Sendbox, the Nigeria-based e-commerce fulfillment platform for merchants in Africa, has raised a $1.8 million seed round.
The round was led by 4DX Ventures, Enza Capital, FJLabs, and Golden Palm Investments with participation from Flexport and YC Combinator as part of its 2021 winter cohort.
Sendbox’s total investment raised has now reached $2 million following a pre-seed round from Microtraction and 4DX Ventures in 2018. The company will use the new funding to expand its operations in other countries across West Africa, bolster the development of its product range, and hire new talent.
Reaching new buyers
Commenting on the recent fundraising and growth ambitions, Emotu Balogun, CEO and Co-Founder of Sendbox said, “No matter where in the world customers are, we want African SMEs to be able to reach them.”
According to Emotu, deliveries in Lagos, Abuja, Port Harcourt, and Ibadan have made up a large proportion of business for the company’s domestic merchants.
On top of that, he continues, “affordable access to the UK, EU, US and Canada has created an opportunity to sell products to hundreds of millions of previously unreachable buyers. With this fundraise, our aim is to support more and more SMEs and help them grow both locally and internationally, scaling alongside them as we connect African merchants with a global community of consumers.”
Starting with logistics and fulfillment, Sendbox is building the operating system for e-commerce in Africa. Launched in 2018, the company provides affordable access to local and international delivery options for small-scale merchants selling on e-commerce and social media platforms.
Accessible to iOS and Android users, via a web application, on Whatsapp, Facebook, Instagram, and other e-commerce platforms, and through developer APIs, Sendbox is providing a single location to manage both local deliveries and international shipments to the EU, UK, US, and Canada.
To date, over 10,000 Nigerian SMEs have sent 200,000 products through Sendbox, saving on average 30-40% per item by eliminating the need to work with separate logistics providers. Through its delivery management platform, which aggregates logistics providers and enables tracking, the company also offers a solution for merchants who lack the high volumes required to attract discounted delivery fees.
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The road ahead for Sendbox
The next stage of the company’s growth will see a move towards financing & payments, followed by e-commerce & marketplace integrations across West Africa and then further afield.
As a sector-agnostic platform, Sendbox is available to sellers right across the spectrum, empowering designers, micro-manufacturers and entrepreneurs who produce their own goods and distribute them on behalf of others.
In terms of products, Clothing, Fashion & Lifestyle, and Beauty & Self-Care have been most prominent since launch, while the company expects other categories to grow rapidly as SMEs continue to expand their customer bases.
Prolific mobile penetration on the continent, the rise of social media, and knock-on impacts from the COVID-19 pandemic have shifted additional momentum towards e-commerce and social commerce, doubling monthly revenues for Sendbox since March 2020.
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Made in Africa products are now in higher demand across local and international markets. With 200 million Instagram users and 1 million Instagram businesses in Nigeria alone, Sendbox is well-positioned to serve this growing market and multiply its merchant count over the coming months.
“African e-commerce is accelerating faster than anybody could have imagined a decade ago and it needs smart solutions to ensure that logistics and fulfilment capacity doesn’t lag behind,” said Walter Baddoo, co-founder and General Partner at 4DX Ventures.
“Not only were we impressed by Sendbox’s 300% year-on-year growth since launch, but we’re seeing the market potential balloon with over 40 million Nigerian SMEs and a projected industry value for social and e-commerce reaching $45 billion on the continent by 2025.”
Africa’s e-commerce market is expected to be worth $75 billion by 2025. With merchants’ need for e-commerce fulfillment growing by the day, new companies are poised to spring forth in the coming years.
