TUNL, a South African parcel shipping platform, has secured $1 million in pre-seed funding from investors, including Founders Factory Africa, Digital Africa Ventures, E4E Africa, and Jozi Angels.
The platform, which claims to help e-commerce merchants save between 50% and 80% on international shipping costs, said the funding will fuel its expansion in its primary market, South Africa, and lay the groundwork for its launch in other key African and emerging markets. CEO Matthew Davey and COO Craig Lowman founded the company in 2022 after Davey sought to solve a challenge he faced as the managing director of a Dutch company that imported South African engineering materials into Europe. The process of moving these materials was cumbersome and expensive, Davey remarked in an interview with TechCrunch, and the experience led him to realize the widespread issue of high shipping costs, particularly for smaller businesses in emerging markets like South Africa.
The current challenges in cross-border shipping cost African businesses an estimated $50 billion annually in missed opportunities. TUNL’s founders identified a recurring issue among small- and medium-sized South African merchants during the pandemic: Shipping costs sometimes surpassed the value of their products. Typically, merchants in Cape Town might offer only a single shipping option, such as DHL, to customers trying to buy their products abroad. What TUNL has done is form partnerships with courier services like UPS and FedEx, secure suitable rates, and subsidize SMEs’ shipping costs by 50% to 75%.
“Our pricing is completely transparent and democratized. We want to ensure that every business, large or small, can have an equal chance to convert overseas sales by reducing the cost of shipping as much as possible,” said Lowman in a statement. On the TUNL platform, merchants offer customers various shipping options during checkout. It handles a diverse range of products, including backpacks, fashion footwear, arts and crafts, books, nanofiber materials and high-performance springs, various types of furniture, musical instruments, and nonperishable products like cosmetics.
“We’re getting messages from merchants saying we’ve transformed their business. They’re adding new employees and growing because of us. And so it’s a win-win for the ecosystem that we can help merchants feel that the South African market is not the only market they can serve and can see the world as the market,” he said. “We’re all about like merchants success, helping them grow internationally, because the consumer markets overseas are just so much bigger than the domestic markets for these sorts of products.”