Fez Delivery, a logistics business, has announced a $1 million initial financing.
Acasia Ventures (previously Cairo Angels), Voltron Capital, and other angel investors joined Acasia Ventures (a subsidiary of Techstars) in leading the investment round.
This financial news comes after Fez Delivery was chosen as one of just two logistics startups in Nigeria to get financing from Techstars Toronto, a prominent international innovation accelerator.
Seun Alley founded Fez Delivery in 2020 as a departure from her previous company, which supplied cleaning services to businesses but struggled with employee absenteeism caused by janitors running errands.
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Cleaning Services Company 2016 Launch
This cleaning services company was launched in 2016.
According to Seun Alley, the following year, there was a pattern of janitors missing work because they were conducting errands for staff members.
‘‘As a stopgap measure, we supplied delivery services to the businesses with which we were cooperating so that our janitors could focus on their tasks.
That was a smashing success. This experience taught us that last-mile logistics is a critical problem for SMEs and individuals. We decided to address this issue by creating a platform that allows consumers and organisations to track their items online in real time without the need for several logistical partners.’’
Logistics is one of Nigeria’s fastest-growing industries, thanks to the explosive expansion of online shopping, which is expected to generate $5 billion in sales in 2019 and a CAGR of 20.5% over the next five years. As a result of the magnitude of this potential, several logistical businesses have sprouted up around the country. However, many people find it challenging to differentiate themselves from their competitors while also running a profitable business.
How Fez Delivery is faring
Fez Delivery distinguishes itself in the industry by offering specialised and hybrid solutions that combine technology and physical touchpoints to serve its clients. According to Seun Alley, “our lessons learnt over the last seven years have revealed that numerous corporate agendas exist surrounding last-mile delivery.”
The pharmaceutical sector values on-time delivery, and SMEs seek competitive prices. As a result, we have developed a wide range of technologically enabled solutions, such as dashboards and APIs for enterprises, mobile and web apps (aimed at people), and physical reach that spans all 36 Nigerian states, including the Federal Capital Territory.
To recuperate costs, the three-year-old company charges clients each delivery and businesses a monthly membership.
In 2022, the logistics start-up made 200,000 trips and increased its revenue by 20% month over month.
Among its clients are Flutterwave, Kuda Bank, Moniepoint, OPay, Famasi Africa, and Red Bull.
Toheeb Azeez, marketing manager at Redbull Nigeria, adds that Fez Delivery’s shipping service has been dependable and competitively priced for our company since its inception.
Because of their vast reach across all 774 local governments in Nigeria, we can simply deliver our things to our customers quickly and effectively.
In addition, their prompt and polite customer service has astounded us.
On how they would use the funding, Seun Alley noted that the business would maintain pushing for the use of technology to address important concerns.
As a result of this investment, we are rebranding as a full-fledged digital organisation with an emphasis on last-mile delivery.
While the platform is being created, interested parties can join a queue.
“Our ambition has always been to build something that is actually innovative,” says Oluwafemi Jose, CTO and co-founder, “and we can’t wait to use this money to deepen our development efforts, grow our workforce, and accelerate innovation in order to better serve our partners and consumers.”
“We are happy to join with Fez Delivery in their mission to increase the efficiency of the logistics business,” says Dotun Olowoporoku, general partner at Ventures Platform Fund.
This industry is characterised by high degrees of fragmentation, supply-demand mismatch, and lack of transparency due to the substantial use of manual operations.
Seun is an amazing operator. He is a veteran founder with a strong vision for the future of last-mile deliveries. ‘‘Fez Delivery is consistent with our investment philosophy of fostering market-making innovation in underserved industries by developing technology that assists other market participants in succeeding.’’
Before expanding into other African markets, Fez Delivery will continue to concentrate its efforts in Nigeria.
“Our current focus is on Nigeria’s $10 billion transport and logistics business, where there is still room for expansion; we intend to continue growing in Nigeria and enter other markets beginning in the fourth quarter of this year; although we haven’t decided on the ranking yet, Ghana, Kenya, and South Africa are on our radar.”