Lori Systems, an African on-demand logistics and trucking startup that digitises haulage and offers shippers options to manage their cargo and transporters, has secured a pre-Series B investment in which Google and other previous investors participated.
According to sources, the company raised at a somewhat higher valuation than its previous $110 million valuation in 2020.
With the additional funding, Lori hopes to expand her product lines and turn a profit. Co-founder and chief product officer Jean-Claude Homawoo added.
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Why The Google Invested
Lori Systems has generated considerable traction since it was founded. In a statement, Lori said that since its introduction in 2016, it had aided tens of thousands of shippers and carriers transport more than $10 billion in cargo across the continent.
It is unknown how much Google’s Africa Investment Fund invested in this round, as it did with Safeboda and Carry1st. However, it is worth noting that the fund, which, according to a spokesman, does not seek to lead investments but rather “partner with top investors who have a regional presence and local knowledge,” has mostly participated in extension agreements through convertible notes.
This unknown investment is Google’s third from the $50 million Africa Investment Fund, which was unveiled by company CEO Sundar Pichai last October and is aimed at the continent’s early- and growth-stage firms. The fund is part of Google’s five-year strategy to invest $1 billion on “tech-led initiatives.” The announcement follows the opening of Google’s first product development centre on the African continent, in Nairobi, Kenya, the place where Lori Systems was founded.
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Google launched its first investment in Ugandan super app SafeBoda in December. During the announcement, Sub-Saharan Africa managing director Nitin Gajria stated that the Africa Investment Fund would not be limited to specific verticals or areas.
“We are focusing on investments where we believe that Google could add value. If founders are building interesting products solving real challenges in Africa, that would fall squarely within our investment thesis,” he added. “At Google, we understand the transformative power digitization can bring to the African continent. There is so much potential in the region, but it’s only through innovation that this can be fully unlocked. Lori Systems is a great example of how technology can be scalable across Africa, and how, in turn, this can drive meaningful economic development.”
The fund participated in a $20 million Series A extension round for South African game publisher and studio Carry1st the following month, which was led by a16z. The Africa Investment Fund has an eye for startups that have a strategic overlap in important verticals like fintech, logistics, e-commerce, and local language content, according to a Google spokesperson when asked about the fund’s investment strategy in light of the fact that its investments have come from three different industries.
A Look At What Lori Systems Does
The Lori was established in Kenya in 2016 and offers on-demand mobile trucking logistics services through an Uber-like network of drivers and business partners. The firm operates in Kenya and Uganda in East Africa.
Lori’s CEO, Uche Ogboi, noted that since its last fundraising round, the company has been focusing on development, sustainability, and a route to profitability.
According to the CEO, the company has greatly expanded its product line and now offers a “fully digitised transport management platform,” which was developed in reaction to the pandemic, which disrupted shipper and transporter trade flows. According to her, its new offerings have tripled transaction volume and nearly doubled marketplace take rate.
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“At this stage in our journey, and in this current market, we made the strategic decision to extend our Series A rather than raise a Series B on unfavorable terms,” Ogboi said. “We are excited by this opportunity to partner with Google and expect to reevaluate our investment options sometime in the first half of next year.”
logistics trucking Lori Systems logistics trucking Lori Systems
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard. You can book a session and speak with him using the link: https://insightsbyexperts.com/view_expert/charles-rapulu-udoh