PostEx, a Pakistani fintech and logistics startup, announced on Monday that it has raised an additional $7.1 million to extend its seed round after raising $1.5m last month.
"This brings the total capital secured by the company at seed to $8.6m, making it the second largest investment at this stage in Pakistan," a statement issued by the startup said.
It added that the extension round was led by Global Founders Capital (GFC) along with participation from FJ Labs — an investor in companies such as Alibaba and Ant Financial — Russian venture capital (VC) firm ru-NET, Alma Capital, Zayn Capital, MSA Capital, Shorooq Partners and Swvl Chief Financial Officer Youssef Salem.
With the influx of new funds, the startup aims to increase its vertical lending.
"Our focus from the very beginning has been to become the go-to growth platform for merchants looking to realise their potential. We are at the forefront of innovative technology solutions that bridge merchants’ logistics needs with their capital requirements," the statement quoted founder Muhammad Omer Khan as saying.
He said PostEx was the "differentiator" that helped merchants grow faster and more economically with its range of customised financial products compared to traditional financial providers that underserved the segment.
Tito Cost of GFC said that the startup offered a "unique product" to e-commerce players in Pakistan's ecosystem that would allow them to access the capital required for growth. "We are excited to back the team as they build out their suite of financial and fulfilment products," the statement quoted him as saying.
FJ Labs Founding Partner Fabrice Grinda said they were "thrilled" to partner with PostEx for their "first-ever investment" in Pakistan. He pointed out that Pakistan was one of the "largest untapped frontier markets going through digital transformation".
Services like PostEx's technology and financial products would form the "backbone of this future" by supporting local merchants to grow faster, Grinda added.
Kirill Kozhevnikov, a partner with ru-Net, also expressed excitement over the deal. "We see tremendous potential in emerging markets such as Pakistan, Bangladesh and MENA (Middle East and North Africa). Big and growing market, disruptive business model and exceptional entrepreneurial talent — our must-haves criteria for portfolio companies — were matched in the 20th minute of the first meeting," the statement quoted him as saying.
The startup's statement pointed out that the wider e-commerce logistics space has picked up steam recently and seen increasing interest from local and foreign investors.
"Other than PostEx, Rider has also secured foreign VC-led investment worth $2.3m while BlueEx went the other way and listed itself on the Growth and Enterprise Market board of the Pakistan Stock Exchange, raising around $2.5m," the statement added.
Founded by Khan, Saad Mahmood, Babar Razzaq and Adil Naseem, PostEx plans to utilise the funds to grow its products and bring depth to its existing technology-based cash-on-delivery financing platform. Currently operating with a team of over 150 members, it plans to further grow its team as it scales to new clients and services.