Indonesia-based freight logistics marketplace Kargo Technologies has raised $31 million in a Series A funding round led by Silicon Valley-based Tenaya Capital, the startup said in a statement.
The round was joined by a host of other investors including Sequoia India and Southeast Asia, Intudo Ventures, Coca-Cola Amatil, Agaeti Convergence Ventures, ATM Capital, Alter Global, and Mirae Asset Venture Investment.
As part of the round, Kargo says it also secured debt financing from some of the largest regional banks and financial institutions.
The closing of the Series A round, which makes Kargo the most funded startup in Indonesia’s trucking space, comes just days after the company received a strategic investment from Amatil X, the venture capital arm of Coca-Cola Amatil.
Other prominent players in the market include VC-backed local peers such as Golden Gate-backed Ritase, Genesia Ventures-backed Logisly and EV Growth-backed Waresix. All of them are looking to tap the opportunity in the archipelago where logistics costs are as high as 24 per cent of the country’s GDP.
Kargo Technologies can be said to be a revamp of an older web-based e-trucking company called Kargo.id, which was acquired by Tiger Fang, a former general manager for Uber in western China before taking charge of its Indonesia operations.
Following the buyout, Fang and former Kargo.co.id founder Yodi Aditya teamed up to build the new venture but decided to keep the name to retain the older startup’s quarter of a million monthly website visitors.
Kargo, which describes itself as ‘Uber for logistics,’ works by using technology to connect Indonesian shippers with carriers, thereby cutting out middlemen to provide transparency and improve the quality of service for end-users. The company claims to have already amassed more than 6,000 active shippers and a network of more than 50,000 trucks across the nation.
Kargo raised $7.6 million in a seed round last year led by Sequoia India and Southeast Asia in one of the largest recorded seed-stage deals in the region at the time. Other backers who had joined the round were Uber co-founder Travis Kalanick’s 10100 Fund, China’s Zhenfund, Indonesia-focused Intudo Ventures, ATM Capital, Innoven Capital, and Agaeti Ventures, as well as Northstar co-founder Patrick Walujo and Cardig International CEO Diono Nurjadin.
With the announcement of the new funding, Kargo says it is seeding a Logistics Relief Fund by asking all employees to contribute a total of $1 million from their salaries to aid transporters and ensure no disruptions to essential supplies in Indonesia.
The company says it is taking extra precautions to keep drivers safe. This includes ensuring that all pit stops on its routes are well-stocked and properly disinfected. Kargo has also implemented an electronic proof of delivery mechanism on its platform to limit physical contact between users. The feature reduces the need to exchange paperwork in-person and thus may help curb the risk of COVID-19 infection.
“We’re grateful for our wonderful investors who continue to support us, even in a time of financial uncertainty. Kargo pledges to be the most reliable logistics partner to ensure no disruptions to the supply chain of essential items in Indonesia,” said Kargo CEO Tiger Fang.
Kargo says it is cooperating with numerous charitable organizations, such as Kita Bisa and PT Akar Indah Pratama, as their official logistics partner on delivery of meals and essential medical supplies to healthcare workers and patients at multiple Jakarta hospitals (RSPAD Gatot Subroto and RSPI Sulianti Saroso).
While the COVID-19 pandemic has served a big blow to the logistics industry, it has not stopped some investors from betting on logistic players in Indonesia.
Earlier this month, local VC firm Prasetia Dwidharma and Astra Ventura, the venture capital arm of conglomerate Astra Internasional, announced an undisclosed amount of seed funding for logistics tech company Webtrace.