ABA Editorial · Jul 12, 2025 · 14 min read
Digital freight platforms including Kobo360, Lori Systems, and Sendy attracted over USD 130 million in combined venture capital during 2019 to 2022, promising to transform fragmented African trucking markets. Most of that capital has since been written down or is in uncertain status. This report maps the trucking landscape, the structural reasons the category has struggled commercially, and the lessons for future operators.
African road freight is one of the largest components of African logistics by both physical volume and economic value. Trucking moves the majority of goods between production sites, ports, wholesale markets, and retail destinations across most of the continent, with a network of truck owners, operators, and intermediaries that functions through a mix of formal and informal arrangements. Over the 2019 to 2022 period, a wave of venture-backed digital freight platforms including Kobo360, Lori Systems, and Sendy attempted to transform this market by applying matching technology similar to what Uber had applied to passenger transport. The thesis was compelling on paper: trucks were operating at low utilization rates, with empty return trips wasting capacity that digital platforms could capture; prices were opaque and often inflated by multiple layers of intermediation; and the fragmented nature of truck ownership meant that no single operator had the scale needed to serve large enterprise customers efficiently. Digital platforms, the thesis went, could solve these problems by aggregating demand, matching it efficiently with supply, and building durable network effects that would support sustainable commercial operations. The execution has proved far more difficult than the thesis anticipated, and most of the capital that went into the category has since been written down or is in uncertain status. This report maps the trucking landscape and the lessons for future operators.
Kobo360 is the most documented example of the digital freight category. Founded in 2017 in Lagos by Obi Ozor and Ife Oyedele II, the company was part of Y Combinator's summer 2018 cohort and quickly attracted investor attention as a prototypical Africa-adapted tech platform. The funding trajectory was impressive: seed round in 2018 at approximately USD 6 million, Series A in 2019 at USD 30 million (including USD 20 million equity led by Goldman Sachs and USD 10 million working capital from Nigerian commercial banks), and a 2021 round that combined equity and debt totaling approximately USD 48 million. Cumulative disclosed funding reached approximately USD 79 million.
The company's operational metrics at peak were equally impressive. Kobo360 reported a fleet of more than 10,000 drivers and trucks operating on its platform, with enterprise clients including Honeywell, Olam, Unilever, Dangote, and DHL. Geographic expansion extended from Nigeria into Togo, Ghana, and Kenya, with plans for further expansion that never fully materialized.
The structural vulnerability was working capital. Kobo360 operated a model that paid truck drivers upfront (which was necessary to maintain driver participation in a market where cash flow is paramount) but had to wait 30 to 90 days for manufacturers and distributors to settle invoices. The gap between these two cash flow events required ongoing working capital financing that Kobo360 obtained through bank credit lines. When a financial partner cut off the credit line over unserviced debt, the company lost access to customer accounts and its trip volumes collapsed. Driver payments became delayed, which damaged the driver network, which reduced platform supply, which further reduced capacity to serve customers. By 2024, Kobo360 had laid off most staff and was operating at a minimal level.
In March 2025, Obi Ozor (who had left in 2023 to become Enugu State transport commissioner) bought back the company from its investors, who wrote down their equity in what represented a significant loss for backers including Juven (an offshoot of Goldman Sachs), the IFC, and TLcom Capital. Ozor assumed approximately NGN 10 billion (around USD 15.82 million) in existing debt and announced a revival plan focused on traditional financing and haulage partnerships rather than venture capital, leading a small team of under ten people.
Lori Systems, founded in Kenya, was the other major East African digital freight platform. The company raised over USD 25 million across funding rounds, built cross-border trucking operations, and was frequently cited alongside Kobo360 as evidence of the category's promise. Lori Systems has not disclosed new funding rounds in recent years, and its current operational status and capital position are matters of industry speculation rather than public disclosure.
Sendy, also founded in Kenya in 2015 by Alloys, Evanson Biwott, Don Okoth, and Malaika Judd, raised approximately USD 26.5 million from Toyota Tsusho, Atlantica Ventures, VestedWorld, Keppel Capital, Enza Capital, AAIC Investment, Sunu Capital, and Goodwill Investments. The company pivoted away from its original logistics model and ultimately shut down in August 2023, with over 200 employees affected. Prior to shutdown, Sendy was reportedly in discussions with other African B2B commerce and trucking operators including Trella, Sabi, and Wasoko about asset sales, though the full outcome of those discussions has not been comprehensively disclosed.
The common thread across Kobo360, Lori Systems, and Sendy is that each company faced a structural mismatch between the working capital requirements of their business models and the capital available to fund those requirements on commercially sustainable terms. Digital freight matching can improve utilization and pricing transparency, but it cannot eliminate the underlying need to pay drivers when they deliver loads regardless of when customers settle invoices. That working capital need must be financed somehow, and the terms on which it can be financed determine whether the overall business model produces acceptable unit economics.
Software companies can scale with low marginal costs and thin working capital. Logistics companies cannot. Every additional truck that joins the platform creates additional working capital requirement. Every additional client served expands the invoice receivable balance. The unit economics depend not only on the margins captured per trip but also on the cost of financing the working capital gap. In an environment where bank credit is expensive and unreliable and venture equity demands rapid growth, financing these gaps sustainably requires either unusually favorable credit arrangements or business model adaptations that change the underlying cash flow profile.
A small number of newer operators have been building African trucking businesses with more conservative operational models. Renda, Fez Delivery, and Cargo Plus (the three operators that raised the combined USD 2.1 million in 2024) represent this category. These operators have typically chosen narrower geographic focus, specific customer segments, or hybrid models that combine technology platforms with direct operational control over subsets of their fleets. The smaller funding rounds reflect both the broader capital contraction and the more conservative growth targets that newer operators are pursuing.
Whether this more conservative approach produces sustainable long-term businesses remains to be determined. The structural case for digital freight in African markets has not changed; what has changed is the recognition that the business model must be built around realistic working capital and credit assumptions rather than around the software-company analogies that drove earlier rounds.
Three indicators will shape African road freight. First, whether Obi Ozor's revived Kobo360 demonstrates that traditional financing approaches can sustain a smaller but commercially viable freight operation. Second, whether newer operators like Renda, Fez Delivery, and Cargo Plus grow beyond their current scale on sustainable unit economics. Third, whether alternative financing sources including supply chain finance platforms, asset-backed lenders, and development finance institutions step in to provide the working capital that commercial banks have been unwilling to lend at acceptable terms. The African trucking category has lost its most visible operators but not its underlying opportunity, and the next wave of operators will inherit both the hard lessons and the structural case that the first wave established.