South Africa’s Orderin raises $4.7mn

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South Africa’s Orderin raises $4.7mn
Credit: © Reuters.

Orderin, South Africa’s only pure Delivery-as-a-Service (DaaS) business with 100% proprietary technology, has raised $4.7 million (R70 million) in a recently closed pre-series B funding round. The funding will allow the business to scale up infrastructure, and enhance last mile delivery, which continues to be a pain point for many businesses, particularly small and medium sized enterprises (SMMEs).

The money raised in this latest round of funding brings total investment to R303 million, having raised R6.5 million in pre-seed funding, R38.5 million in seed funding and R285 million in operational capital between 2018 and October 2021. This supplements the delivery network’s biggest round of funding which raised R102 million in 2020. Orderin Chairman, Dr Lutz Mieschke, owner of Mieschke Investments in Switzerland, is one of the main investors among 25 investors since founding Orderin in 2013.

“E-commerce has been growing steadily over the last few years but the Covid-19 pandemic has rapidly accelerated this growth. Customer expectations have placed demand on businesses for easy, quick and sometimes even free delivery options,” says CEO of Orderin, Thembani Biyam. “Driving the growth and development of infrastructure will not only improve last mile delivery and make it more accessible for businesses. This applies especially to SMMEs who can find it difficult to compete with larger enterprises on this point, but can also usher in a new future of e-commerce.”

According to a recent report by World Wide Worx, South Africa’s online retail market has more than doubled in the two years defined by the Covid-19 pandemic. E-commerce grew by 66% in 2020 with online sales reaching R30.2 billion and projected to top R40 billion in 2021. Biyam notes that emerging technologies are playing a huge role in enabling businesses to meet this high consumer demand when it comes to last mile delivery. “Businesses often have to deal with costly and inefficient last mile delivery due to challenges such as unpredictable timelines, the need to make multiple stops with only a small number of parcels being dropped off at each destination, congested traffic and more” says Orderin Head of Finance, Vulnavia Gura.

“Digital technologies such as Artificial Intelligence and data science can improve last mile delivery by finding the best routes to take to avoid traffic, the most efficient use of fuel, or even better predict demand and labour requirements. These technologies play a crucial role in enabling dynamic predictive models which permit our customers to circumvent these challenges at the speed needed for successful delivery. However, it is costly. The funding we raise allows us to scale our talent, tech and offering as we grow our customers and revenue.”

According to Biyam, the funding will assist Orderin in scaling its proprietary DaaS 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.

Orderin, which currently provides delivery services for the likes of McDonalds and Pick n Pay (JO: PIKJ ), one of South Africa’s largest supermarket chains, employs 120 people, and has created delivery opportunities for a further 2000 people. The funding will allow Orderin to grow the headcount to 200 and expand the delivery platform and delivery partners to 3000.

“We are moving quickly to mature our operational and governance models — our investors demand it and our stakeholders expect it. We believe that as a young company entrusted with investors’ funds we should create a reputation for prudence. This will engender confidence in future funders,” says Gura.

“The reason we built our own proprietary tech is because a lot of the global DaaS platforms just didn’t provide the depth and flexibility necessary to deliver services in alignment with our mission to enable best in class online fulfillment locally and, regionally,” adds Gura. “We’ve worked with many partners over the years; some have invested, some as product development partners, and others in running pilot programs. As a business in its growth phase, creating value for all our partners and clients is a balancing act, but I strongly believe that our commitment to achieving this is what powers our growth.”

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