Home Articles Shippit rejects $5M investment and secures a strategic $2.2M Series A round...

Shippit rejects $5M investment and secures a strategic $2.2M Series A round instead

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Shipping management platform Shippit.com recently announced it has secured AU$2.2 million in Series A funding, which will drive the company’s expansion into APAC within the next 12 months and scale its growth.

The raise was led by prominent APAC venture fund Aura Group, whose notable investments include Catapult Sports, Freedom Insurance and Institchu. The capital injection will also support their focus on sales and marketing efforts while expanding their product engineering team to continue building a world-class solution to a global problem.

Additional capital was also secured from Addventure Fund and  RTL Group Investments. Shippit joins a portfolio of investments across its new partners, which includes the likes of Slack, Yahoo, Flipboard, Houzz, SocietyOne, Primo Smallgoods and Temple & Webster.

Originally seeking $3 million, the funding round was oversubscribed and attracted a total offering of $5 million from interested investors. The Series A was run by one of Shippit’s advisors, Howard Leibman of Equity Venture Partners, who also ran Deputy’s US$25M raise earlier this year.

How has Shippit attracted this funding?

Shippit co-founder and Joint-CEO, Rob Hango-Zada, said that whilst he and co-founder and Joint-CEO, William On, were pleased to have met the initial funding target, they decided to reevaluate the figure following overwhelming interest from investors and exponential growth.

“During the raising process, Shippit’s user base grew ahead of our projections which reduced our capital requirement and prompted us to review our growth ambitions. In this time, our subscriber base grew by over 40 per cent, with around a 200 per cent increase in monthly revenue. We’ve always been fiscally responsible, however when we reconsidered the amount that was required to fuel our next phase of growth, the figure was actually much closer to $2 million,” said Hango-Zada.

“We received a humbling flurry of interest, however we didn’t think it would be wise to accept more capital than we actually required. The purpose of this raise was specifically to obtain growth capital to invest in strategic hires, building out the local team, as well as supporting rapid expansion into international markets,” he said.

Eric Chan, Managing Director of Aura Group said “Shippit stood out to us because of the scalability of its platform and its alignment to the global opportunity being driven by the transition of retail into e-commerce. The predominant reason we invested however, was because we believe Shippit has the right founders to execute on a well-considered strategy and vision”.

Shippit offers a product that improves a client’s fulfilment process and their customers’ shopping experience in a unique way, which is proven by its strong traction in the market over a short period of time,” said Chan.

What next for Shippit?

Shippit now has its sights on the APAC market and plans to expand into the region within the next 12 months. The market presents a lucrative opportunity for the business as one of the world’s fastest-growing regions for e-commerce revenue, poised to be worth US$25 billion by 2020 (according to Frost and Sullivan).

“Signing Aura [Group] as our lead investor was a strategic decision for Shippit. Their strong presence and networks throughout APAC puts us in good stead to launch into the region as we aim to make our software available to retailers across the globe,” he said.

The funding builds on Shippit’s momentum in the Australian market since launching to the public in 2015. The company currently services over 750 merchants including Sephora, Topshop, Thankyou, Pet Circle, and ships over 250,000 parcels via its platform each month.