You can always find a driver to do a delivery in Kenya but you don't know when the parcel has arrived and whether the driver is honest. You need contacts to make it work. Sendy wants to take the sweat and worry out of the process. Russell Southwood spoke to Sendy's Chief Operating Officer Malaika Judd about its growth.
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The idea for Kenyan online delivery company came out of two experiences. The three original co-founders used to work at MTL Systems, which did parcel tracking for bus companies:"You actually make more money from parcels than people. They did a simple thing which was to add an SMS alert when the parcel arrives saying 'Your parcel is now here.'
The next leap was to offer to deliver it directly to them at this point:"People were eager to pay for the last mile because it takes a lot of time to go and collect a parcel. We sold MTL Systems to the bus company but remembered this opportunity".
The second experience was a negative one. One of the co-founders (Meshack Alloys, CEO) was helping his mother build a house in her village. He asked a driver to go and pick up a bag of cement. The driver picked up the cement but never delivered it. There was no incentive for the driver not to steal. He begin to think about how you could create a pool of honest and reliable drivers.
"Initially we vetted a couple of motorcycle drivers. Then we put on a GPS tracker and you could click on a driver and get a phone number. That was Sendy 1.0".
But after that it got more ambitious:"The vision for Sendy was to be the preferred delivery partner for Africa. It was all about 'I want to move something somewhere'. We could operate across different forms of transport. Trucks to move things across country and motorcycles more locally".
From this universe-conquering statement, it's made a start by moving anything anywhere in Nairobi:"There are thousands of drivers vetted and approved on the platform. As the volume increases, we retain increasing numbers of drivers".
It works using an app on your phone. Payment is made through a pre-registered credit card, or using the popular M-Pesa mobile money transfer platform.
80% of work comes from business clients, including e-commerce, FMCG and other corporate clients. The rest are individuals but core business is B2B. The bulk of its transactions done with motorcycles where the amount paid can be as low as US$3. But the bulk of revenues is through trucks where the amount paid can be as high as US$1,000.
So what's the volume of deliveries? Judd is shy about giving numbers:"We're a small player getting a lot of momentum and we're aggressively growing. We've secured a lot of new clients. We're doing Safaricom's e-commerce platform Masoko. It's trying to go up against Jumia. We've grown 15% month on month".
As with most of these kinds of platforms (usually accompanied with the phrase 'We're the Uber of... ') they charge drivers a service fee and a commission for facilitating the sale and to pay for the tech platform and collerct payments.
So who is Sendy coompeting with?:"Large carrier companies like G4S and Fargo that are used by big banks and mobile providers. Smaller businesses which have 1-2 in-house drivers. And some have a rolodex of Boda Boda drivers. We've formalized the informal. We tell the small businesses, use this platform. You can trust a Sendy driver. From a technology standpoint companies like Little, Uber and Mondo might be a threat if they tried to do deliveries".
Sendy has raised US$3 million (US$2 million in its last round) from a range of local and international investors. The locals have included DOB Equity, Kernel Fund, Grey Elephant Ventures and Savannah Fund (where Judd was previously a Principal) and it was one the first company to be invested in by Safaricom's Spark Fund.
Its first expansion goal is full penetration of Kenya and then it will start looking at expanding across East Africa:"Things need to be next to each other unlike Uber." It will be interesting to see how far Sendy gets in meeting these goals in 2018.