Rider takes an agile approach to e-commerce logistics in Pakistan – TechCrunch
Rider is on a mission to provide online shoppers in Pakistan with next day deliveries “like Amazon”. The Karachi-based company announced that it has raised $3.1 million in new funding from Y Combinatior, as well as new investors i2i, Flexport, Soma Capital and Rebel Fund. Returning investors included GFC, Fatima Gobi and TPL E-ventures, as well as Dropbox co-founder Arash Ferdowsi. This brings RIder’s total raised to $5.4 million since September 2021.
Founded in 2019 by former UPS Pakistan executive Salman Allana, Rider is building a network of sorting centers, delivery centers and a digitized fleet. The platform allows sellers to offer next day delivery with route optimization, live tracking and scheduling for buyers. The company says that since its pre-seed investment round in September 2021, monthly revenue has increased by 110% and it has doubled its customer base to 650 online sellers. So far, Rider has delivered 3 million packages to 60 cities in Pakistan. It currently runs a network of 16 hubs that cover 60 cities across Pakistan, which Allana says accounts for about 60% of e-commerce demand in the country.
Allana told TechCrunch that growing up in Karachi and spending his early career in sub-Saharan Africa meant he was used to poor supply chains and logistics services. “If you ordered something online, you accepted the huge risk that it never appeared,” he said. When he moved to London to study for his MBA, he became “obsessed” with Amazon delivery. “How could an order I placed at midnight be on my doorstep the next morning? I thought there was a clear and significant opportunity to bring this quality of service to online sellers in Pakistan and to eradicate “parcel anxiety” for all online shoppers in Pakistan, including myself.
After completing her MBA, Allana started working for UPS Pakistan as a Strategy and Business Development Manager. He has seen first-hand the challenges faced by incumbent logistics operators, including lost orders, buyers reluctant to re-order online and, for online sellers, headaches such as payment manual on delivery, reconciliation and slow reimbursement, which have created working capital problems, especially for Pakistan’s one million SMEs that rely on Instagram and Facebook to reach shoppers.
“I learned that traditional delivery payers weren’t set up or equipped to meet the online retail trend, and a change from within would be slow and costly,” Allana said. “The COVID pandemic has brought about a huge and irreversible shift towards online shopping across Pakistan. Only a purpose-built, dynamic and growth-oriented startup could seize this opportunity in time.
Logistics is a notoriously energy-intensive sector. Allana said the delivery center network Rider is building isn’t what you usually imagine. Instead, they include mobile warehouses (or pre-sorted vans), empty spaces in the parking lot of shopping centers and gas stations. In the future, Rider would also like to have delivery centers in kiranas, or convenience stores. This means delivery centers are flexible enough to move as high-volume e-commerce areas change.
“We basically build for ‘city logistics’, so we don’t need big sorting centers and spaces,” he said. “Our network consists of many small delivery centers that are deliberately placed to cover high-volume e-commerce areas, and are ultimately flexible to move as those areas change.”
Rider’s new funding will be used on its in-house technology, including e-commerce enablement tools such as plug-ins and integrated wallets to help SMBs, which Allana says are predominantly female-owned, to develop their activities.
“Our ambition from day one – we want to be the leading end-to-end e-commerce logistics solution provider in the country,” Allana said. “But we see logistics as a series of building blocks, each of which needs to be settled, operationally and financially, before we can build the next one. Today, Rider does last-mile delivery to the We have proven that our last mile solutions work, we have proven that they work at scale and now we need to prove that they work sustainably before entering other verticals. added that Rider already had his eye on his next phase and piloted his B2B, or ground trucking, move in January.
In a prepared statement, i2i General Partner Kalsoom Lakhani said, “As the e-commerce industry in Pakistan grows, the need for a next-generation 3PL player who understands the realities of the Pakistani market and knows how to build both aggressively but also effectively will also increase. We believe this player is Rider and have so much belief in Salman and his vision.