Hong Kong-based courier and delivery startup Lalamove's $300 million fundraising will allow it to expand its business in Southeast Asia and India, managing director Mark Au told FinanceAsia on Thursday.
Speaking right after the company announced its series D round of funding, Au said the new capital will be used to diversify and improve its service offerings in Southeast Asia where competition is getting increasingly intense. At the same time, it will also be used for its newly-established network in India.
Lalamove is now Hong Kong’s biggest startup after the completion of the latest funding round, led by Hillhouse Capital and Sequoia Capital. Existing shareholders including PV Capital, MindWorks Ventures and Shunwei Capital – the venture capital fund established by Xiaomi founder Lei Jun – also participated in the latest round.
The series D funding came 14 months after Lalamove's $100 million series C funding round in October 2017.
The high-flying logistics company is currently the only Hong Kong-based startup valued at over $1 billion. While the city’s small size has somehow limited room for on-demand logistics services, Lalamove has been able to break into regional markets including China, Southeast Asia and India, to maintain growth.
India is Lalamove’s new venture. The startup commenced its delivery services in Mumbai last month and is scheduled to begin services in Bangalore and New Delhi this month.
Au believes India will be a major driver for the company’s growth as the country has one of the fastest-growing logistics markets in the region.
“India’s logistics industry is expected to grow to $215 billion in two years from around $160 billion. You can see the massive potential there,” Au told FinanceAsia. He said Lalamove will ensure it is successful in first-tier cities before extending its network across more Indian cities in the future.
Meanwhile, Lalamove will continue to build its network across Southeast Asia depsite intense competition.
Au believes the company’s focus on enhancing customer support and technological innovation will differentiate it from other service providers.
“The competitive landscape of logistics in Southeast Asia has been ramping up as significant funding has been injected into the sector,” Au said. “However, we always believe that a great customer experience will win the market as our customers expect us to be reliable, fast and provide exceptional customer support.”
One of the characteristics of the Southeast Asia market is the wide usage of motorbikes as a form of transportation.
To this end, Lalamove, which builds its logistics services primarily with trucks and vans in Hong Kong, launched its services with motorbikes first in markets like Thailand, Vietnam, Indonesia and the Philippines, to cater to the needs of local customers.
As of February, Lalamove said its platform had 28 million registered users and 3 million drivers. It said it tripled its sales last year. Au also said that while Lalamove has no immediate plans for an initial public offering, it may consider a public listing in future.
