#TCMobility: More Investors are Pouring Cash into Africa's Logistics Startups

(L-R): Obi Ozor; CEO, Kobo360, Toyin Oshinowo; VP Product, FieldInsight, Uche Ogboi; COO, Lori Systems and Bankole Oluwafemi of TechCabal as Moderator.

Investor interest in Africa’s logistics industry is growing in recent years. Over the last two years, African logistics startups have raised millions of dollars from investors. But according to Obi Ozor, CEO of Kobo360, there is a growing realization that without efficient distribution and supply chain operations, businesses like agriculture and e-commerce will not scale.

Speaking at the TechCabal Mobility Townhall, Ozor said: “At some point, they [e-commerce companies] were able to prove the concept, but they were not able to scale. And the challenge was supply chain.”

He explained that the supply chain is no small challenge for African businesses. “Supply chain is not that easy because it requires a lot of infrastructure and other things. So it’s not a startup that anybody can just jump in.” Ozor said.

“Then you started seeing the need that without a supply chain and distribution platform, this e-commerce can’t scale.”

But it’s not just e-commerce, the dearth in logistics and supply chain operations in Africa makes it inefficient for several businesses to operate at scale. From agriculture to clothing to exports, supply chains affect the cost of doing business.

According to Uche Ogboi, COO of Lori Systems: “The cost of moving goods in Africa is among the highest in the world.” She adds that while “75% of the price that consumers pay being attributable to logistics, [it is] 6% in the US.”

Obi predicts that fixing the problems in the logistics industry will enable e-commerce and the entire economy. This is something that excites investors and has helped to push companies like Kobo360 and Lori Systems to higher funding rounds. This week alone, two North African logistics startups, TemTem and MaxAB secured over $10 million in funding.

Expect more funding to follow as investors identify startups addressing this challenge in Africa.

But Ozor doesn’t expect this fix to come swiftly. He says that over the next five to ten years, and with collaborations, the “ecosystem will kind of mature” and provide the data and insights needed for multiple sectors to boom.

Read this next
Business, Guest Post, Opinion, Policy
26th September 2019

Mobility addresses both the movement of people and goods and sits at the intersection of both the physical and digital worlds. The broad application of technology to challenges that require attention to both technological and operational factors is yielding exciting developments globally that may fundamentally change how both people and goods move across small and […]

More From TC

Social media giant, Twitter is setting up its first African office and it will be in Ghana. The announcement was made through a tweet by Twitter CEO Jack Dorsey where he thanked the president of Ghana Nana Akufo-Addo. The tweet also included a link to a post on Twitter’s official blog written by Kayvon Beykpour, […]

The directive of the Nigerian Securities and Exchange Commission (SEC) issued on the 8th of April, 2021 has been met with consternation and a straightforward (but hopefully simplistic) interpretation that the government is out to stifle innovators – again. These perspectives aren’t unfounded, as innovators of all shades have taken a heavy beating lately due […]

Last week, Ampersand, Africa’s first electric motorcycle company, secured a $3.5 million investment from the Ecosystem Integrity Fund (EIF). This is the largest ever e-mobility investment by a venture capital fund in Sub-Saharan Africa and could hint at a turning point in African electric transport. Based in Kigali, Rwanda, Ampersand assembles and finances electric motorcycles […]

Africa is home to the fastest-growing population globally, with numbers expected to rise by nearly 50% over the next 14 years, growing from 1.2 billion people today to over 1.8 billion in 2035.  As the population increase outpaces economic growth, much of Africa’s youth, who account for most of the population, are moving into urban […]


TechCabal is a Big Cabal Media brand



Copyright © 2013 - 2021
All rights reserved

Privacy & Terms
X