Leta, a Nairobi-based logistics startup, leverages AI technology to optimize delivery routes and improve operational efficiency in Africa. The company has raised $5 million in seed funding, with backing from Google and Speedinvest, to enhance logistics services across the continent. Currently, it manages significant daily trips for major brands and is positioned for rapid growth while promoting sustainability and efficiency in logistics.
In Africa, transportation costs can be four times the global average, significantly impacting the prices of essential goods such as food and medicine. According to the African Development Bank (AfDB), logistics account for 75% of the product costs in the region. Many businesses depend on manual logistics, contributing to delays in delivery and escalating prices.
Nairobi-based logistic firm Leta aims to address these challenges with its innovative AI-powered platform. This software-as-a-service solution optimizes delivery routes, monitors shipments in real-time, streamlines payment processes, and provides actionable insights into shipping for businesses across the continent. Leta has successfully secured $5 million in seed funding to expand its operations, with the round being led by European VC firm Speedinvest, along with support from Google’s Africa Investment Fund.
Previously, in November 2022, Leta raised $3 million in pre-seed funding, enabling it to strengthen its operations in key markets including Kenya, Nigeria, Uganda, Zambia, and Zimbabwe. The company’s technology facilitates load and route optimization, which in turn enhances delivery efficiency and reduces transportation costs by minimizing vehicle requirements.
Founder and CEO Nick Joshi elaborates on the platform’s integration with businesses’ operational systems, which allows real-time access to vital order data. By assessing live data on inventory and customer orders, the platform determines the most appropriate vehicle for each dispatch, opting for either the first-in, first-out (FIFO) or last-in, first-out (LIFO) methods, thereby refining manual dispatching processes.
Moreover, Leta automates manifest creation and dispatch planning, thereby optimizing vehicle use according to demand and capacity. Joshi states that the AI technology drives real-time route optimization, dynamically adjusting to road conditions and challenges, such as blocked routes or infrastructural developments.
Leta’s continuous mapping improvements have attracted Google’s interest, particularly due to the outdated nature of Google Maps in certain areas of Nairobi. By producing more accurate maps from live delivery data, Leta aims to enhance logistical networks across the region. Joshi envisions future financial services that can augment their software solutions, including fuel cards and supply chain financing for businesses.
Speedinvest’s Deepali Nangia noted that the firm chose to invest in Leta for its ability to use logistics as an entry point into financial technology, thereby facilitating new business prospects. Additionally, Leta contributes to sustainability initiatives by helping businesses reduce their fleet sizes and, consequently, fuel consumption and greenhouse gas emissions.
Currently, Leta supports over 35 prominent companies, such as KFC and Diageo, and manages over 10,000 daily trips. The startup has experienced significant growth, with deliveries increasing from 500,000 to 4.5 million and revenue quintupled since 2022. As the company plans further expansion into new markets, it endeavors to double its revenue in the coming months.
Differing from earlier approaches in the logistics sector, Leta operates exclusively as a software service without ownership of transportation assets. Instead, it collaborates with companies that own fleets, thereby optimizing operational efficiencies. Joshi observes that earlier logistics startups laid the groundwork for the marketplace, allowing Leta to enter with a well-defined understanding of industry needs and expectations.
Leta stands as a transformative force in the logistics sector within Africa, addressing critical inefficiencies and high costs through its AI-driven platform. Its success in securing significant funding illustrates the potential for innovative solutions to enhance delivery efficiency and accessibility in the region. By focusing solely on software and integrating with existing fleet owners, Leta positions itself uniquely in comparison to traditional asset-heavy logistics models. As it continues to expand and refine its offerings, the company not only impacts local economies but also promotes sustainability within the logistics sector.
Original Source: techcrunch.com
