Kenya’s end-to-end logistics solution that enables thousands of businesses to move any type of goods, Sendy, is shutting down operations and is reportedly exploring the sale of its assets.
Announcing the sale of the startup, Sendy co-founder Meshack Alloys said,
“We are in the middle of an acquisition process. So yes, Sendy is being acquired. We will issue a formal joint statement in two weeks or so. In the meantime, we are unable to comment on further details at this time”.
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Several sources disclosed that the logistics startup ran out of funds two months ago and had been scrambling to cut costs for the past year to remain afloat. Last July, it announced a 10% cut in its workforce, which the company’s CEO noted was in response to the current realities impacting tech companies globally.
Sendy was forced to restructure on a funding drought that hit Kenyan start-ups, as developed economies raised the cost of lending. Since then, the company’s workforce has been pruned further with more cost-cutting measures. That funding drought has come as markets change even in places like the US where banks are experiencing stress due to many factors..
Moody’s Investors Service warned late Monday that it may downgrade six big banks, including U.S. Bancorp, Bank of New York Mellon, State Street and Truist Financial, and lowered its credit ratings for 10 small and midsize U.S. lenders. The move comes amid growing pressures on the finance industry following the recent collapse of Silicon Valley Bank and the ensuing crisis of confidence it triggered. As interest rates rise, banks continue to grapple with higher funding costs, potential regulatory capital weaknesses and risks linked to commercial real estate loans, Moody’s said.
Last October, the Kenyan startup laid off 54 employees and wound down its supply service. In late 2022, Sendy secured an undisclosed financial support from MOL PLUS, the venture capital division of Japanese transport firm Mitsui O.S.K Lines, Ltd.
This funding, seemingly acting as a rescue fund, aimed to stabilize Sendy, while the logistics startup strategized its future moves.
Meanwhile, in February this year, the startup terminated its on-the-ground operations in Nigeria to find the right market.
The company which started operations as a delivery service before spinning off e-commerce and retail supply platforms, shut down the latter business line to focus on sellers placing goods in its warehouses for marketing and delivery.
Sendy said it wanted to focus on fulfillment centers and transport businesses to leverage on uptake of digital commerce.
Since its inception, the startup has raised $26.5 million in disclosed funding from several investors, which include, Toyota Tsusho, Atlantica Ventures, VestedWorld, Keppel Capital, Enza Capital, AAICA Investment Pte Ltd, Sunu Capital, and Goodwill Investments.
Founded in 2014 by Meshack Alloys, Evanson Biwott, and Don Okoth, Sendy’s platform connects individuals and businesses with delivery drivers who use motorcycles, tuk-tuks, and vans to deliver packages and goods across various locations.
Sendy’s model is often compared to ride-sharing services like Uber, but instead of transporting people, the company focuses on delivering goods. The company makes use of a a mobile app, and a web platform to facilitate the process of requesting deliveries, tracking them in real-time, and handling payments.
It aimed to address challenges related to inefficient logistics and transportation in many African cities. By providing a technology-driven solution, Sendy aimed to streamline and optimize the delivery process, helping businesses and individuals move goods more effectively.