Logistics Investment | Indonesia's Most Funded Logistic Startup Companies

Merdeka.com - We’re here with our mid-year 2020 ranking for logistics investment in Indonesia’s red hot venture funding scene for trucking and cargo logistic startup companies. Despite the Coronavirus pandemic and the world grinding to a halt, this has not stopped venture capital flows into the logistics investment space in the world’s third most populous country. The first half of this year has already seen several sizable growth stage funding announcements into disruptive startups.

In light of this, we sense a battle of epic proportions brewing amongst Indonesian logistic startup companies eager to spend this cash to gain market dominance in search of the ultimate goal: the solution to my epically named 30% problem. If you haven’t heard of the 30% problem, keep reading after the ranking table, I’ll explain it below.

Indonesias Most Funded Cargo Logistic Startup Companies

Source: Crunchbase and other publicly news sources up till June 1, 2020

Haven’t heard of the 30% problem that every startup logistics company is tryng to solve? I’ve written about this before in other articles about logistics disruptive startups. Indonesian businesses generally spend about 30% of the sales price their goods on logistics. Most of this logistics investment is spent on road transport which relies on Indonesia’s rather traditional trucking network made up of some company fleets but mostly hundreds of thousands of small trucking outfits and individually owned trucks spread throughout the archipelago (but with a heavy concentration in Java). 

What is the benchmark Indonesia should be striving to achieve? North America and Western Europe has achieved an average spend rate of 8-10% of sales price on logistics costs.

Using Indonesia’s expected 2020 GDP of USD 1.16 trillion (according to the ADB’s April 2020 forecast factoring in the impact of Covid-19), this equates to a sizable savings of USD 232 billion annually for Indonesian businesses if they can reduce their transportation costs from 30% to 10% of sales price. This is where each startup logistics company on our list comes into the picture.

Not surprisingly, the race to solve the 30% problem has become the ultimate goal of the disruptive startups on this leader board. Mind you, each of the logistic startup companies are approaching the problem differently with their own tailored logistics solutions. In fact of all five names on this most funded list, none of these disruptive startups are pursuing the same strategy (each is deploying their fundraised logistics investment capital differently).

Let’s take a deeper dive and have a look at Indonesia’s top 3 most funded trucking and cargo logistic startup companies on this list, shall we? In order of appearance, we have... 

DELIVEREE LOGISTICS

First Most Funded

Indonesia’s most funded startup logistics company is Deliveree. Their app powered marketplace available on Android, Apple, or web. Their app instantly assigns truckers to customers for FTL bookings and manages the booking process through to completion. To customers, Deliveree is a full service trucking solution while behind the scenes, it’s actually a large vendor marketplace with protocols to provide services according to strict standards.  

Source: News sources, Google Analytics, Google Play, Crunchbase

Deliveree’s prices are set internally and are not negotiable. To check their price, click cek ongkir. From their website, we could see that there is a fixed price per vehicle to start and then a price per KM thereafter. When we asked their CS how they set these prices, their CS informed us that Deliveree regularly rebids its prices out to its tens of thousands of vendors and adopts the lowest bid prices as the official prices on its platform. The prices we saw on their price calculator were very competitive to price checks we ran on other apps.

When we booked Deliveree, we first noticed the large selection and numerous logistics service options and driver preferences. We were assigned a truck driver quite quickly by the app. The driver texted us to confirm and he arrived in less than an hour to load a full truck worth of things. The app had signatures, photos, live tracking, live chat with driver, customer support options, and the ability for me to amend my booking.

How good is their solution? Deliveree efficiently covered the customer experience from assignment through to booking completion. It was ideal for us because we were looking for a full service solution rather than just a sourcing broker. We especially liked Deliveree’s app that monitors and manages the booking through to completion with digital signatures, photos, and regular monitoring by their CS who called us to inform us that the driver was arriving early and again when the driver needed help finding the delivery recipient at the destination.

What we think of the service? They have built a comprehensive and fully realized service. Solid tech and customer experience from matching all the way through to delivery completion. As a customer, we rate it 9 out of 10.

Their traction? They are big. Although the company doesn’t formally disclose it, our sources tell us daily volumes are 3,000-4,000 trucks a day and growing. Their Android mobile app has half a million downloads with a 4.8 score out of almost 12,000 reviews. Traction score is 9 out of 10.

KARGO TECHNOLOGIES

Second Most Funded

Our second startup logistics company is Kargo Technologies who operates a classic web load board (they also have a new Android app). Customers can post shipments on their load board and trucking vendors bid on those shipments. 

Source: News sources, Google Analytics, Google Play, Crunchbase

What makes Kargo pleasantly different than many other disruptive startups is that its load board is responsive. Our own testing showed there are numerous vendors who bid quite quickly. Our test load received 7 bids from vendors within just a few hours (3 prices were competitive and 4 were on the high side). The vendors ranged in sized but can be generally described as small trucking companies. In addition, Kargo’s user interface is modern and great to use. Kargo primarily serves a front end matching engine. After you choose a trucking vendor, you’re mostly on your own to work things out with them in a bespoke manner that works for both parties.

How good is their solution? Kargo uses an open bidding system to bring customers the lowest possible price for their shipment. Their model sacrifices some degree of speed and convenience compared with other disruptive startups (the process of negotiating and coming to terms with the vendors does take time) but it should reliably produce the lowest competitively possible price. In other words, good things come to those who wait. Moreover, Kargo is primarily a front-end solution and does little to manage the ultimate outcome of the cargo delivery. That will be attractive to businesses with team who can manage the process and less attractive to small businesses who don’t have the oversight staff or infrastructure.

What we think of the service? We love it but it’s primarily a match making service for customers and truckers with very little support or protocol after that. So as a customer, we rate it 8 out of 10.

Their traction? Amongst the playing field of most funded logistic startup companies, it’s early days for Kargo. Their load board is active but we can’t quantify their daily posting volume. Their Android mobile app has just 1,000+ downloads and it seems they don’t yet have an Apple app. So while we wait for more good things from this startup logistics company, their traction score is a 8 out of 10.

WARESIX

Third Most Funded

Of all the logistic startup companies on this list, Waresix is the most mysterious of the most funded disruptive startups we’ve looked at in Indonesia. Launched in 2017, Waresix was founded by Andre Susanto, a young chemical engineer from attended UC Berkeley. With early logistics investment support from Indonesian VC East Ventures, they launched Indonesia’s first warehousing platform to make it easier for companies to book warehouse space.

By bringing together buyers of logistics storage space with warehouse owners with excess capacity, this startup logistics company was able to initially focus on deals with short lead times, fast setup requirements, and short term leases. Since then, their model has grown to include enterprise software that provides both warehouse management solutions (WMS) and fleet management solutions (FMS) to their enterprise clients.

Sources: News sources, Google Analytics, Crunchbase

Because the paperwork and registration process to gain access to their solutions is quite extensive, we weren’t personally able to demo their sourcing platform, WMS, or FMS solutions. However, we were able to interview one of their customers to better understand the company.

Their customer was primarily a user of their warehousing management system so we’ll focus on this. Their warehouse sourcing platform includes listings of warehousing space available with details, prices, features, and services. Some examples of features that some of the spaces includes were security, sprinklers, temperature controls, cold storage, and HAZMAT. They even had some foreign trade zone licensed spaces. Some examples of warehouse services were palletization, pallet rebuilding, carton picking, and cross docking.

Once booked, the full functionality of their WMS comes to bear including warehouse distribution, inventory, cross-docking, consolidation and deconsolidation, customer orders, and billing cycle solutions. Customers use their cloud solutions to manage reservations and monitor operations such as inventory management and shipment, as well as managing contracts and billing across different warehouses.

What we think of the service? We can’t personally testify but, among our most funded logistic startup companies, it’s clearly a unique platform that brings together the end-to-end logistics needs of businesses by combining warehousing with transportation. Their customer declined to give a firm rating because they are still quite new to the service. However, they did say they were impressed with the level of detail disclosure provided on many of the warehouse listings provided by this startup logistics company.

Their traction? There are more than 400 total warehouse listings on their platform. Businesses who use their WMS or FMS total approximately 200, mostly from industrial sectors. From this, they reportedly store and move about 200,000 metric tons per month. Not bad for a company who just closed the second part of its Series A logistics investment in January of this year. We’re excited to see more from Waresix, a very promising contender amongst our most funded logistic startup companies.

FAQ

Who has received the most venture capital logistics investment in Indonesia?

Our leader table of Indonesia’s most funded logistic startup companies is Deliveree, Kargo Technologies, Waresix, Ritase, TheLorry, and Shipper. Read this article to view the fundraising table of logistics investment and a detailed description of the top three names on our leaderboard of disruptive startups.

Which startup logistics company is the winner of Indonesia’s most disruptive startups?

Each of the disruptive startups on our list has pursued their own unique model to solving the logistics challenges in Indonesia, the world third most populous country. It’s early days and we are not declaring any winner just yet amongst Indonesia’s most funded startups, but each startup logistics company has different levels of proven traction as we discuss in this article.

July 2, 2020 by Stella Maris, Contributor

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