Lori Systems
Overview
Lori Systems is a Nairobi-based logistics company utilizing technology to streamline the transportation of goods across Africa. Founded in 2016 by Josh Sandler, Jean-Claude Homawoo, and Ernest Gichini Ngaruiya, the company operates an online marketplace that connects cargo owners with transport providers. Lori Systems has raised approximately $39.7 million in funding from investors including Google and Liquid 2 Ventures. The company aims to reduce logistics costs, which account for a significant portion of product prices in Africa, by improving the efficiency of haulage services.
Recent Developments
- April 2025: Lori's valuation has significantly decreased from $120 million to $5 million in its latest funding round. This was a bridge round led by Delta40, with participation from Future Africa and others, raising $2 million.
- 2025 Developments: Lori has been exploring a new financial model to address cash flow issues common in African logistics startups. This involves allowing banks to directly finance transportation, reducing liquidity strains.
- Expansion and Technology Initiatives: The company is expanding its tech stack to include AI for route planning and electric vehicles to cut costs.
- Achieving Profitability: Lori's CEO Jean-Claude Homawoo expressed optimism about achieving profitability in 2025, which could enhance access to traditional bank financing.
- Valuation and Market Challenges: Shrinking valuations in African logistics highlighted the challenges faced by startups in delivering expected growth. Despite this, investors remain bullish due to Africa's enormous logistics market potential.
Company Information
| Attribute | Information |
|---|---|
| Founding Date | 2016 |
| Headquarters | Nairobi, Kenya |
| Founders | Josh Sandler, Jean-Claude Homawoo, Gichini Ngaruiya |
| Revenue | Approximately $8.7 million |
| Key Investors | Google, Delta40, Future Africa |
| Industry | Logistics |
| Number of Employees | Approximately 212 |
Early History
Lori Systems was founded in Nairobi in 2016, emerging from Josh Sandler's experience studying supply chain challenges in Africa. The company's first product was a logistics platform aimed at reducing the high costs and inefficiencies associated with freight transport across the continent. From its inception, Lori Systems focused on technology-driven solutions, winning TechCrunch Battlefield Africa in 2017, which helped to raise its profile and attract initial seed funding.
Company Profile and Achievements
Lori Systems operates a digital logistics platform designed to coordinate haulage across Africa effectively. The company addresses the logistical challenges posed by Africa's fragmented transport infrastructure, offering an efficient marketplace for cargo transportation services:
- Innovative Marketplace: Lori's platform uses technology to match shippers with reliable and vetted transport providers, optimizing routes and reducing empty return trips, which lowers costs.
- Investment and Growth: Since its launch, Lori has secured $39.7 million across several funding rounds. It leveraged its strategic position by attracting investment from global giants like Google.
- Strategic Partnerships: Lori Systems collaborates with large industry players and has undertaken significant projects like managing logistics from Kenya's standard gauge railway.
- Scaling Operations: The platform facilitates operations in several African countries, including Kenya, Uganda, Rwanda, and Nigeria, employing a network of approximately 20,000 trucks.
Current Operations and Market Position
Lori Systems is focused on expanding its digital and operational footprint across Africa. The company leverages data and analytics to enhance logistics efficiency, aiming to lower the high transportation costs endemic to the region:
- Market Expansion: Lori operates in key African markets with plans for further expansion. It aims to assist in reducing logistics costs, which can be 75% of total product costs in certain regions.
- Competitive Advances: Lori's strategic advantage lies in its technology-driven model and extensive network, which provides reliability and cost savings.
- Strategic Initiatives: It is investing in AI for better logistics planning and exploring the deployment of electric vehicles to further reduce costs.
Conclusion
Lori Systems has positioned itself as a leading logistics solution provider in Africa, addressing significant inefficiencies in the continent's transport and supply chain sectors. Despite recent financial challenges and a significant drop in valuation, Lori continues to be a pivotal player in Africa's logistics landscape. With its focus on digital innovation and strategic growth, the company is well-positioned to leverage the increasing demand for efficient logistics services across Africa, potentially transforming the industry's landscape.