Truck Lagbe, the Dhaka-based digital trucking startup that connects people and corporate customers with truck owners and drivers through an app and a website, has raised $4 million in Series A funding round led by International Finance Corporation, an investment arm of World Bank Group, and co-led by IDLC Venture Capital Fund I. Other participants in the round included Millville Opportunities Master Fund, Shorooq Partners, Colopl Next, and TRU Fund I, per a press release.
Truck Lagbe provides short-haul and long-haul freight trips, with trucks of different sizes, across all 64 districts in Bangladesh. The company connects businesses with truck drivers and fleet owners through an app-based platform. Over 80,000 truck owners and drivers are registered on the platform serving thousands of customers daily. The company operates an on-demand marketplace serving SMEs and consumers, and a brokerage serving larger companies on credit. The company will utilize the capital to expand the team, acquire drivers, expand its presence in new districts, and introduce value-added services.
By leveraging technology, the company matches demand and supply for freight services, offers price transparency, real-time tracking of shipments through GPS technology, and maximizes truck utilization, driving efficiencies across the logistics value chain.
“As traditional methods became inaccessible during the COVID-19 pandemic, Truck Lagbe became the go-to platform for thousands of small businesses and truck owners for hiring trucks. This helped them to continue their business,” said Anayet Rashid, Truck Lagbe’s Co-Founder and CEO. “We are thrilled to have IFC lead our Series A. This will help us to expand in every district of Bangladesh along with bringing in various support services to facilitate everyone to move from the fragmented and unorganized local market to our tech-driven logistics platform.”
Transport and logistics services have faced severe financial stress and job losses due to the impact of COVID-19. Digital platforms such as Truck Lagbe offer the opportunity to support economic recovery by improving transport connectivity, facilitating trade flows, and generating additional income and productivity gains in supply chains.
“It is crucial for Bangladesh, which aims to become a middle-income country over the next decade, to have an efficient transport infrastructure and logistics services, which not only provides more support for the shipment of goods during the pandemic but can also help transport exports to markets,” said Nuzhat Anwar, IFC’s Acting Country Manager for Bangladesh, Bhutan, and Nepal. “In addition to its financing, IFC is providing the company with the knowledge and innovative support by leveraging insights from previous investments and will be connecting Truck Lagbe to more prospective clients.”
“Bangladesh’s logistics industry is transforming from manual to digital. Being in the banking industry for over two decades, I have personally seen the growth of the logistics businesses and the crucial role it plays to keep the economic engine of our country thrive. So, we are extremely happy with this investment and to support the team as it directly impacts our GDP growth,” said Syed Javed Noor, Deputy Managing Director at IDLC and Partner at IDLC Venture Capital Fund I.
The transport and logistics services market in Bangladesh has a value of US$15 billion (PwC 2018), equivalent to 6.8 percent of gross domestic product, GDP. IFC’s investment will support the expansion of the Truck Lagbe operations, help widen the logistics network in the Bangladesh market, and support the expansion of value-added services for truck owners through the sale of fuel, tyres, and lubricants.
Truck Lagbe’s technology platform empowers small truck owners by displaying their available trucks and price quotations, as well as easy access to market information, enabling truck owners to find freight jobs, improve their income and more effectively utilize their trucks.
Truck Lagbe was founded in July 2017 by Anayet Rashid and Mir Hossain Ekram where customers booked trucks through a call center. It won the “Startup Challenge 2017” competition in 2017, organized by the Information and Communication Technology Division of the government of Bangladesh. The company launched its app in September 2018 and raised a seed round led by Ravid Chowdhury, the former CFO of the Bangladeshi ride-hailing company Pathao. Other early investors include Betatron Venture Group, Seedstars, Mount Parker Ventures, Aria Group, Falcon Network, and Development Finance Asia.