Pakistan’s financial technology and logistics startup PostEx has announced that it is raising $1.5 million in seed funding from leading institutional investors to resolve the challenges of Cash on Delivery with instant and upfront payments by scaling its one-stop-shop for financing and logistics solutions for e-commerce platforms.
The round was led by global VC MSA Capital that has previously invested in Uber, Klarna, Nubank, and Swvl. UAE-based Shorooq Partners, Pakistan-focused Zayn Capital, VentureSouq, PNO Ventures, and 92Ventures also participated in the round. The CEO of Pakistan-based Arbisoft, Yasser Bashir, also attended as an angel investor.
Running a business online in a primarily cash-based economy comes with the challenges of cash recovery cycles that impeding scaling due to working capital constraints. Challenges on the last-mile delivery front lead to high cancellations, and a lack of financing options adversely affects the growth of e-commerce businesses in Pakistan.
PostEx addresses both the challenges by providing upfront payment on Cash on Delivery (COD) orders, complemented by an efficient in-house logistics fleet for e-commerce businesses, thereby helping businesses grow via easy and instant access to cash and liquidity.
The Co-founder and CEO of PostEx, Omer Khan, said, “Pakistan’s e-commerce landscape is rapidly evolving and lack of access to financing opportunities is hampering the growth of online merchants and e-commerce landscape broadly. Our goal is to be the first and last source of funds of fast-growing e-commerce businesses to meet all their capital requirements to accelerate their growth.”
“With fresh funds and a capacity to provide over $50 million a year in financing to companies, we are on a mission to change the face of lending in Pakistan,” he added.
In consideration of the increasing volume of digital payments, PostEx had also introduced a digital payments solution that enables businesses to collect consumers’ payments online through PostEx’s checkout plugins.
Tim Chen of MSA Capital remarked, “The rapid growth of e-commerce in Pakistan is being held back by high levels of COD. PostEx’s integrated instant payments with logistics is a model we have backed globally to resolve the hurdles posed by CoD and believe that Omer and team have the execution capabilities to build a regional leader”.
The all-encompassing financial product and digital payments complemented by logistics provide PostEx the perfect moat and positions it uniquely as a one-stop-shop for e-commerce with the increasing number of retailers selling their goods online.
“PostEX is solving key problems for the rapidly scaling e-commerce market in Pakistan through its factoring and logistics solution. Their innovative approach creates stickiness with retailers, providing them last mile and working capital solutions eventually becoming their financial products solutions provider,” said Faisal Aftab, Co-Founder and Managing Partner at Zayn Capital.
Tamer Azer, a Partner at Shorooq Partners, said, “For us at Shorooq Partners, Post-Ex represents the perfect intersection for our views on the potential of the Pakistani market as well as our deep appreciation for infrastructure support organizations in the eCommerce industry. A fantastic team building the right product that eliminates clear complexities facing many merchants looking to grow their ecommerce businesses”.
Founded by Omer Khan, Saad Mahmood, Babar Razzaq, and Adil Naseem, PostEx is aimed at utilizing the funds to grow its products and bring depth to its existing technology-based COD financing platform. Currently operating with a team of over 150 members, it plans to further grow its team as it scales to new clients and services.