Sydney-based logistics and shipping business Shippit has rejected a $5 million investment offer in its Series A funding round, instead accepting $2.2 million to fund in order to drive its growth and Asia-Pacific expansion.
250,000 parcels are delivered via Shippit’s platform each month, and many of the company’s 750 clients are major retailers, including Harvey Norman, Sephora, Topshop, Thankyou and Pet Circle.
Shippit’s Series A funding round attracted strong investor interest due in part to the company’s announcement of significant growth of its subscriber base and a 200 per cent increase in monthly profits.
“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,” said co-CEO Rob Hango-Zada.
Hango-Zada and his co-CEO William On decided to reject the $5 million investment secured through the funding round, having calculated that the growth push would cost around $2 million.
“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 [$2.2 million],” Hango-Zada added.
“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.”
Lead investor Aura Group, a well-established venture fund, has experience dealing in the APAC market, which will benefit Shippit as it makes its bid for the market.
“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,” said Eric Chan, Managing Director, Aura Group.
“The predominant reason we invested, however, was because we believe Shippit has the right founders to execute on a well-considered strategy and vision.”