Kobo connects the supply of trucks with the demand for transportation services by cargo owners in Africa’s most populous nation with 2.57 per cent share of the world’s population.
Nigeria has 195,875,237 people.
The investment was led by the IFC with participation from others including Silicon Valley investors WTI, YCombinator, and African institutional investors among them billionaire Manu Chandaria’s Chandaria Capital, Cardinal Stone Partners and TLcom.
The company improves access to long-haul road freight services for large and small enterprises in the rapidly growing agribusiness, fast moving consumer goods and manufacturing sectors.
Currently, Kobo has 5,000 trucks empanelled on its platform, from over 600 small fleet owners, serving some of the largest enterprises in Nigeria.
“IFC is committed to supporting the digital economy and young entrepreneurs in Nigeria and across Africa. IFC’s investment in Kobo demonstrates how disruptive technologies can enhance the development of key sectors and contribute to Nigeria’s economic diversification. This is an innovative startup that is making company operations more efficient and lowering transport costs,” said Philippe Le Houérou, CEO of IFC.
Efficient logistics is a core component to growth, transportation and mobility feeds into levels of output, employment and income within a national economy accounting for 6-25 per cent of GDP in developed countries.
Nigerian road freight accounts for 99 per cent of long-haul transportation, a sector plagued by inefficiencies including low utilization of truck assets, low visibility on truck movement, lack of pricing transparency, and insufficient supply of trucks.
Trips can take more than three times as long and cost twice the price in Nigeria compared with similar distance routes in the US.
The Kobo app solves these challenges and inefficiencies.
Obi Ozor, CEO and Founder of Kobo said, “We are excited to have our new investors to support us in redesigning transportation and logistics in Africa, and across Emerging Markets, by building a Global Logistics Operating System (G-LOS) to power new frontiers in trade and commerce.”
He adds, “Our motivation remains to aggressively reduce logistics frictions for large enterprises and SMEs, and connect new markets, and in the process unlock better wellbeing and opportunities across communities”
The transaction was announced on December 7, 2018, by Le Houérou and Ozor on the eve of the opening of the Next 100 African Startups Initiative.
The programme, launched in partnership with the Egyptian Ministry of Investment and International Cooperation and IFC, spotlights more than 100 promising African start-ups.
These startups participated in the Africa 2018 Forum being held in Sharm El-Sheikh, Egypt from December 8-10.
Kobo is among the successful startups sharing its experiences with even earlier stage startups, alongside international investors and financial institutions, government officials, and policymakers from the African continent.
It is the latest addition to IFC’s growing venture capital portfolio of e-mobility startups in frontier markets including BlackBuck (India), Full Truck Alliance (China), Loggi (Brazil), Mandae (Brazil), PickMe (Sri Lanka).
IFC supports the mobile technology sector to help promote social inclusion and business growth.
Over the past three years, IFC has invested over $1.5 billion in telecommunication, technology, and startup companies globally.
During the Africa 2018 Forum, IFC announced it was investing $1 million in Vezeeta, an Egyptian technology company that allows patients to quickly find doctors online.
The platform is available in three Middle Eastern countries and IFC’s investment is part of its broader efforts to support entrepreneurship, expand access to finance for start-ups and help create new markets.
The package will help Vezeeta—whose database includes more than 4,300 doctors and specialists—to scale up its operations in Egypt, Saudi Arabia, and Jordan while expanding into other countries in the Middle East and North Africa (MENA) region.
IFC’s support is also expected to help Vezeeta more than triple the number of patients it supports, boosting it to 1 million within the next five years.