“Doubling down”: Sendle closes oversubscribed $20 million Series B round to fuel overseas growth
Tuesday, January 29, 2019/
Aussie delivery startup Sendle has raised $20 million in Series B funding, as co-founder and chief James Chin-Moody pledges to win more market share from Australia Post, and to take his disruptive courier overseas.
The series B funding was led by Federation Asset Management, marking one of the fund’s first investments. The round also included repeat investment from Full Circle Venture Capital, Rampersand and Giant Leap Fund.
Launched four years ago to provide SMEs with an alternative to Australia Post, Sendle now has a staff of 85 people, while its customer base has grown 600% over the past two years.
The startup raised $5 million in Series A funding in August 2016. Since then, Chin-Moody tells StartupSmart, “the most important thing we’ve really done is refine our focus”.
The founders have learnt a lot in this time, including “around what the needs of small business are and Sendle’s model, and how we add value”, he adds.
The funding is pegged for creating more value for SMEs through new products, services and partnerships, Chin-Moody says.
“We’re doubling down on growth … pushing growing our market share,” he adds.
“It’s amazing how many small businesses don’t know about us.”
Sendle will also start the process of taking its services overseas, something Chin-Moody says will be “interesting”.
“A business like ours may not have come about in any other country,” he says.
“If you can do logistics in Australia, you can do it anywhere.”
That said, he also stresses this overseas growth is subject to “not losing our focus on Australia”.
Sendle is somewhat infamous for taking on Australia Post and winning. In May 2017, the startup won a trademark dispute over its slogan “post without the office”.
Over Christmas 2018, Sendle launched a campaign offering customers $13.45 flat-rate postage to anywhere in the world, for parcels up to 250g.
“The moment we announced it, our volumes of international deliveries doubled,” Chin-Moody says.
“A lot of small businesses who had never shipped internationally before started to.”
However, the founder maintains he’s not out to destroy the incumbent postal giant, calling it “an essential part of Australia”.
“They do provide logistics services,” he says.
“We’re here to provide competition.”
“It’s not just investment”
This latest funding round was oversubscribed, Chin-Moody says, however, it’s always been important to the founders to get investors on board who are aligned with their vision and values.
“We look for more than just funds,” he says, adding that all the backers “add value in different ways”.
Full Circle has helped Sendle refine its business model; Rampersand has been integral in helping it recruit the best new people; and impact investment fund Giant Leap has worked closely with the startup on getting its social purpose, and the environmental aspect of the business, on point.
“They’re all very values-aligned,” Chin-Moody adds.
“It’s not just investment.”
Aside from choosing investors carefully, the biggest lesson Chin-Moody has learnt is about being laser-focused.
“As a startup, that’s the real challenge. Where do you apply your focus to get the best solution?”
Often, if your startup isn’t getting traction, it can feel like it’s because you’re not doing enough, he says.
“It’s often the opposite. Sometimes you’re doing too much and not focusing on the feature you think is really critical, and the channel that really works.”
While previously, the big companies may have eaten the small, “now the fast eat the slow”, he says.
“The big advantage you have as a startup is that you can move quickly.”
So, how do you know if you’re focusing on the right thing? There’s no easy answer, Chin-Moody says.
“That’s the thing about learning. You’ve got to continually pay attention to your customer base and what they’re saying,” he says.
“Make sure you’re continually challenging your own assumptions about the business,” he adds.
“We have tools we can use to talk. We need to use those same tools to listen.”
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