Over 800 million containers are moved and handled in various ports worldwide by the global marine industry. Africa accounts for over 12% of total volume, with a clearing and forwarding market worth nearly $4 billion.
Meanwhile, a slew of issues besets Africa’s freight space. Congestion at ports, opaque service provider processes, fragmented payments, and inadequate visibility and documentation are just a few examples.
These were the four primary challenges Hio Sola-Usidame faced while running Logigrains, a logistics and commodities trading company he created in 2016. Three years later, he founded OnePort 365 to address these issues in Africa’s freight management area. In other news, the three-year-old startup has disclosed that it has raised $5 million in seed capital.
Narrating his experience working in the freight forwarding space, Founder and CEO Sola-Usidame said generating a quote for a shipment takes about 10 to 14 days. Most of the processes involved in the supply chain are manual, so it takes time for quotes to be generated. According to the founder.
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“Typically, these guys have to deal with as much as 10 different middlemen. The way it works is this, there are probably about six different channels involved — you have a trucking phase, you have a customs brokerage, you have a terminal, you have a shipment, you have a warehouse, and then you have marine insurance,” he said. “As of today, I can tell you 80% of transactions are very much offline.”
If this hurdle is overcome, the next one to overcome is visibility, where Sola-Usidame claims that three out of every ten trucks that leave Nigeria’s ports go missing in transit because only around 20% of them have a tracking system.
“What you’re seeing is a situation whereby cargo worth $100,000 is being hauled by a truck driver earning $400, and as a result, there’s a lot of theft that goes on because there’s no visibility,” he said giving more description. “If you can track your UPS parcel worth less than $100, why can’t the guy loading $100,000 worth of cargo in a container track where this container is in Africa?”
Shippers employ a variety of payment options across different channels when it comes to payments. In addition, whereas the rest of the shipping and freight industry in the world has gone to the electronic bill of ladings, Africa still uses pen and paper for documentation.
Outshining Competition and Expanding Across Continent
Talking about the funding, the company revealed it plans to use the funds to increase its team and expand to “three major hubs” across the continent before Q4 2022. Other deployments of capital will go into ramping up its tech and providing trade finance to the shippers.
OnePort 365 claims that its platform can handle air, ocean, and inland haulage (trucking, barge, and rail), as well as pay-as-you-go warehousing, marine insurance, and customs brokerage. The new funds will explore how the company can increase efficiency and reduce cross-border trading costs across the continent.
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More money also means attempting to outbid the competition, as the market for cross-border logistics services is expected to reach $32 billion in sales by 2025. For the market to realize its full potential, multiple companies are required, and there are a few well-known ones: Ghana’s Jetstream and Nigeria’s SEND and MVX.
Sola-Usidame asserts that his team, including former Maersk and DHL bigwigs, has direct experience running traditional freight forwarding companies, giving them an edge over the competition.
“For us, we had experience running this in the traditional space before OnePort 365, and it’s a massive edge that gives us a lot of experience and having a good understanding of the space, and that’s what’s led us to significant growth in that period, he said.
Mobility 54, Toyota Tsusho’s VC arm, and CFAO Group lead the seed round. SBI Investment, Flexport, ODX, a Singaporean syndicate fund, and several angel investors are among the participants. After participating in the previous round of OnePort 365, Samurai Incubate decided to continue.
Takeshi Watanabe, CEO of Mobility 54 Investment SAS, commended the company saying —
“There is great potential to unlock significant commercial opportunities across the continent by addressing the long-standing challenges that have made it difficult to move freights into and around the continent, and we are confident that OnePort 365 has what it takes to succeed.”
About OnePort 365
OnePort 365 connects businesses with an efficient digital freight network in Africa, helping them gain end-to-end supply chain control. Its reliable freight process enables the complexity minimization of freight shipments, helping customers save over 40% on administrative work.
OnePort 365 says its platform provides end-to-end digitization of freight management for stakeholders in this space. It is building an operating system for cross-border trade in Africa, helping traders to manage their freight forwarding processes and enabling other value-added services.
The CEO claims that his startup, present in Nigeria and Ghana, reduces booking times from 10 to 14 days to “minutes.” Traders can also connect with shipping and inland transportation vendors and oversee the whole process (from booking to payment), as well as have real-time visibility into their shipments. OnePort 365 promises to aggregate numerous payment methods provided by the Pan-African Payment and Settlement System (PAPSS) so dealers can receive quick rewards.
OnePort 365 bootstrapped throughout its first year. While the CEO didn’t share numbers on bookings and users, he disclosed that his company has increased the number of twenty-foot equivalent unit containers (TEUs) by 140% and grown its revenue by more than 420% last year. Its business customers also grew from five to 50.
