of the items) and businesses a monthly Flash payment subscription (based on the set of deliveries).
Fez Delivery said it completed 200,000 trips last year and grew revenue by 20 percent per month. Their client base includes the likes of Flutterwave, Cuda Bank, MoneyPoint, OPI, Red Bull and Pharmacy Africa.
The Techstars Toronto-backed platform faces competition from startups including Uber in Nigeria with its Uber Connect product, Kwik Delivery and Gokada, among others. Alley argues that Fez Delivery’s differentiator is in the model; While others work to order, her company is a hybrid of the on-demand and center-and-spoke model. “We pick items from customers in bulk and take them to a central location where they are stored before being assigned to drivers for completion,” she commented. “So I like to mention that Fez is running a hybrid model. We have the technology and we still own 30% of the assets on our platform. What that does is we have a backup if the third-party partners don’t come for any reason and we can complete our delivery ourselves. So for us, we have a large number of assets while providing the technology. We think it will give us a big place.
Speaking on why Ventures Platform invested, Dotun Ololoporoku, General Partner of Ventures Platform, said in a statement that his firm’s decision to support Fez Delivery is a technology that allows other market players to thrive and is well aligned with the company’s investment case study. Support market-creating innovation in underserved industries such as logistics.
I understand that we can build and create solutions around payments and mainstream fintech. But there are other problems in the ecosystem that no one is looking at, and one of them is logistics,” Alley said when asked why she was building in the logistics and shipping space instead of fintech with her many years of experience.
