Neil Munshi, author of the original title: Tech start-ups drive change for Nigerian truckers Summary of points: Highway is king: In the African continent where railway freight is still lacking, trade is highly dependent on road logistics.Kobo360 escorts road freight by promoting cashless freight, opening the world’s hardest cargo port, and providing diversified financial services.Depending on local conditions: $30 million in investment will be used to vertically address industry pain points and horizontally expand the business landscape.The self-employed driver, Friday Ighodaro, had experienced three to four robberies every month: on the dim highway in the suburbs of Nigeria, a group of heavily armed robbers suddenly jumped out of the truck.“It is very dangerous to carry cash in Nigeria,” he said.A year ago, Ighodaro signed a contract with logistics startup Kobo360 to deliver grain to customers across the country, including Honeywell.”Now, if they stop on the road and find that there is a Honeywell logo on the car, they know that you don’t have the cash you need to take with you on the road.”After signing with Kobo360, Ighodaro no longer has to go to the crowded card garage in Lagos to compete for business.The logistics startup Kobo360 has just been established for 20 months.In early August of this year, the company announced that it had completed a round of financing of 30 million US dollars, including debt and equity, led by Goldman Sachs.Kobo360 uses a “Uber-style logistics” model that connects drivers, fleet operators and companies that need to ship goods to various parts of Africa (goods are usually shipped to countries and regions with dense populations in Africa, as well as Togo, Ghana, Kenya, etc.)Eliminate cash transactions, streamline contract documents, and standardize contractual relationships with its comprehensive mobile app.Traditional truck companies typically prepay 30% of their cash to drivers for food and fuel along the way; Kobo will transfer 70% of the advance payment directly to the driver’s bank account before departure.In this way, the driver can use the mobile payment program to purchase food along the way, and can also use the Kobo software online service at the gas station to refuel at the discount price.“Tincan Port (the port of Lagos) is the most difficult port in the world to transport goods – trucks are usually kept here for several days, and soldiers will extort money from drivers waiting in line,” Goni Gombe said.”But now, we can get in and out without any problems.” There are 60 trucks in his fleet, and the business has tripled since signing with Kobo.The driver no longer has to be blocked in the long queue to the main port of Lagos. Kobo will use the flat-bottomed cargo ship to deliver the cargo truck directly to the customers in the port.Kobo said that it has already signed more than 10,000 drivers.Thanks to the Africa Continental Free Trade Area agreement, which was signed in July, Kobo’s operations are expected to become smoother in the future.The agreement aims to promote backward trade development within the African continent and is a milestone.To get rich, first do a good job in road logistics. For those companies that want to show their strengths in Africa’s largest economy and even the whole continent, logistics is one of the biggest obstacles at the moment.Poor infrastructure, years of security problems, inefficiency, corruption, poor quality trucks and high fees all plague local logistics.Due to the severely inefficient logistics system, most African countries are ranked bottom in the annual report on the logistics performance index issued by the World Bank.Obiora Madu, head of the African Supply Chain Center in Nigeria, said that sometimes shipping containers from China to Lagos is cheaper than shipping from the port of Lagos to the other side of the city.“If you want to transport coffee from Kenya, you have to ship it to Europe before you can send it to Nigeria (because there are no interconnected roads between the two countries),” he said.”And this also ruined the cost advantage that was originally available.”Logistics companies like Kobo360, such as its main competitor, Kenya’s Lori, are reforming the local logistics system – the success of the recently signed Free Trade Area Agreement on the African continent depends largely on this. The agreement aims to promoteThe economic growth of the African continent. At present, the gross domestic product of the African continent totals more than 3 trillion US dollars, and the population is growing rapidly and the structure is young. “Logistics is the core of this (agreement) – given that we have almost no railways, roadsLogistics is the only way to transport goods,” said Obi Ozor, founder of Kobo360. Since the colonists built railways in Africa, the construction of the railway system has been limited and development has been stagnant. “I don’t think there are any countries in the next 25 years.Complete the entire line of the railway.We are shipping from Nigeria to Ghana and it takes 16 days to complete the 460 km journey.”According to local conditions, aiming at the African market, the pain point is in the West. The odd jobs economy is not welcomed by workers and commentators. The odd jobs are both unstable and demanding. But in Nigeria, where nearly one quarter of the unemployed are working, it is a freelance job for freelancers.The platform has brought people a glimmer of life. “If they can bring me more business, they are my second god,” said Kobo’s signing driver, James Okoruwa. “And this is what we pray.Kobo will provide truck finance plans, diesel discounts, medical and tuition grants, insurance and advance payments for “moonlight” truck drivers who have long been used to waiting for two or three weeks to get paid. At the same time, the company is also a joint venture for daily necessities.Lihua, food processing company Dangote Sugar and steel manufacturer African Industries provide real-time tracking of transportation status. The pitted highway often traps trucks. If there is a truck failure, Kobo will send a maintenance team to the fault location.To ensure that the goods are protected from looting and to transfer the goods to new trucks. Kobo plans to use the $20 million equity financing provided by investors such as Goldman Sachs, Y Combinator and IFC to further develop its business in Nigeria and enter another 10The country has established a logistics platform that uses blockchain technology to bring all services together. In addition, the company plans to use $10 million in debt financing from Nigerian banks to provide financial services to drivers and fleet operators.Ozor is 30 years old, hePrior to founding Kobo in 2017, he worked briefly at JPMorgan and Uber in Nigeria as an investment banker and operations manager. He announced that he would visit China in late August and began designing “Trucks for Africa” to cut Nigeria.Half the cost of a truck driver. “In Africa, no truck driver will use air conditioning, so why do we have to add an additional $11,000 for this?We have digital dashboards, but we don’t need that, save $7,000 and spend $4,000 to install new shock absorbers – this is what we need in Africa.”Edit | Guo Chen @36氪海图 | Oriental IC.
Can the Kobo360 revolutionize African freight transport on the outbound logistics track?