Back in August, the African logistics platform; Kobo360 raised a total of $30 million. The startup received $20 million from Goldman Sachs and an additional $10 million in working capital financing from a consortium of Nigerian commercial banks.
What somewhat appears to be like a reply to Kobo360, another African logistics business, Lori Systems which connects cargo owners with truck fleets, has secured nearly $30 million in a Series A round of financing led by Chinese investors Hillhouse Capital Group and Crystal Stream Capital (also known as Qingliu Capital).
Apoletto Asia, the investment vehicle of DST Global’s Russian billionaire founder Yuri Milner, seed stage-focused venture capital firm Timon Capital, investment firm Raba VC, innovative co-investment vehicle Endeavors Catalyst and others participated in the new round.
Lori Systems which was was launched in May 2017 in Kenya operates as an online platform that leverages on-the-ground operation teams and technologies to connect cargo owners with truck fleets, helping them increase the utilization of trucking assets and realize on-time delivery to lower costs of goods in Africa.
The company now offers services in East African countries including Kenya, Uganda, Rwanda, Ethiopia, South Sudan, and the Democratic Republic of the Congo. It also has a presence in West Africa’s Ghana and Nigeria, where it officially forayed into in late September 2019.
Lori Systems will use the proceeds to further improve technologies, products, and business operations, as well as finance the construction of its executive team.
“As one of the first Chinese venture capital funds to venture into the African market, Crystal Stream Capital has conducted field visits and investigations to conclude that it is the best time to make investments in the region, due to Africa’s rapid economic growth, demographic dividend, and booming mobile internet,” said Wang Mengqiu, founding partner of Crystal Stream Capital.
In August 2019, the Chinese investment company led a seed round worth millions of U.S. dollars in GONA, a Chinese startup that offers cashless bus services and payment solutions with a focus on the Nigerian market.
The investments received by both African logistic startups rev up competion.
For now, their focus may probably be to consolidate the domination of their home markets (Lori Systems recently expanded to Nigeria while Kobo360 also recently touched down in Kenya as well) and then become the go-to logistics company in Africa.
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