Fresh from graduating from the Y Combinator winter batch, Egyptian startup Flexstock has raised the largest pre-seed yet in the Middle East and North African region. Surpassing the record set just 2 months ago by fellow Egyptian and YC winter batch startup Dayra. The fintech company raised $3 million in debt and equity.
Flextock is a ecommerce fulfillment provider for Africa and the Middle East.
What is e-commerce fuffillment?
When merchants launch their e-commerce businesses, they can easily manage the end-to-end operations in the early stages. But as they begin to grow, managing their own operations, from warehousing and logistics to delivery and cash collection, can become difficult. This can prevent them from scaling effectively despite having a steady inflow of demand.
Now, there’s a need to offload some of this workload. This is where e-commerce fulfillment services come in handy.
Mohamed Mossaad and Enas Siam founded Flextock in September 2020. However, the company didn’t launch until January 2021. Mossaad, the company’s CEO, describes Flextock as a tech-enabled fulfillment provider. When merchants sign up to the platform, they send their products to one of the company’s fulfillment centers. Flextock takes the whole catalog and tags the products for tracking purposes. Then, integration is made between Flextock and any online store they use, be it Shopify, WooCommerce, Wix or Odoo, among others.
As orders are made, Flextock packages and ships the products from the fulfillment center to the customers. Currently serving the egyptian market, It leverages proprietary software to offer merchants end-to-end e-commerce fulfillment and logistics solutions on demand. Since its launch, the company claims to have signed more than 100 merchants to its platform, with thousands of stock-keeping units (SKUs). The company also says it is growing 25% week-on-week.
Flextock doesn’t own any delivery vehicles, so to achieve this, the company partners with existing logistics companies in Egypt. This model has helped the startup to create a marketplace for different last-mile delivery companies in the country.
The investors in this round include Egyptian VC Foundation Ventures, Y Combinator, MSA Capital, CRE Ventures, Alter Global, Jameel Investment Management Company (JIMCO), B&Y Ventures Partners and Access Bridge Ventures. The company also received angel investments from an unnamed Sequoia Capital scout, investors in the GCC region and Flexport.
In the MENA region, Trella is another Egyptian logistics company backed by YC. The accelerator has now invested in four logistics and digital freight focused startups, including Nigeria’s Kobo and SEND, ever since it successfully backed Flexport in 2014.