INDONESIAN logistics startup, Waresix, has secured US$14.5 million in a Series A funding round, led by EV Growth, a South-east Asia growth fund set up by regional venture capital (VC) firm East Ventures.
Also participating in this round are Singapore-based Jungle Ventures and Indonesian VC firm, SMDV.
This is the third time East Ventures has invested in Waresix. It previously participated in Waresix's seed funding round in February last year, as well as its pre-Series A round of US$1.6 million in October 2018.
Waresix connects shippers and businesses with available warehouses and trucks across Indonesia. The company claims that its ecosystem includes over 20,000 trucks and 200 warehouses across the country.
The fresh funding will be used to expand Waresix's land transportation service, and for investment in research and development to improve its data analytics capabilities, the company said.
Added Andree Susanto, CEO of Waresix: "Our mission is to simplify logistics and make it accessible for everyone; with this new capital, we want to scale and expand our coverage to support the digital transformation of Indonesia's US$240 billion domestic freight sector.
"We will continue developing our land transportation and warehousing network to more second-tier cities across the country, and make further improvements to the supply-chain process. Indonesia is experiencing an infrastructure growth spurt at the moment thanks to the the government's policies, and this spurt will fuel Waresix’s widening coverage as well."
The startup is also looking to increase its investment on hiring talents, particularly those with expertise in data science, operations, logistics, finance, design, marketing and sales.
According to the 2018 Logistics Performance Index, the World Bank found that while Indonesia's logistics sector has improved in recent years, the country still lags behind that of its regional peers Thailand and Malaysia.
Waresix aims to tackle this problem by improving utilisation and removing middle men who broker logistics, the company said. Its services include land and marine transportation, general cargo handling, and cold storage to cater to inter-island freight movement across Indonesia.
Willson Cuaca, managing partner at East Ventures, believes that logistics play an important role in Indonesia's economic growth.
"Put simply, the more efficient our logistics are, the more competitive our products become. This is only one of the simplest examples of how logistics affect the nation's economy. However, there are many things to be improved in Indonesia. The average logistics cost in Indonesia still make up 24 per cent of the nation's GDP (gross domestic product), and 74 per cent of these costs are spent on transportation," said Mr Cuaca.
He added that one way to lower these costs is by building a strong and efficient infrastructure, especially for transportation.
"The government understands this as well, which is why they have been very aggressive in building the infrastructure the past few years. East Ventures agrees with the government's initiatives, and wants to support it by investing in logistics leaders like Waresix."