MVX, a Lagos-based digital freight, and the hauling startup has secured $1.3 million in seed funding to help merchant shippers move cargoes faster.
The startup which started as a booking service for chartered sea vessels, but pivoted into a digital freight forwarding and trade finance venture last year, raised the funding from Kepple Africa Ventures, The Continent Venture Partners, Founders Factory, Launch Africa Ventures, and Capital Oak. A few unnamed angel investors from the US, Japan, Nigeria, and South Africa also participated in the round.
The two-year-old startup plans to use this new funding to hire staff, expand its operations, and improve its technology. MVX is also talking to investors to raise more money, most likely debt, for its trade financing product.
MVX was launched by Tonye Membere-Otaji and Tobi Amusan in 2019, after securing a $100,000 pre-seed investment from Oui Capital, a pan-African VC firm. MVX is a tech-driven maritime platform that matches vessel charter requests with available offshore support vessels. It has a presence in Nigeria, South Africa, Ghana, Kenya, Tanzania, and Rwanda.
In April 2021, the company launched MVXpay, a finance and payment solution to provide trade finance for freight operators. MVX charges a commission for the services provided, including trucking, warehousing, shipping, and cargo stuffing.
The company launched a new product, MVXtransit, last year. MVXtransit is a digital freight platform that allows booking and deployment for import, export, and land haulage besides customs brokerage in Nigeria, South Africa, Kenya, Tanzania, Rwanda, and Ghana. It exports from these six African countries to the rest of the world.
Recently, the company also launched MVXpay, a finance and payment solution for freight operators. The overall business now operates under the MVX banner.
Per TechCrunch, The pan-African freight company has already recorded more than 300 shipments this year but plans to end with 1,500. Regarding revenue and traction, the CEO claims the company has surpassed its 2020 numbers.
MVX is one of a handful of Sub-Saharan logistics-tech startups to get funding this year. Another peer that raised cash recently is Jetstream, a technology-enabled supply chain venture based in Ghana.
Jetstream, located in the city of Tema, bagged $3 million in a seed round from Alitheia IDF, Golden Palm Investments, 4DX Ventures, Lightspeed Venture Partners, Asia Pacific Land, Breyer Labs, and MSA Capital.
The startup has positioned itself as a data-driven vertical broker for cross-border trade in Africa. Its platform is backed by a fulfillment network of third-party customs brokers, freight forwarders, terminal operators, and other logistics providers in each trade corridor.
In a statement, Membere-Otaji said: “We make it easy and convenient for businesses. Instead of trying to do everything themselves, which can be chaotic and cause distraction from their core businesses, we handle everything because we have all these service providers in one platform. So as shippers work with us, MVX works with like seven to 10 other service providers,”
Some merchants lack adequate capital to pay for freight or supply and they are looking to move shipments from Africa to the U.S or China, so this concept works best for them to the best of their trade. By using MVX, they can request credit. It then passes it on to its financial partners, who lend out the money to consumers if they meet the minimum requirement.
Next, MVX sends the shipment overseas and manages its delivery. Once the transaction is done, the merchant pays back, with all partners taking commissions.
Mr. Membere-Otaji added that “Our job is to empower trade in Africa, and freight is a means to that. From every step involved in that process, from providing trade and finance to warehousing to payments processing, we want to play in all that space. There aren’t a lot of companies with that trading finance element doing that like us. And also, we see a huge potential in the offline market. Right now, the reason why we have this problem is that transactions are offline. Our strategy in capturing offline markets is also key.”
Commenting on the round, Satoshi Shinada, general partner at Kepple Africa, said, “The trade sector in Africa is one that we believe is ripe for disruption. MVX is building a game-changing technology and platform to revolutionize how businesses in Africa move shipment and trade around the world.”