Small business parcel delivery start-up Sendle has secured $5 million in funding from investors including Full Circle Venture Capital, Black Sheep Capital and rampersand.
The capital raise comes as the business has recorded 20 per cent month-on-month growth for the past year, giving its founder and chief executive James Chin Moody confidence in the future growth potential of the firm.
Mr Moody said the $5 million would go towards expanding Sendle’s features and scaling its customer support capacity.
“At the very heart we’re a software company and we have more demand for features than we do people to satisfy the demand,” he said.
Sendle founder James Chin Moody says the business is in a high growth phase.
“The second thing is we want to continue to deliver world-class customer support. It’s very important to small businesses. Thinking about the difference between a large company and someone at home selling goods is they want to watch every parcel, so they want us to take the same care that they have making it.”
Sendle caters to small parcel deliveries and charges cheaper rates than Australia Post because it taps into the delivery networks of big businesses.
It is also the first investment made by new fund Giant Leap, which is run by the Impact Investment Group and only invests in companies that are making an environmental or social impact.
Previously the logistics business had raised a total of $3 million, with the NRMA leading the last $1.8 million raise. The NRMA has also joined this funding round, as have other high net worth investors which have previously backed the start-up.
As well as allowing small businesses to send parcels more cheaply, Sendle is the only carbon neutral delivery service in Australia.
Mr Moody said while the company had been growing extremely quickly in the past 12 months, he does not anticipate such high growth rates to continue long term.
“It’s hard to keep growing at this rate, although we’d love to. The real technology behind Sendle is the ability to unlock big business parcel logistics and make it available to small business in the easiest way possible,” he said.
“What we’re looking at in terms of additional things we can do is around insurance options, which are important to small businesses, and then a few other things which I won’t mention yet.”
Sendle now facilitates $100 million of small business commerce annually and while many of its customers are micro businesses, some more well-known brands such as Who Gives a Crap and The Good Beer Co are also using Sendle.
Australia Post battle
Since August last year Sendle and its competitor Australia Post have been engaged in a trademark battle, with the delivery giant opposing Sendle’s slogan “post without the office”.
Australia Post has argued that the slogan is deceptively similar to a number of Australia Post trademarks.
Mr Moody said the dispute was ongoing, but had not proceeded to court yet.
Sendle has also challenged Australia Post over its exclusive use of PO boxes. In a submission to the Australian Competition and Consumer Commission’s letter pricing inquiry last year, the start-up said it wanted businesses and other courier companies to be able to deliver to PO boxes.
rampersand managing partner Jim Cassidy said he was attracted to Sendle because it follows a similar model to Airbnb and Uber.
“[It’s building] a highly valuable business without owning the infrastructure, and actually using existing infrastructure significantly more efficiently,” he said.
The other investors all made mention of Sendle’s strong leadership team and high growth.
“Sendle is one of the most impressive start-ups to cross our desks in recent times. A great founder and awesome team, a solution to a real pain point for SMEs, a product that people love, and a major distributor to multi-billion dollar industry,” Black Sheep Capital director Daniel Gavel said.
Ultimately, Mr Moody said he wanted Sendle to be the preferred delivery service for all Australian small businesses.
“We’ve worked hard to also partner with other businesses that care about SMEs, so NAB is now a partner with Sendle and it offers free Sendle Premium to their small business customers and they also give them a dollar off every parcel,” he said.
“Etsy is doing the same thing and we’re looking to launch other significant partnerships in order to create opportunities for small business.”
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