May 3, 2016
By Zoe FloodBusiness reporter, Kenya
Meshack Alloys knows the challenges of delivering goods in Kenya only too
well.
"In the past we worked with a couple of bus and courier companies in East
Africa, and we saw that most of them had issues with last-mile logistics,"
remembers Meshack Alloys, chief executive of Sendy, a Kenya-based logistics
website and mobile phone app.
"I actually grew up in a village here in Kenya… I have seen the road
network being a problem - as I grew up, I saw how products would basically
reach the end person at a cost that was high," says 29-year-old Mr Alloys
in his office in Kenya's capital Nairobi, notorious for its severe traffic
jams.
In response, Mr Alloys and two friends, who had worked together for a bus
company, developed a 24/7 on-demand platform that connects individuals or
companies looking to dispatch packages, with motorbike riders offering
delivery services.
"There are traditional courier companies that might do overnight or
same-day delivery, but they don't do immediate, and they might not go
residential," explains Malaika Judd, the 30-year-old US chief operating
officer of Sendy, who left a Nairobi-based investment fund to join the
start-up.
Sendy initially worked with motorbike riders - known popularly in Kenya as
boda bodas - but has expanded to include pick-up trucks, large vans and
cyclists.
[image: A Sendy courier]Image captionSendy's couriers all work for
themselves
"These are all crowd-sourced riders," adds Ms Judd. "We don't physically
own any of the vehicles or the bicycles, and all the riders, cyclists and
drivers work for themselves on the platform."
The platform operates in a way that would be familiar to any user of Uber -
a user enters the required delivery route, and is given a price quote. Once
the pick-up is requested, users can track the rider, and then follow a
package to its point of delivery.
Payment is made through a pre-registered credit card, or using the popular
M-Pesa mobile money transfer platform.
Problem solving
Sendy started by using very simple technology that worked with basic
phones, using SMS and USSD technology and GPS trackers on bikes. But as the
price of smartphones has come down, the company is rolling out a hybrid app
that also works on riders' smartphones.
"We wanted to solve this problem using existing assets and people… we
didn't want them to buy fancy gadgets, expensive gadgets to do that," says
Mr Alloys.
[image: Sendy's office]Image captionAnalysts say Sendy now has to show that
it can grow
"We looked at how do we make these people utilise their assets to the
maximum and bring down the cost."
Since it launched its first product in April 2014, Sendy has completed more
than 20,000 deliveries - averaging between 150 and 200 per day - and has
around 60 active riders on the platform, all of whom are vetted.
For Sendy rider Geoffrey Oloo, reliability of work is a key attraction of
the platform. Riders take away 80% of each delivery fee, which starts at a
base amount of KES240 ($2.40; £1.60) for the first 7km.
"You are sure in a day that you will get work because there are so many
customers in the Sendy system," he says. "When I am with Sendy I am sure at
the end of the day that I will having something in my pocket, something I
can take home."
Some 75% of daily deliveries are done for corporate business accounts and
the rest for individuals.
[image: Sendy's service can be accessed by either computer or mobile phone]
Sendy works with businesses including e-commerce firms dispatching
purchased goods around the bustling Kenyan capital, food companies offering
home delivery, and pharmacies moving medicine to patients.
The company is hoping to launch an investment round within the next six
months, having successfully attracted funding from corporate and tech
investment funds, as well as local angels, in an earlier investment last
year.
The team is eager to expand to new cities - both within Kenya and beyond -
using hoped-for funding in the next investment round.
Having watched Sendy's emergence, tech blogger Moses Kemibaro sees
scalability as the company's next hurdle.
"I think their big challenge is really scaling it to get as many people as
possible onto the service before some big international player checks into
the market, which potentially could compromise the opportunity to grow,"
says Mr Kemibaro.
[image: A Sendy courier checking the app]Image captionSendy is hoping to
expand into other markets
"Already in Kenya, we have seen other on-demand service providers like
EasyTaxi and Uber doing well," he adds.
"Increasingly, you will see such providers moving into markets like Mombasa
and Nakuru. I think Sendy do have the same potential, but the question at
the end of the day is really whether they have the resources to expand."
The Sendy team also hope that the service will help to offer solutions to
some basic infrastructural problems that are common in the East African
region.
"Traffic is a huge issue, infrastructure of roads is an issue, quality of
data on a map is an issue, addressing is an issue, actually having a house
number is an issue, street names is an issue," explains Ms Judd.
"While we are providing these on demand services, we are also improving a
lot of the base infrastructure… for example we can collect data on all
these addresses, we can save these addresses and I can understand now
residential locations.
"We can capitalise on the fact that we can beat the traffic by using
individuals on two wheels, cyclists or riders. So all of these challenges
are also really cool opportunities for Sendy to beat the alternative
solutions out there."
--
Ann Marie
"The art of living consists of knowing what to pay attention to and what to
ignore." -- Mardy Grothe
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