This year is looking more favorable to Egyptian startups already. The latest startup to join the fund-raising train is Bosta, the Cairo-based startup that provides different types of last-mile delivery solutions to ecommerce businesses in Egypt. The startup has raised more than $1 million in Series A round of funding from the European parcel delivery giant DPDgroup.
“We are thrilled to be one of the key pillars of this movement, and DPDgroup’s investment only solidifies our role even further,” Bosta’s co-founder and CEO Mohammed Ezzat
Here Is The Deal
- Led by European delivery giant DPDgroup, Egyptian payments company Fawry that went public last year and which had previously invested in Bosta in late 2017 also participated in the round.
- Bosta plans to use the investment to grow further and lead the ecommerce delivery market in Egypt.
- The startup also plans to explore the option of expanding to some other regional markets and it now has a great partner in form of DPDgroup to help it realize this vision.
Why The Investors Invested
Although this round of investment was led by the DPDgroup, Egypt’s leading payment company Fawry also participated. According to a statement by Fawry on the occasion of its investment in Bosta in 2017, Bosta’s vision ‘‘complements our vision to scale ecommerce in the Egyptian Market, we are proud of the fact that Egyptian talent is capable of providing world class technology solutions” said Ashraf Sabry, Chairman & CEO of Fawry.
On its own, DPDgroup is a subsidiary of LaPoste, an international delivery network operated by the French state-owned postal service. So, its investment in Bosta is somewhat some validation of Bosta’s significant track records; and the fact that the investment by the group also includes a partnership between the two companies shows that this may be a strategic market entry move by the group, which according the statement by Bosta, is Europe’s second-largest operator in the courier, express and parcel (CEP) industry, delivering over 5.2 million parcel every day.
The European delivery company has been investing in logistics businesses in different parts of the world (which also includes $85 million investment in Southeast Asian last-mile logistics startup Ninja Van) but Bosta is company’s first investment in Egypt and it now aims to bring all its support for Bosta in Egypt and beyond.
Read also: Egyptian Startup NowPay Raises $600k In Seed Funding To Grow Business
A Look At What Bosta Does
- Launched in 2017, Bosta provides different types of last-mile delivery solutions to ecommerce businesses in Egypt. It provides these businesses with next-day delivery, handles exchange shipments, customer returns and cash collection. The startup claims to have a 97 percent successful delivery rate.
- The startup doesn’t own the fleet or have salaried drivers. It instead uses an Uber-like asset-light model with all the drivers on its network being freelancers who earn money for every completed parcel delivery.
- The startup that has served over 5,000 businesses in Egypt to date has grown over ten times in the last twelve months to be delivering 150,000 parcels a month now, Bosta’s co-founder and CEO Mohammed Ezzat claimed.
- Fetchr, one of the leading logistics startups of the Middle East & North Africa has been struggling lately and had a massive downround late last year but that hasn’t given Ezzat any sleepless night. He thinks they failed because of their own vision and mistakes. “If you look at the logistics sector, you also see a lot of successful companies operating around the world and we’ve been witnessing massive growth at Bosta.”
- In a statement, he also said that the ecommerce industry in Egypt and the entire region is looking very positive and he’s right about it. According to a recent report by Bain & Co., ecommerce is expected to grow to $28.5 billion in MENA by 2022 from $8.3 billion (it was at, in 2019). Egypt is expected to grow 33% annually to reach $3 billion by 2022.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer.
He could be contacted at udohrapulu@gmail.com