Loship, which operates an on-demand delivery platform as well as a customer-to-customer (C2C) e-commerce portal, said it has raised an undisclosed amount of funding in a Series C round led by Skype co-founder Jaan Tallinn, who participated through his investment vehicle MetaPlanet Holdings.
The firm is set to leverage the new funds to expand its one-hour delivery service to lower-tier cities in Vietnam. “A huge portion of the funding will be used to upgrade our app and increase our tech capability three times [more]. Also, we will ramp up marketing strategies to strengthen our foothold in the existing markets,” Loship CEO Trung Hoang Nguyen told KrASIA.
Loship traces its roots to Lozi, a restaurant guide and review app targeting Generation Z and millennial users. Lozi pivoted into a social C2C e-commerce platform in 2015 and expanded its intra-city delivery services by founding Loship in 2017.
Currently, Loship controls a fleet of more than 70,000 drivers and 200,000 merchants, serving 2 million customers across five big cities in Vietnam, including Hanoi, Ho Chi Minh City, Da Nang, Can Tho, and Bien Hoa. Its main source of revenue comes from commissions, delivery fees, advertisements, and supplying ingredients to merchants, according to Nguyen.
While the company did not reveal its market share, Nguyen added that Grab is currently commanding in tier 1 cities such as Ho Chi Minh City and Hanoi. Loship, however, is the “dominant” player in lower-tier cities.
As one of the fast-growing digital economies in the region, Vietnam’s e-commerce sector is expected to be worth USD 23 billion by 2025, according to the e-Conomy Southeast Asia 2019 report by Google, Temasek Holdings, and Bain.
Eyes on Laos and Cambodia
Both the e-commerce and on-demand delivery sectors are fiercely competitive, with notable names like Grab and Gojek holding leading positions. A handful of startups have sprung up to meet the burgeoning demand, including Sea Group-backed food delivery firm Now.vn and instant delivery platform HeyU.
“We will further develop our own e-wallet and partner with payment gateway providers to facilitate cashless payments and complete our ecosystem,” said Nguyen.
“Regional expansion is part of our strategic plans in the longer run, with Laos and Cambodia as must-win markets. We set our sights on conquering a total market of 400 million in population, and once we have researched enough and have our resources in place, we’ll be ready to start operations there,” He added.
After the firm bagged its first investment from Vietnam Silicon Valley in 2015, it also secured a seven-digit funding round from Golden Gate Ventures and DesignOne Japan in the same year. Loship also closed an eight-digit Series B round led by South Korea’s Smilegate Investment in October 2019.
Just four months ago, the firm completed a bridge round led by Singapore-based fund manager Vulpes Investment Management, however, no financial details on the deal were disclosed.
(Loship reached out to KrASIA to clarify that the latest capital injection from MetaPlanet is part of its ongoing Series C fundraising, which is set to close by the first half of 2021. The first paragraph has been edited to reflect this change.)