Logistics in much of Southeast Asia is not only complicated but also expensive. Deliveree wants to solve that problem with a platform that not only allows customers to book trucks, but also uses algorithms to determine the best route based on location, truck load, and even weather. The company announced today that it has raised a $70 million Series C led by Gobi Partners and SPIL Ventures, with return investor participation Inspire Ventures. This brings the company’s total raised to date to $109 million since it was founded in 2015.
Founder and CEO Tom Kim said: “High logistics costs mean higher prices for consumers. “The way we see the market as number one, inefficiencies in trucking and freight have increased physical costs. Imagine you are in California, Los Angeles and buy a pair of Nike shoes. What part of that cost of sales is spent on logistics and shipping and warehousing? The answer is very well documented. It’s about 8%. If you buy that same pair of Nike shoes in China, the answer is about 15%. And if you buy the same pair of Nike shoes in Indonesia, Thailand or the Philippines, the answer is much closer to 25%, maybe up to 30%. “
The company said that in the past 24 months, the total transaction value has increased 3.2 times and will exceed $100 million this year. It currently has 500 employees and 100,000 drivers on its platform.
Deliveree is currently available in Indonesia, Philippines and Thailand. It focuses mainly on large trucks that move commercial goods or large items. Kim said that based on Google Analytics, it is searched more than other logistics companies. Including WaresixGo Box, Kargo Tech and Reasonable in Indonesia; Mober, Inteluck and TheL Sorry in the Philippines; and Giztik, TheLworthy and Ezyhaul in Thailand.
Kim added that the logistics battle is particularly hot in Indonesia, where many logistics startups, like Waresix, have received funding.
“That’s where a lot of startups and disruptive technologies in the space are being built, and it’s certainly a very dynamic market,” he told TechCrunch. “There are all the famous players like Waresix or even Kargo Tech. The Philippines and Thailand are also interesting and great markets, but there are fewer players in the logistics sector, especially in cargo, trucking and freight. “
One of the problems Deliveree addresses is the inefficient use of trucks. For example, trucks deliver a load of goods, but then return empty goods to the warehouse. However, if it’s part of Deliveree’s system, companies can set it up to ship items on the way back. That makes better use of money spent on fuel, time and crews.
“There are a lot of empty trucks going around in Thailand, the Philippines and Indonesia, because everyone has their own company fleet,” Kim said. “They delivered a one-way delivery and the truck came back empty. It even works that way for long-distance deliveries, when you send goods from a warehouse to some facility in another city. The same thing happens — you let the truck go all the way one way and it comes back, sometimes hundreds of kilometers, empty.”
Deliveree addresses these issues with a dynamic market, which Kim says currently has tens of thousands of customers and suppliers, including a mix of independent drivers and trucking companies. The market’s technology, combined with its volume, can identify customers both ways on a truck’s journey, so it rarely runs empty. The market aggregates demand and determines optimal routes for trucks to remain full. Kim says that prior to Deliveree, usage rates of 40% to 50% were considered above average. With Deliveree’s marketplace, however, trucks can achieve up to 80% utilization, thanks to Deliveree’s in-house generated dataset, which has been in development for 5 years.
“Although it is far from perfect, it is getting smarter every day because we make thousands of bookings every day and it can give more accurate forecasts of booking times, days of the week , time of day, even weather. . These are all things that have a strong impact on duration,” says Kim.
This also means warehouses have shorter queues, as Deliveree’s algorithms can predict what loading and waiting times will look like.
Most companies have their own fleet of vehicles, which means hiring dispatch teams, administration teams, security teams, parking lots, and security guards. Kim said this is still the way to stand out and means a lot of overhead for companies. Kim said his argument for introducing Deliveree to companies was how they could reduce balance sheet leverage and put trucks on a light asset basis. That means they only pay for the truck when they need it. As the pandemic hit, many companies’ revenue went down, and Kim says that led to more Deliveree adoption as they tried to increase revenue. This increases Deliveree adoption, as many companies try to find ways to save money, to convert their fixed costs into variable costs.
Offer free money by charging customers and splitting that fee with service providers. Deliveree’s standard rate is 80% for the trucking company or independent trucking company and 20% commission for the company.
In a prepared statement, Gobi Partners chief executive Kay Mok said, “After the pandemic, we are moving into an inflationary environment caused by supply chain issues. Deliveree has built the best technology platform for its customers and this will enable them to optimize and reduce total operating costs for the logistics and transportation company. “
