Tuesday saw the launch of the Pakistani startup Trukkr, which revealed that it had raised $6.4 million in a seed round to expand as a fintech (financial technology) business and launch loan solutions for truckers.
Accion Venture Lab, a fintech-focused venture capital firm, and Sturgeon Capital in the UK led the funding round for Trukkr. Angel investor Peter Findley, Haitou Global in the US, and Al Zayani Venture Capital in Bahrain also contributed.
Although it has been modified for the local market, the company’s business model is comparable to those of Kargo in Indonesia, Solvento in Mexico, and Kobo 360 in Africa.
Less than 5% of trucking companies using Trukkr’s network have access to financial services, which results in frequent 90-day payment delays and prevents them from paying for costs like fuel, tolls, and truck maintenance.
The CEO and co-founder of Trukkr, Sheryar Bawany, told a source that the company planned to introduce financial products at a “fair risk-adjusted spread” from the benchmark Karachi Interbank Offered Rate (KIBOR).
About 20,000 drivers, according to co-founder Mishal Adamjee, work for 100 of the largest enterprises in the nation, including Shan Foods, Artistic Milliners, International Industries Limited, and Lucky Cement.
Despite a lack of adequate rail and water freight facilities, Adamjee said that Pakistan’s $35 billion per year trucking business is expanding at a 10% rate annually.
The Covid epidemic, according to investor Accion Venture Lab, demonstrated just how dependent the world is on international supply networks. It stated in the announcement, “We want to bet on a company attempting to address inefficiencies in a market packed with potential.”
The need for freight transportation is expected to quadruple by 2025 and expand six-fold to 600 billion freight tonnes-kilometres by 2050, notably when the China-Pakistan Economic Corridor comes online.
Truck It In, BridgeLinx and Freightix are three other freight trade businesses in Pakistan.