Topship has secured $2.5 million in a seed round, just months after finishing the YC winter batch. Its main investor is Flexport.
Y Combinator, Soma Capital, Starling Ventures, Olive Tree Capital, Capital X, and True Capital are among the other investors. Mercury CEO Immad Akhund and Dropbox co-founder Arash Ferdowsi are among the individual investors in the round.
When co-founder and CEO Moses Enenwali recognized an increase in merchants’ needs for delivering parcels and goods beyond Nigeria during the pandemic in 2020, he launched Topship.
Following his stint with transportation company ACE Logistics and e-commerce fulfillment supplier Sendbox, he developed ties with these merchants.
During his time with both organizations, from 2015 to 2020, the need was consistent, but this was unique. With Junaid Babatunde as CTO, Topship became operational in March 2021.
Topship claims to desire to make it as simple as possible for African businesses to send and receive parcels and cargo to their customers, suppliers, and distributors around the world.
The startup, along with competitors such as Sote, SEND, and OnePort365 aims to improve Africa’s overall shipping experience.
Topship, on the other hand, has high ambitions, stating in a statement that its objective is to make shipping in Africa as simple and stress-free as scheduling an Uber ride.
One reason that may work in its favor is its focus on air freight, even as others look to replicate Flexport’s mix of air, ocean, and truck haulage.
Topship, according to Enewali, enables 1,500 businesses to ship cargo and packages from Nigeria to more than 150 nations.
Although it can assist Nigerian merchants in receiving parcel delivery in the opposite direction, it can only accept cargo deliveries from the United States, the United Kingdom, and China.
The startup makes money by selling shipping insurance and collecting a cut of every transaction. According to Enewali, the company is looking at other revenue streams such as trade financing and customs clearing fees. Since joining YC in January, the company has grown its sales by 50% month over month.
Topship was invited by merchant organizations from Ghana, Tanzania, and Kenya late last year to assess the feasibility of launching in their local markets. Enewali claims that the new investment will allow Topship to move forward and begin operations in the United States.
In addition, he said, a portion of the money would go toward improving asset-light technologies and developing a proprietary global transportation infrastructure that would make imports and exports much faster and easier.
As a gesture of “assistance for the future of the booming e-commerce sector” in Nigeria, Topship has put aside some money in fashion design and retail grants worth $3,500 each to reward new and established fashion firms.
Techbuild’s Take
In Africa’s e-commerce industry, there are several potentials for small firms to grow and larger businesses to reach an invigorated consumer market.
Many Africans, particularly young people, utilize the internet, and online shopping is becoming more popular as a result of technological advancements.
As a result, shopping in other nations is extremely possible, however, delivery can be an issue.
International shipping is a pain for the average African retailer. Outrageous fees, logistical difficulties, hidden fees, and customs clearance unpredictability are just a few examples.
Demand for online shopping and improved connection in Africa has paved the way for the establishment of e-commerce platforms like Topship.
Topship serves a diverse user base. Topship is a borderline local and international shipping solution between digital freight and e-commerce fulfillment, from a merchant moving tons of heavy equipment and a solo business owner sending packages to a student sending documents to a school overseas and a Gen Z shopping from a distant store. Trella, Flextock, ShipBlu, Sendbox, and Freeterium are among the African firms that Flexport has funded.
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