Lagos-based MVX, which started as a booking service for chartered sea vessels but pivoted into a digital freight forwarding and trade finance venture last year, has raised $1.3 million in seed funding to help merchant shippers move cargoes faster.
MVX raised the funding from Kepple Africa Ventures, The Continent Venture Partners, Founders Factory, Launch Africa and Capital Oak. A few angel investors from the US, Japan, Nigeria, and South Africa also participated, the startup said, without disclosing their identities.
With the investment, the two-year-old startup plans to hire staff, expand its operations, and improve its technology. MVX is also talking to investors to raise more money, most likely debt, for its trade financing product.
The company was founded by Tonye Membere-Otaji, who failed in his first two attempts at entrepreneurship. Membere-Otaji had initially launched a tech startup, Membere & Longe, but didn’t succeed and joined maritime logistics company Elschon in 2015.
A few months later he planned an “Uber for Ships’ ‘ under the name MVcharter. This venture, too, didn’t take off.
In 2019, Membere-Otaji teamed up with Tobi Amusan to float MVxchange, a platform to match ships with charterers in West Africa’s offshore oil and gas ecosystem, with pre-seed funding of $100,000 from African VC firm Oui Capital. Amusan is now CTO at MVX.
MVX charges a commission for the services provided, including trucking, warehousing, shipping, and cargo stuffing.
The company launched a new product, MVXtransit, last year. MVXtransit is a digital freight platform that allows booking and deployment for import, export and land haulage besides customs brokerage in Nigeria, South Africa, Kenya, Tanzania, Rwanda and Ghana. It exports from these six African countries to the rest of the world.
Recently, the company also launched MVXpay, a finance and payment solution for freight operators. The overall business now operates under the MVX banner.
MVX is one of a handful of Sub-Saharan logistics-tech startups to get funding this year. Another peer that raised cash recently is Jetstream, a technology-enabled supply chain venture based in Ghana.
Jetstream, located in the city of Tema, bagged $3 million in a seed round from Alitheia IDF, Golden Palm Investments, 4DX Ventures, Lightspeed Venture Partners, Asia Pacific Land, Breyer Labs and MSA Capital.
The startup has positioned itself as a data-driven vertical broker for cross-border trade in Africa. Its platform is backed by a fulfilment network of third-party customs brokers, freight forwarders, terminal operators, and other logistics providers in each trade corridor.
In a statement, Membere-Otaji said:
“We make it easy and convenient for businesses. Instead of trying to do everything themselves, which can be chaotic and cause distraction from their core businesses, we handle everything because we have all these service providers in one platform. So as shippers work with us, MVX works with like seven to 10 other service providers,”
Some merchants lack adequate capital to pay for freight or supply and they are looking to move shipments from Africa to the U.S or China, so this concept works best for them to the best of their trade. By using MVX, they can request credit. It then passes it on to its financial partners, who lend out the money to consumers if they meet the minimum requirement.
Next, MVX sends the shipment overseas and manages its delivery. Once the transaction is done, the merchant pays back, with all partners taking commissions.
The company has recorded more than 300 shipments this year but plans to end with 1,500. Per revenue and traction, the CEO claims the company has surpassed its 2020 numbers.