Kenyan-based digital trucking startup Amitruck has raised $4 million for regional expansion.
The firm, which has set its sights on Uganda and Tanzania, says it will also use the money to ramp up its technology and bolster its key operations such as sales, engineering, and customer success through hiring of talent.
The seed funding was spearheaded by San Francisco venture capital firm Better Tomorrow Ventures (BTV) and supply chain and mobility venture capital Dynamo Ventures. Others are Sennder GmbH, Rackhouse Ventures, Flexor Inc, Knuru Capital, Launch Africa Ventures and the Uncovered Fund.
“The most important purpose of this round is hiring. We are also improving our technology as we start our expansion into other countries in Africa,” Amitruck founder and chief executive officer Mark Mwangi said.
“We are thrilled about the positive response that Amitruck has received from cargo owners and transporters alike. Transport touches on almost every sector of the African economy and is crucial to its development; we are excited to be part of that journey.”
He added: “Thanks to the support from our investors, we look forward to expanding our footprint across Africa and bringing more carriers and shippers to our marketplace.”
Launched in 2019, the firm links shippers with transporters owning vans, trucks, tuk-tuks, pickups and motorbikes, enabling them to negotiate the rates of their services directly with cargo owners through its web or mobile application, bypassing middlemen. This is aimed at fostering transparency and efficiency in transport.
Transporters bid for work on the platform, providing competitive prices, while cargo owners have the advantage of a menu of competitive offers and can choose a transporter based on price, rating and experience.
The company currently has more than 300 business-to-business (B2B) clients, including big multinationals such as L’Oréal, Unilever, Twiga Foods and SkyGarden. It boasts about 8,000 vehicles, which have undertaken almost 100,000 deliveries in two years.
The tech startup is now focused on a bigger share of Africa trucking and logistics market, which accounts for almost 80 per cent of transported goods
“Amitruck connects shippers directly with transporters and provides a platform where you can get secure competitively prices transport,” Mr Mwangi stated.
BTV’s general partner Jake Gibson said Amitruck was selected for investment due to “its high level of innovation and a growing need for its services”.
“As an investor in unicorn CloudTrucks here in the US, we have in-depth knowledge of the operational and financial requirements from truckers,” Mr Gibson noted.
While the trucking and logistic business in Africa has grown tremendously over the years, the pace of innovation particularly in its administration has been slow. Amitruck’s solution is ideal for bringing the industry into the 21st century.”
Venture capital and private equity funds have found Kenya a rich ground for investing in startups in previously underserved and fast-growing sectors of the economy in the past decade.
They are attracted by high returns, although risk is high, with family offices and finance institutions in the west providing them with capital.
Such funds provide local startups and SMEs with the much-needed capital that they would otherwise struggle to get from formal financial institutions such as banks, while also providing technical expertise that the small firms need in order to grow their operations.
This comes at a time when Kenyan startups are securing record fundings from international investors for expansions.
Less than three months ago, agricultural tech start-up Twiga Foods raised Sh5.56 billion from foreign investors such as private equity firm Creadev as well as TLcom, IFC ventures, DOB Equity and Goldman Sachs, among others.
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