Sendle, which offers flat-rate shipping for small businesses in the e-commerce space, has raised $35 million in a Series C investment round led by Afterpay-backed AP Ventures. Returning investors Federation, Full Circle Venture Capital and NRMA Insurance also participated in the round.
“As we gear up for further growth in the United States, AP Ventures brings valuable experience in international expansion with Afterpay as the number one buy-now-pay-later service in the U.S.,” said James Chin Moody, CEO and co-founder of Sendle. “Our Series C funding will help us to continue to reshape package delivery for small businesses in the U.S. We are excited to be working with an organization as passionate about creating value for small businesses as we are.”
Sendle has now raised $73 million to date. King River Capital, Rampersand, Giant Leap Fund, Black Sheep Capital and Alberts Impact Capital are also backing the company.
Moody declined to provide a company valuation when asked by Modern Shipper, but said Sendle is “on a rapid growth trajectory that has been accelerated by the COVID-fueled e-commerce boom.” He said parcel volumes in the U.S. have increased tenfold since launch in 2019.
“This is a huge vote of confidence in our team, our business model and our ability to reshape package delivery for small businesses in the United States,” Moody told Modern Shipper. “AP Ventures was impressed with our strong growth and how we are strategically positioned to scale internationally. We’re thrilled AP Ventures and our returning investors will be joining us in our next phase of growth.”
Launched in Australia in 2015, Sendle offers local (less than 150 miles) and national rates, but unlike other providers, shippers pay flat rates based on weight. For instance, a small package weighing less than 5 pounds costs $7.30 to send locally and $8.11 to ship nationally under the Sendle Premium plan, which is designed for businesses shipping a minimum of 20 packages a month. There are also Standard (no minimum shipping quantities but slightly higher rates) and Pro plans (minimum 200 packages a month but the lowest possible rates).
Sendle said that small and midsized businesses spend between 10% and 15% of total revenue on shipping costs. To keep costs lower, the company works to acquire excess space on existing carriers for shipments. In addition, all shipments are carbon neutral. Sendle calculates the amount of carbon that could be generated by a package to achieve a carbon yield number. It then uses a portion of each package cost to fund sustainability projects via sustainability program South Pole.
The fast-growing shipping provider saw record growth in 2020 and now has more than 800,000 global users, it said. Package volumes increased tenfold in 2020 compared to 2019 as e-commerce across the globe boomed with stay-at-home orders in place. Funds raised from the Series C round will be used for investment in building out Sendle’s U.S. network of logistics, delivery and technology partners.
“We are building out our own U.S. network but instead of putting more trucks on the road, we work with national and regional carriers to leverage existing delivery trucks and routes to make them more accessible for small businesses,” Moody said. “We’re doing this in close partnership with the carriers, which in turn gives them a simple way to reach an untapped market and make their routes more efficient and profitable.”
Saying that Sendle is “often described as the small business courier service with a digital backbone,” Moody noted the company would continue to build out its partnerships with e-commerce platforms around the world. Sendle has integrations with Shopify (NYSE: SHOP), eBay (NASDAQ: EBAY), Etsy (NASDAQ: ETSY), Squarespace and WooCommerce.
“Package delivery is the backbone of today’s e-commerce ecosystem. As ever-more people shop and sell online, small business shipping will only grow in importance. For small sellers, it’s a critical part of being able to compete on a level playing field,” said Hein Vogel, CEO of AP Ventures.
Afterpay is a buy-now-pay-later payment firm. Its app provides access to hundreds of retailers and allows customers to purchase items in stores and pay for them over six weeks. AP Ventures is based in London. The venture capital firm invests in companies presenting technological innovation. Portfolio companies, in some cases, are able to access Afterpay’s retailer base.
“We’re incredibly excited about the wealth of international experience AP Ventures brings to Sendle. We can’t speak on behalf of Afterpay, but as a portfolio company there certainly may be future opportunities to build synergies that bring real value to merchants and small business customers,” Moody said.