Deal focus: Ninja Van targets logistics logjam

For two of the three founders of Ninja Van, the idea to create a last-mile logistics provider for the e-commerce industry came while working on another start-up, an online fashion business called Marcella. It was here that Lai Chang Wen, the CEO of Ninja Van, and Boxian Tan came to understand the delivery bottleneck that challenges online retailers.

"It gave them a perspective into this logistics problem that isn't clear if you aren't directly involved. They saw the opportunity was more significant than what they were working on so they started Ninja Van," says Peng T. Ong, managing director at Monk's Hill Ventures.

Monk's Hill met the three founders at the beginning of this transition in 2014. Early the following year, the VC firm led a Series A round for Ninja Van worth $2.5 million as the business expanded from Singapore to offer services in Malaysia and Indonesia. The company has now secured a $30 million Series B round led by The Abraaj Group. Monk's Hill, YJ Capital and B Capital Group also took part.

Ninja Van delivers around 15,000 packages per day and has more than 3,000 clients, not only e-commerce specialists but also traditional retailers. The service is built on a technology platform that manages multiple processes simultaneously, calculating how to fulfill each customer's deliveries in the most time-efficient and cost-efficient manner. It is not simply about hiring a driver to carry a single package from point A to point B.

"This is like one of the more interesting computer science problems, but there is not only a theoretical aspect to what you are doing - you have to translate that to the distribution center," says Ong. He adds that Monk's Hill looked at many similar start-ups and concluded that Ninja Van was the only one that really understood the problem and could also master execution.

Ninja Van has a core fleet of more than 350 drivers and riders to make the deliveries. The company has the ability to crowd-source drivers through its network, but when entering a new market the typical strategy is to work in partnership with an existing transportation provider to ensure stable supply. This will remain the case as it rolls out in Vietnam, Thailand and the Philippines.

"The strategy, moving forward, is to build an integrated logistics ecosystem in each market through hubs and sortation centers, utilizing a model of core fleets and ‘crowd-sourced' reserved fleets to manage peak seasons, business efficiency and service quality, all underpinned by a strong technology backbone," says Omar Lodhi, partner and head of Asia at Abraaj.

Lodhi believes Ninja Van is well positioned to capitalize on a doubling in e-commerce activity in Southeast Asia over the next four years. At the same time, due consideration must be given to the realities of different markets. "You are going to see a significant amount of energy spent understanding how to work on each of those geographies, with the government as well as the competitors and partners," says Ong.

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• Topics
• Southeast Asia
• Technology
• Early-stage
• The Abraaj Group
• Monk's Hill Ventures
• TMT
• Logistics