Leta Innovates African Logistics with AI Technology and Seed Funding
Leta is a Kenyan logistics startup harnessing AI to reduce transport costs in Africa, where businesses spend significantly more on logistics. The firm has raised $5 million in funding to expand its software solutions for efficient delivery. Its approach involves real-time order processing and vehicle optimization without owning assets, making it a unique player in the logistics space.
In Africa, businesses face high logistics costs, paying up to four times the global average, with logistics accounting for 75% of product costs, according to the African Development Bank. Nairobi-based Leta is addressing these challenges through its AI-powered logistics software-as-a-service platform that optimizes delivery processes, tracks shipments, and improves payment systems.
Leta has successfully raised $5 million in seed funding, with European venture capital firm Speedinvest leading the investment, alongside support from Google’s Africa Investment Fund and the climate tech fund Equator. This funding will help scale its logistics solutions for businesses, which aims to make goods transport cheaper and more efficient across the continent.
The startup previously raised $3 million in pre-seed funding in November 2022, which helped enhance operations in key markets: Kenya, Nigeria, Uganda, Zambia, and Zimbabwe. Leta’s technology focuses on load and route optimization, allowing clients to reduce costs and improve delivery efficiency while minimizing the number of vehicles required.
Leta’s platform integrates with businesses’ existing systems (ERP, POS, and OMS), gathering real-time order data to automate vehicle selection for each delivery. It intelligently decides on loading methods, FIFO (First In, First Out) or LIFO (Last In, First Out), shifting away from manual dispatching.
The automation extends to manifest creation and dispatch planning by optimizing vehicle use according to regional demands. AI further enhances route optimization, continuously updating delivery maps to account for changes like road conditions and traffic obstacles, improving overall efficiency.
Leta’s real-time mapping capabilities prove beneficial to Google, as its database offers fresher data than Google Maps in certain regions. This unique value proposition enhances both companies’ efficiencies. Additionally, Leta is exploring financial products—including fuel cards and supply chain financing—expanding its platform’s offerings within the supply chain.
Deepali Nangia from Speedinvest emphasized investment in Leta for its potential to use logistics as a gateway to fintech, thereby generating new opportunities. The platform has already enabled major savings for businesses, exemplified by claims of a typical client saving $30,000 a month by optimizing fleet sizes and operations, while also working towards tracking and reducing carbon emissions.
Currently, Leta supports over 35 major businesses, including international players like KFC and Diageo, optimizing over 10,000 deliveries daily. Its growth has been remarkable, evidenced by increasing delivered goods from 20,000 tons to an impressive 150,000 tons, and boosting vehicle management from 2,000 to 7,400, resulting in a fivefold revenue increase.
Plans are in place to further expand operations into other African and Middle Eastern markets, with ambitions to double revenue. Unlike other logistics firms in Africa that have opted for asset-heavy models, Leta provides its solution solely through software, leveraging existing fleet companies for efficiency gains, aligning with global successful practices in logistics technology.
Leta is transforming the logistics landscape in Africa by leveraging AI technology to reduce costs and improve efficiency. With significant funding and strategic partnerships, the startup optimizes delivery processes while fostering new opportunities in embedded finance. Its software-centric approach positions it distinctly within the market, potentially providing a template for future logistics and tech solutions in the continent. As it aims for further expansion and revenue growth, Leta’s innovative methods may reshape how logistics operates in Africa.
Original Source: techcrunch.com
