Kenyan logistics startup Sote has raised a $4 million seed extension round led by led by Social Capital, Chamath Palihapitiya’s fund, with Ray Ko, the growth partner joining Sote’s board. The round was closed by a small group of investors including Justin Saslow, Ribbit Capital; Harry Hurst, Founder/CEO at Pipe; MaC Venture Capital doubling down; and K50 ventures.
The startup has now raised $8.4 million after securing $3 million in 2020 to support its Nairobi and San Francisco operations.
Sote plans to use the funds to merge its end-to-end logistics freight forwarding service to a full-service Working Capital loan solution for Africa’s end-to-end supply chain.
To achieve this, Sote has onboarded industry leaders. Samora Kariuki joins Sote as Director of Fintech. He is the author of one of Africa’s most renowned Fintech newsletters – Frontier. Formerly, Samora held the position of Deputy MD at Finbank, and was previously stationed at Dillux.
John Bish joins Sote as CFO and M&A lead. Formerly, John practiced finance as a CFO of Williams Lea Group and more recently CFO at MallForAfrica. He was also formerly Finance Director at DHL and Wincanton Logistics, having overseen some M&A activities there.
“Sote has always been about the people. A group of passionate individuals driven to build the future of Africa. We’re excited about bringing Samora and John under one roof with our Logistics and Engineering teams to create uniquely compelling solutions for our customers and the value chain beyond them”, said Felix Orwa, the Kenyan-born Founder and CEO of Sote.
“If the supply chain is composed of the flow of product, the flow of information, and the flow of cash, then Sote already controls the first two. With the launch of our Fintech solution, we will have control and a positive influence on all three. This creates a powerful flywheel effect with our customers as they find more holistic and convenient bundled services between logistics and capital solutions”
The startup grew its customer base 370%, and revenue growth by 200% in 2021, with 50 customers as of Dec 2021. Having recently secured their Authorized Economic Operator (AEO) certification, Sote aims to target larger customers in 2022 and exceed growth targets.
Currently, Sote, which was founded in 2018 and charges around $1,500 per container handled, provides a real-time dashboard that allows manufacturers, retailers, and distributors visibility about shipment status, saving time and money.