Participants in the funding round include 4DX, Plug and Play Ventures, Wealthwell VC, and Khwarizmi VC from Saudi Arabia as well as other regional and global investors.
This investment is coming after the startup raised a $2.5million round a year ago; bringing its total funding to $9.2 million.
Since 2017, the company claims to have delivered more than 4 million packages to businesses. Completing more than 300,000 deliveries per month, which is a 3.5x increase from when it raised its previous round. About 2,200 businesses currently use its platform daily and achieve a 95% delivery success rate.
In the words of the CEO, “You can use Bosta to get anything to your doorstep. You buy in our local currency, and we buy everything, handle the shipping, customs, clearance, and bring it to your doorstep.”
Asides from small businesses, Bosta works with major e-commerce platforms like Souq (an Amazon company) and Jumia. Depending on the volume of goods transported, Bosta charges small businesses about 35-40 Egyptian pounds, while the big players are charged less, at 20-25 Egyptian pounds.
The inspiration for Bosta came during Ezzat’s time as COO in the consumer goods startup, Lynks. The first YC-backed company from Egypt, which allows people in Egypt to buy brands from the U.S., China, and the U.K.
During his time at Lynks, Ezzat describes his experience with handling the last mile delivery as a nightmare because e-commerce wasn’t very developed then and it constituted just 1% of the whole retail value.
“So I was always thinking, how come if we want the e-commerce to grow, and we don’t have any strong company when it comes to last-mile because, in the end, every transaction on an e-commerce platform is a transaction on a courier platform.” the CEO said.
The company doesn’t own its fleet of vehicles to deliver on its operations. Instead, it relies on its network of freelance riders who are paid for every order that is delivered successfully. The first and last mile is done by this fleet and the middle-mile (for inter-city couriers) by rented vans.
Speaking on the investment, Fawaz H Zu’bi, the founder of Silicon Badia said in a statement: “E-commerce has always had amazing potential in our region but was always being held back by something whether payments, logistics, market fragmentation, or customer adoption. We are excited to finally see companies like Bosta emerge to tackle some of these issues and help e-commerce realize its full promise and potential in a region that has now ‘turned on’ digitally.”
In a statement, Ezzat explained that Bosta is poised to solve the problems associated with last-mile delivery for e-commerce startups in Egypt and the Middle East.
“As a company, we are committed to helping the e-commerce sector grow by providing them with speedy delivery, quality, and exceptional service—all while making sure our prices are one of the most competitive to help them with their tight unit economics and help them grow a profitable business. At Bosta, with our customer-driven approach and finding tech-driven solutions, we make sure that we can hit the three pillars while keeping our costs as low as possible.”
With this fresh fund, the startup plans to grow its business in Egypt in the coming days by delivering more than 15million parcels and serving over 20,000 businesses. The funds will also be used to expand its operations across Africa, MENA, and the GCC, starting with Saudi Arabia later this year.
Khwarizmi Ventures, one of the investors in this latest funding round is the venture arm of Kadi Group, a company that owns and operates different logistics businesses in Saudi. It’s apparent that they will be instrumental to Bosta’s expansion to Saudi this year.