YC-backed logistics start-up scoops seed round from the popular YC Demo Day as they seek to ramp up the logistics space in Pakistan and create an Amazon-like next-day delivery service for ecommerce businesses that are expected to grow 16% CAGR, making it a $10.5B opportunity by 2025.
20th June 2022 – Karachi, Pakistan: Rider, Pakistan’s first-ever logistics start-up to be backed by YC, is building modern logistics for online sellers across the country. In doing so, the start-up has attracted the attention of investors and is today announcing a $3.1M funding with participation from YCombinator and new investors i2i Ventures, Flexport, Soma Capital and Rebel Fund. Existing investors Global Founders Capital, Fatima Gobi Ventures (FGV) and TPL E-ventures also joined the round which included notable angel Arash Ferdowsi (Dropbox Co-Founder). With this seed round, Rider has now raised a total of $5.4m since September 2021.
Founded in 2019, Rider has been building a network of sorting hubs, urban delivery centres and a digitized fleet, offering online sellers in Pakistan a next-day ‘Amazon-like’ delivery service. The Rider platform offers route optimisation for delivery agents, live tracking and scheduling for buyers, and a highly digitized warehousing function for sellers. Rider is led by Salman Allana, a former UPS Pakistan exec and the core team consists of former Alibaba, Delivery Hero and Jumo executives.
Since their pre-seed investment round in September 2021, monthly revenues have grown 110% and they have doubled the customer base to 650 online sellers. Rider has now successfully completed the delivery of over 3M parcels across 60 cities in Pakistan.
Salman Allana, founder and CEO of Rider commented: “We set up Rider because we knew the traditional courier companies in Pakistan were not set up to service the e-commerce market and were failing to capture the online buying trend. The problem is huge, circa $1bn GMV is lost annually due to failed and slow deliveries, but the opportunity is even bigger than that – Pakistan is the 5th most populous country in the world with 70% smart phone enablement yet only 3% of retail sales are currently made online. We’re really excited about the market potential and the impact Rider is already having in supporting business growth across the country.”
Rider has plans to enhance the ecommerce marketplace in Pakistan with solutions and infrastructure beyond logistics. Salman Allana added: “Retail is north of a $150B industry. Yet it is stuck in bricks and mortar. Through our platform, one mile at a time, we are enabling the industry to transform and get online and we will offer more in time to come. Moreover, we are opening the industry to more participants and changing the face of it. We are fully behind the mission to enable more than 1 million – primarily female-owned – Instagram/Facebook sellers to trade.”
“Pakistan’s payment infrastructure is chasing the growth of ecommerce and logistics capabilities. Well over 95% of all ecommerce orders are cash-on-delivery (COD) which creates operational challenges for last mile and retailers. Rider is addressing this piece of the puzzle with our payment wallet through which we can reconcile work quickly and ensure sellers are reimbursed within hours”.
On joining the investment round Kalsoom Lakhani, GP i2i Ventures said: “We are honored to be on this journey with Rider. As the e-commerce industry in Pakistan grows, so will the need for a next generation 3PL player that understands the Pakistani market realities and knows how to build both aggressively but also efficiently. We believe that this player is Rider and have so much conviction in Salman and his vision.”
Meanwhile, new investor Jared Heyman, Managing Partner, Rebel Fund commented: “Rider is Rebel Fund’s first investment in Pakistan and we’re excited to support their further growth. The company’s founding team and traction to date are impressive, and we believe the Pakistan market desperately needs a sophisticated technology-driven delivery service like Rider.”
FGV’s General Partner Ali Mukhtar commented: “There is strong momentum in the ecommerce space in Pakistan, largely driven by the shift in consumer behaviour with the increase in 3G/4G penetration across the country. With that, there is an immense growth potential for last-mile champions such as Rider who are building the required infrastructure to enable growth in the ecommerce space. We believe in the Company’s tech-first approach and we’re excited to once again support Salman and his team at Rider.”
Willem van den Bosch, Investor at SOMA Capital remarked: “We think Rider is uniquely positioned to capitalize on the expansion of eCommerce in Pakistan. Rider’s core tech-forward product offering fixes legacy pitfalls that exist in the last-mile fulfilment market today – Rider’s B2B2C offering fixes issues with delivery failures, lateness, and broken communication which have hampered the expansion of ecommerce previously. We’re extremely supportive of the Rider team’s ability to execute and expand deeper into the full logistics product stack and continuing to enable eCommerce fulfilment in Pakistan and beyond.”
Founded in Karachi in 2019, Rider is a B2B2C service that delivers e-commerce products from online stores and marketplaces to the customers’ doorstep. Operational innovation is core to the team’s mission. Rider exists to continuously reimagine, redesign and rebuild operations that work for emerging markets.
For more information please visit https://withrider.com/ or follow the company on: Twitter, LinkedIn, Facebook or Instagram.