Logistics in much of Southeast Asia is not only complicated, but also expensive. Deliverer wants to solve that problem with a platform that not only lets customers book trucks, but also uses algorithms to determine the best route based on location, truck loads and even the weather. The company announced today that it has raised a $70 million Series C led by Gobi Partners and SPIL Ventures, with the participation of recurring investor Inspire Ventures. This brings the total amount the company has raised to date to $109 million since its founding in 2015.

Due to the high logistics costs, consumers end up paying higher prices, says founder and CEO Tom Kim. “The way we see the market is that number one, the inefficiency in freight and freight forwarding has driven costs up significantly. Imagine you are in California, Los Angeles and buying a pair of Nike shoes. What part of those sales costs is spent on logistics and transport and storage? The answer is very well documented. It’s about 8%. If you buy those same Nike shoes in China, the answer is about 15%. And if you buy the same Nike shoes in Indonesia, Thailand or the Philippines, the answer will be much closer to 25%, maybe even more than 30%.”

The company says it has grown its gross transaction value by 3.2x in the past 24 months and will exceed $100 million this year. It currently has 500 employees and 100,000 drivers on its platform.

Deliveree is currently available in Indonesia, the Philippines and Thailand. It mainly focuses on large trucks that move commercial goods or large items. Kim said that, based on Google Analytics, it is more searched than other logistics companies. These include Waresix, Go Box, Kargo Tech and Logisly in Indonesia; Mober, Inteluck and TheLorry in the Philippines; and Giztik, TheLorry and Ezyhaul in Thailand.

Kim added that the logistics war is especially heated in Indonesia, where many logistics startups, such as Waresix, have received funding.

“It’s where a lot of startups and disruptive technology in the space are being built, and it’s definitely a very active market,” he told australiabusinessblog.com. “There are all these famous players, like Waresix or even Kargo Tech. The Philippines and Thailand are also interesting and great markets, but there are fewer players in the logistics space, especially cargo, trucking and freight.”

One of the problems Deliveree is solving is the inefficient use of trucks. For example, trucks deliver a load of goods, but then return to the warehouses empty. However, if it’s part of Deliveree’s system, companies can book it to ship goods on their way back. That makes better use of the money spent on fuel, time and expedition teams.

“There are a lot of empty trucks on the road in Thailand, the Philippines and Indonesia, because everyone has their own company fleets,” Kim says. “They deliver in one direction and the truck returns empty. It’s even true for long-distance deliveries, when you’re shipping goods from one warehouse to some sort of facility in another city. The same thing happens: you send the truck full in one direction and it comes back, sometimes hundreds of kilometers, empty.”

Deliveree solves these problems with a dynamic market, which Kim says currently has tens of thousands of customers and suppliers, including a combination of independent drivers and transport companies. The market’s technology, combined with volume, can identify customers in both directions during a truck’s journey, so it rarely runs empty. The market gathers the demand and determines the optimal routes so that trucks remain full. Kim said that before Deliveree came, an occupancy rate of 40% to 50% was considered above average. However, with Deliveree’s marketplace, trucks can achieve an 80% occupancy rate, thanks to Deliveree’s internally generated dataset, which has been in the works for five years.

“While it’s far from perfect, it’s getting smarter every day as we make thousands of bookings every day, and it can make more accurate predictions about the length of the booking, the day of the week, the time of day, even the weather. These are all things that have a drastic impact on maturity,” Kim said.

This also means that the warehouse has shorter queues, as Deliveree’s algorithms can predict what the loading and waiting times will be.

Most companies have their own fleet of vehicles, which means they have to hire expedition teams, administrator teams, security teams, parking lots and security guards. This is still the prominent way it’s done, Kim said, and means a lot of overhead for companies. Kim said his argument in pitching Deliveree to companies is that they can reduce their balance sheets and book trucks on an asset-light basis. That means they only pay for trucks when they need them. When the pandemic broke out, revenues fell for many businesses, and Kim said this led to more adoption of Deliveree as they sought to increase revenue. This increased the adoption of Deliveree as more companies tried to find ways to save money, turning their fixed costs into variable costs.

The delivery person makes money by charging the customer a fee and sharing it with the carriers. Deliveree’s standard ratio is 80% to the independent truck driver or transport company and a 20% commission to the company.

In a prepared statement, Gobi Partners Director Kay Mok said: “After the pandemic, we are moving into an inflationary environment plagued by supply chain issues. Deliveree has built the best technical platform for customers and this will enable them to optimize and reduce operating costs for logistics and the shipping company.”