Sendstack ditches last-mile delivery, pivots to logistics software for corporates

Sendstack, a logistics platform for small and medium-sized businesses backed by OnDeck, is sunsetting its flagship last-mile delivery product, DLVR.

It will now focus on a new product called CTRL, which will help businesses route and track deliveries, maintain communication with drivers and customers, process payments, and gain insights about operations from a dashboard.

While DLVR targeted small and medium-sized businesses needing last-mile delivery partners, CTRL targets large corporations with existing logistics teams. These businesses can have onboard in-house fleets of delivery vehicles or third-party partners.

The decision to sunset DLVR is surprising, considering the cofounder’s claim that it served 20,000 businesses, generated $250,000 in revenue, and was profitable after fulfillment. 

However, the cofounders Ifeoma Nwobu and Emeka Mba-Kalu claimed that DLVR was a means to an end—a way for SendStack to learn firsthand the problems of logistics management that SendStack was designing CTRL to solve.

“We probably should have let DLVR go earlier,” Mba-Kalu said on a call with TechCabal. “There is probably a [version of an] economy where we could have run both, but juggling both became challenging.”

CTRL moves the two-year-old startup closer to its goal of becoming the digital logistics infrastructure for African businesses to find multiple logistics providers to move goods, the company claims.

Mba-Kalu believes CTRL is also a comparably easier product to scale. “You can easily replicate it in emerging markets like South East Asia  that has a lot of economic activity and a fragmented logistics system.”

While this presents a cheaper growth opportunity for the startup, it also presents a new challenge: convincing traditional businesses to adopt new technology which may require significant structural changes, including the education of delivery drivers and logistics teams. 

Concluding sales with these businesses can also take a significantly long time.  As Guy Futi, founder of Orda, noted during a Moonshot panel discussion, selling software to large enterprises can be lengthy, taking up to six months. Moreover, integrating such software across multiple branches can extend to a year or more.

“There are a lot of businesses who are comfortable doing things manually and they move fast,“  Ifeoma Nwobu, SendStack’s co-founder and COO noted on a podcast. 

Sendstack’s pitch to these businesses is that consolidating every point of their logistics process on one platform can significantly reduce overhead costs and the time wasted on resolving conflicts arising from delayed or poor communication among delivery partners.

Younger and digital-first businesses in e-commerce, food delivery, telemedicine and more may be a more accessible target market.

Technologies like Sendstack’s CTRL are gradually gaining traction, and for good reason. The B2B logistics sector is highly competitive but software that promises to optimise the infrastructure of existing players levels the playing field for new entrants.

In Kenya, startups like Leta have seen significant traction. The startup claims it expanded to five countries, including Kenya, Tanzania, Zimbabwe, Uganda, and Zambia, in the first two years of operation.  The startup has also tapped customers like the fast food chain Simbisa Brands, Chandaria Industries, and Twiga Food. One can expect to see more startups toeing the line.