Know How This Freight Aggregating Platform Struck One of Largest Early-stage Funding Rounds in Logistics Startups Space
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Logistics is one of the largest industries globally as it manages the entire circle of the industrial supply chain. But the growth pace of the sector is not very impressive, especially India reason being lack of good infrastructure, traditional processes, decentralized authentication, etc. However, most importantly, the industry far is distant from adopting latest technology which has made it less lucrative
But worry not, startups are here! In the past couple of years, considering the logistics industry traction, India has witnessed several logistics startups trying to solve multiple problems in this sector. In fact, one of them, Rivigo will soon enter the unicorn club.
One such startup is Mumbai-based Cogoport, a tech-enabled platform which connects exporter and importer to ocean and freight carriers using the price discovery model and cancelling out the interruption of third parties. The startup also provides various value-added services like live tracking and analytics about shipment and the delivery process.
Recently, the company raised its early-stage funding from Accel Partners. Even though the startup refrained from disclosing the amount raised, according to reports it’s somewhere between INR 40-50 and is considered to be one of the largest funding rounds among logistics startup.
Helping Entrepreneur India analyze this deal, Harsh Kumar, Co-Founder & Head, Product Development, Cogoport shares the following insights:
It's a multi-trillion dollar Industry globally, hence Kumar says the problem which Cogoport is trying to solve has the potential to help the startup grow.
Also, since the market is so big and there is hardly competition and hence, other players can continue to coexist.
“Additionally, the team along with the product conceptualisation was able to showcase the edge and entry barrier making it difficult for others to catch up fast,” he said.
There is an inherent requirement for technology in a tech-deprived international logistics industry. The day and age when each and everything has the technology, international logistics is far behind in terms of adoption - hence there is a definite need for technology-based solutions
Kumar shares, “Blockchain is the next step as the technology perfectly suits the sector where information needs to verified, stored and transferred with the data security in mind. We have blockchain labs, where we are experimenting with various use cases. Hopefully, one can see a good solution by end of this year.”
According to Kumar, Cogoport’s team is a blend of industry leaders along with technology and finance background giving it a well-rounded look along with rich experience which each of the founding team members brings in.
The Founder and CEO of Cogoport Purnendu Shekhar is one of the veterans in freight logistics space with over 22+ years. While Kunal Rathod, prior to serial entrepreneurial stints has worked with AP Moller Maersk group for a notable period.
Just like Rathod, Nishant Dalmia, Co-Founder and CTO is a serial entrepreneur and also have spent his time with Housing.com and Amazon. Additionally, Kumar is an ex-investment banker himself.
Cogoport claims to have received over 12,415 inquiries from over 3000 clients through its online platform. It has also 49,806 port pairs onboard.
India’s freight transport market is expected to grow at a CAGR of 13.35 percent by 2020 while the startup has reported an annual run rate of $10 million and ocean freight accounts for 95 percent of it.
In the next couple of weeks, Kumar says the startup will be serving more than 5000 clients
The logistics startup plans to use the forwards from the funding into product’s pan India expansion along with improving its global footprint.
“We are looking at a strategic location from where we can serve Indian customers and then going forward, international customers,” Kumar said while adding that, “As of date, we have offices in the Netherlands and Hong Kong.”