Amitruck, a tech solution making logistics sustainable in Africa
Invest from 50€ with a 5% interest rate over 12 months and finance the development of a tech solution helping the African logistic to become sustainable
THE CAMPAIGN IN A NUTSHELL
📌 First objective : 100,000€ with a success threshold at 75 000€
📈Second objective : 140 000€ , if the campaign's dynamic allows it.
💶 Reimbursement rate: 5%
➡️ Repayment period : 12 months (4 quarters)
LATEST NEWS FROM THE CAMPAIGN
[NEWS 10/02] 📣 New objective of 140,000€ targeted for the campaign following its great dynamic. Let's reach this new objective !
[NEWS 16/02] 📣 Amitruck has raised an undisclosed pre-seed funding round to expand its growing client base in East Africa. This funding round has been completed with the participation of Dynamo Ventures, Plug & Play Ventures and several business angels.
Press release ➡ https://ventureburn.com/2021/0...
Press release ➡ https://disrupt-africa.com/202...
Kenya is one of the largest countries on the African continent with an economic growth that reached 5.7% in 2019 (placing Kenya as one of the fastest growing economies in Sub-Saharan Africa) and still expected to reach 1.5% in 2020 despite the COVID crisis. It has the potential to be one of Africa's success stories thanks to its growing population, dynamic private sector and central role in East Africa.
The transport of goods is one of the key sectors for the further economic, social and ecological development of the country. It is a market that represents 2 billion $ in Kenya and is expected to grow at a CAGR of 11.7% by 2023!
Despite this, the logistics seem to multiply gaps...
Kenya’s (and Africa’s) logistics sector is riddled with expensive middlemen: there can be up to 3 brokers between the vehicle and the cargo owner, and they consume up to 60% of the delivery fee.. The costs, but also the time of each transaction without forgetting the Co2 emissions are thus quickly multiplied. With all these intermediaries, a loss of trust between stakeholders is observed, making the delivery system inefficient. Transporters and truck drivers are then directly impacted by this fragmented system and see theirs wages drop due to the precariousness of informal transport.
The entire population in Kenya is also negatively impacted by this inefficient market. Indeed, for most fast-moving consumer goods in Kenya, up to 70% of the final cost of the product corresponds to transport and logistics. As a result, some essential consumer goods are too expensive for even the modest populations.
Logistical transport is therefore a key issue for the accessibility to essential goods.
Mark Mwangi studied mathematics at the City University of London. To pay for his studies, Mark worked as a night-shift truck driver. After a successful career as a manager at Pictet Asset Management, an equity fund, he left the British banking world to invest in his country of origin: Kenya.
Aware of the stakes that the African continent faces, Mark quickly found himself confronted with the problems and inefficiencies of logistics in his country. Brokers and grey market regulate every trade, making even the smallest logistical transaction extremely complex.
He therefore wanted to implement a solution that would benefit all parties and eliminate costly middlemen. As he had the chance to sit on the board of portfolio companies and was involved in the daily running of businesses in Ecuador, Canada and China, Mark had a precise idea of what would work.
The "Amitruck" idea was born at the beginning of 2019.
What is Amitruck?
A digital platform that connects shippers such as Twiga Foods, DHL, Skygarden, Jumia and others with independent transporters or fleets of transports.
Amitruck application's interface
For each request, approved transporters propose their offers, thus guaranteeing a competitive price for each delivery. Thank to this method, transport costs are reduced by up to 40%, which directly influences the price of the products. Each journey is therefore optimized to the maximum and empty trips are thus considerably reduced.
The company currently collaborates with two types of transporters:
- - Independent transporters: basically truck drivers who also own their trucks and who mostly work within the informal sector
- - Professional fleets of transporters, owing one or several vehicles
How does it work ?
The Amitruck’s app enables each client to facilitate his delivery process as much as possible. By simplifying this process, the company assures a high transformation rates of theirs prospects and the satisfaction of their current clients.
The technological solution also enables customers to track the journeys and thus guarantee the security of the shipping.
- 1) The client asks for a delivery on the app and present the products that need to shipped.
- 2) The most adapted transporter makes a commercial proposition via the application.
- 3) The desired option is selected by the client.
- 4) Both the client and the delivery man get in touch and define a pick-up date
- 5) Once the delivery is done and validated by the client, the transporter gets directly paid on the application.
To ease the connection between the client and the transporter, the application enables to indicate:
- - The delivery dates
- - Where to pick-up the delivery
- - Where to drop-off the delivery
- - The name of the company or the recipient
- - The type and the size of vehicle
- - Specific information about the delivery
Amitruck finances its operations by taking a 10% commission on the amount of each delivery.
The Amitruck platform improves drivers work by enabling them to access more clients, plan their days ahead, reduce idle time and empty runs. It ensures transparency, accurate trip information and fair prompt payment.
Since inception, Amitruck was able to onboard more than 1,000 truck drivers on its platform (with growing numbers every month) and has unlocked more than $400k additional income for its members. Amitruck’s research shows that active drivers are able to generate supplementary $400 per month and therefore are able to better support their households, which in Kenya averages around 4 members.
John Njogu Wacira is a transporter for Amitruck since March 2019. He is now working for clients he could never have worked with before. The platform allows him to gradually develop his activity, and to gain more autonomy in his work.
Dennis Wanderi is a 5Ton truck driver on Amitruck platform since October 2019. Working with Amitruck has allowed him to access more jobs and successfully pay back all his previously accumulated debt.
In addition, driven by the belief that sustainable economic growth will require societies to create the conditions that allow people to have quality jobs (SDG 8: Decent Work and Economic Growth), Amitruck is looking to change the employment terms of truck drivers in Kenya and beyond.
Traditionally truck drivers are part of an informal industry, which lacks quality employment standards such as: insurance, income transparency, safety, and fair payment terms. Amitruck however, allows for truck drivers to set their own prices, get accurate information on client, cargo, and distance, and are insured through Amitruck’s partner insurer. Beyond this, Amitruck pays its driver as soon as the deliveries are completed, this is over than 2 times faster than the traditional middlemen.
This lack of security & transparency greatly increases the costs of transporting goods, thus today in Africa up to 70% of the final cost of goods is transport.
Tackling directly this problem, Amitruck’s platform offers competitive prices as it connects clients directly with the transporters (cutting out expensive middlemen) and clients can set their price or allow transporters to bid on their delivery. Internal research has shown that Amitruck’s customer on average save around 30%, sometimes even up to 40% by using Amitruck’ solution.
In turn, this enables Amitruck’s customers to reduce the prices of their goods and services around Kenya, and therefore has a positive impact for the end-consumers. For a variety of clients, Amitruck currently transports among others, fruits, vegetables, sanitation equipment, furniture, dairy products.
Amitruck acts on two important levers that allow them to considerably reduce the negative environmental impact of logistics in Kenya.
- 1. By offering this technological solution, Amitruck allows the optimization of existing vehicle fleets. This is particularly the case for large carriers (DHL for example) who, rather than buying new vehicles, used 25 or 30% of the time, can afford to optimize their deliveries via the fleets already existing in the territory.
- 2. Amitruck's solution brings a technological answer to the optimization of the logistic flows of the vehicles circulating on the Kenyan roads. Thanks to this solution, the transporters have the possibility to reach a maximum loading rate in their vehicle.
Compared to the French situation, this solution is similar to carpooling applications that optimize the available seats in private vehicles on the road.
This load optimization allows Amitruck to reduce the carbon impact of the logistic sector in the country without reducing the flow of goods.
This commitment by Amitruck on Economical, Social and Environmental impact convinced GreenTec Capital to invest into and support Amitruck since April 2020 to maximize the social and environmental impact of the solution in Kenya and more broadly in Africa.
The next step is to be able to collaborate with fully electrical fleets or bio-gaz powered vehicles. This step will take place in a few years as the infrastructures need to be first put in place throughout the entire Kenyan territory.
The application was launched in March 2019.. The first year was marked by a rapid market entry thanks to multiples collaborations with independent transporters. After theirs first months of existence, Amitruck’s solution quickly convinced major Kenyan clients such as Twiga Foods or Skygarden.
As of November, Amitruck has successfully completed over 6,500 trips for over 30 different companies, the company accounts more than 260 fleets of transporters and not less than 773 independents transporters.
2020 is an important year for the company, characterized by an incredible growth. Amitruck accounts more than 2500 deliveries over the last three months. In comparison with last year’s figures, 2019 accounted around 1000 deliveries.
This dynamic shows the great interest that the Kenyan economy has for the Amitruck’s solution.
One of their clients decided to share their customer experience on this campaign:
Sanergy is company created in 2011. They are offering a sustainable sanitation cycle by selling pay- per-use toilets to local entrepreneurs and collecting and converting waste into fertilizer for small holder farmers.
Amitruck has become Sanergy’s preferred logistics partner by delivering toilets to poor communities and fertilizers to small holder farmers. Since November 2019, Amitruck has performed hundreds of trips for Sanergy improving on the cost and efficiency of its deliveries.
“Working with Amitruck, we were able to ease our logistical hurdles such as driver reliability, communication transparency and delivery efficiency. The on-demand feature of the technology allowed us to source drivers in less than 48 hours and at the same time reduce our logistics costs by close to 40%, compared to what we have normally spent. Moreover, it is very easy to communicate with drivers we never met. The user experience is instant and seamless. When deficiencies arise, Amitruck exerts effective customer response greatly improving on our over-all customer experience.”
Priscilla Salano, Procurement Manager, Sanergy
Use of the funds
Amitruck is facing an increasing demand these last few months. The company has multiplied the integration of larger accounts, such as Jumia, Kenya’s (and Africa’s) largest eCommerce player.
These major accounts help developing Amitruck. But they also put pressure on Amitruck’s cash flow. Indeed, those contracts for larger companies are usually paid after a 45, 60 or even 90 days period. Meanwhile, Amitruck pays fully their transporters and drivers once the delivery is completed. This creates a increasing cash flow gap into the company’s finance.
To solve this issue, Mark Mwangi and his professional entourage filled in the gaps themselves during the initial months.
The banking solution has also been considered. However, the interest rates are extremely high in Kenya when it comes to start-up financing.
Solylend has thus appeared as a greater solution in order to solve this short-term problem. It is for this reason that the 12 months reimbursement option has been selected by Amitruck.
Furthermore, this financing comes with a capital fundraising campaign along with multiples investors, such as Greentec Capital. The Solylend’s funds will help starting 2021 in the best way. Recruitments are planned in the upcoming month to complete the digital and marketing teams.
The complete Amitruck's team