The African tech ecosystem is growing by solving different market frictions. Leading the pack is fintech, and then there is edtech, and there is logistics that gradually attracts millions of dollars in investments by using technology to provide solutions to logistics bottlenecks.
Naqla, an Egyptian logistics platform, announced that it has raised $10.5 million in a Series A funding round led by investors El Sewedy Capital Holding (SCH), Hassan Allam Holding (HAH), and the Sallam Family.
The startup said the new funding is to invest further in technology and digitization.
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Founded in 2017 by Sherif Taher and Samer Sallam, Naqla provides a trucking technology platform and marketplace that connects truck owners with cargo companies. It is currently working with more than 400 shippers and 10,500 drivers across Egypt, and now active in 35+ active zones. Over the years, Naqla has overseen the movement and delivery of over 4.6 million tonnes of cargo.
Naqla’s business model addresses the historically underserved road freight sector in Egypt, which has grown in importance since the start of Covid-related supply-side constraints.
Businesses are continuously looking for further efficiencies in inland transport from Egypt’s major entry and exit ports to maintain the flow of goods within their supply chains. The rapid growth of Egypt’s construction and consumer goods industry has meant demand for trucking continues to rise, with employees in the sector now making up 2% of the labour force, or 3-4% of GDP – $13bn in Egypt and $45bn across the MENA region. Many of the 1.5 million trucks in Egypt are owned by individual drivers, whom Naqla aims to onboard onto its Carrier ecosystem, consisting of road assistance, finance, insurance, health care and maintenance.
Naqla’s core mission is to modernize and expand Egypt’s supply chain through technology by automating orders between shippers and drivers through its two main apps.
Sherif Taher, Co-Founder and CEO of Naqla, said it has become critical now to use technology to solve Egypt’s logistics friction.
“We are now perfectly positioned to grow our digital logistics offering and market presence, bringing a much-needed technology infrastructure to the badly served Egyptian logistics and trucking industry, at a critical time in the country’s economic growth. We thank our investors for their part on the Naqla journey – this investment will enable rapid acceleration of our business and our planned vertical expansion into our new segments,” he said.
The funding has added to the growing number of investments going to logistics companies across Africa. In the first quarter of this year, Senegal-based logistics and delivery company, PAPS raised a $4.5 million; Sote, a Kenyan logistics startup, raised a $4 million seed extension round in January while Kenya-based Trucking Startup Amitruck raised $4m seed funding in February 2022.
Speaking on the investment, Kadous, Board Member at El Sewedy Capital, said: “We’re thrilled to join Naqla on their journey towards a destination of completely changing the infrastructure of logistics in the region. We have tremendous expertise in the infrastructure space, and this investment will increase the synergies between our different portfolio companies. We love the leadership team at Naqla and are not just betting on the market size, but on their grit and vision.”