Orderin, South Africa’s Delivery-as-a-Service (DaaS) business which currently provides delivery services for the likes of McDonald’s and Pick n Pay, has raised $4.7 million (R70 million) in a recently closed pre-series B funding round. This funding will enable the company to expand its infrastructure and improve last-mile delivery which is still a problem for many businesses, especially small and medium-sized companies (SMMEs).
This latest round of funding brought total investment to R303million. It has raised R6.5 million pre-seed funding and R38.5 million seed funding. R285 million was used for operational capital. The funding spans 2018-2021. This funding adds to the largest round of funding for delivery network, which was R102 million in 2020. Orderin Chairman Dr. Lutz Mieschke is the owner of Mieschke Investments, a Swiss company that has been one of 25 investors since the founding of Orderin in 2013.
“E-commerce has grown steadily over the past few years, but the Covid-19 pandemic accelerated this growth. According to Thembani Biyam, CEO of Orderin. Customers have put pressure on businesses to offer quick, easy and sometimes even free delivery options. “Driving infrastructure growth and development will improve last-mile delivery and make it more accessible to businesses.” This is especially true for SMMEs, who may find it difficult to compete on this point with larger companies. However, it can also help usher in a new era of e-commerce.
A recent report from World Wide Worx shows that South Africa’s online retail market more than doubled over the past two years since the Covid-19 pandemic. E-commerce saw a 66% increase in sales in 2020, reaching R30.2 million. This figure is expected to rise to R40 billion by 2021. Biyam points out that new technologies play a significant role in enabling businesses meet high consumer demand for last mile delivery. Vulnavia Gura, Orderin Head, Finance, says that last-mile delivery can be costly and inefficient. This is because of challenges like unpredictable timelines, multiple stops, limited parcels being dropped off at each destination and congested traffic.
“Digital technologies like Artificial Intelligence (AI) and Data Science can help improve last-mile delivery. They find the best routes to avoid traffic, make the most fuel efficient, and even predict labour demand and labor requirements. These technologies are crucial in creating dynamic predictive models that allow our customers to avoid these problems at the speed they need for delivery success. It is however costly. We can increase our tech, talent and offerings as we grow our customer base and revenue with the funding we raise.”
According to Biyam, the funding will assist Orderin in scaling its proprietary delivery-as-a-service technology with its current client base in the short term, launch DaaS for SMMEs in the medium term, and establish a flywheel for its long-term goal of providing a platform for all types of business to get access to a variety of affordable eLogistics services to keep them competitive and help grow their businesses. The company will also expand its delivery platform and increase its delivery partners to 3000, as well as increasing its headcount to 200.