Grace Ashiru
Pargo, a South African eCommerce logistics startup, has announced its expansion into Egypt following a successful $4 million funding round. The funding round was led by 3Capital Ventures formerly part of Allan Gray), Endeavor, SAAD Investment Holdings, and UW Ventures. The startup has launched its collect and return services at over 500 Pargo Points in Egypt, with plans to use the funding to accelerate its growth in the country’s eCommerce sector.
The Egyptian eCommerce market has seen significant growth in recent years and is projected to expand even further.
Fueled by rising internet penetration, improved infrastructure, and a growing number of online shoppers, the eCommerce market in Egypt is estimated to reach $9.05 billion in 2024 and is projected to grow to $18.04 billion by 2029, with a compound annual growth rate (CAGR) of 14.80% during the forecast period (2024-2029).
Lars Veul, CEO of Pargo, recognized the potential of the Egyptian market and stated that the expansion marks a significant step toward building the largest smart logistics network in the region.
Despite the growing adoption of eCommerce in Africa, a GSMA study highlights major challenges in logistics and delivery processes, including damaged goods during delivery, limited delivery capacity when needed, and slow delivery times. These issues are said to drive up costs and reduce the revenue generated from online sales.
However, Veul stated that the startup aims to offer affordable eCommerce delivery solutions to improve access for online shoppers across Africa, addressing the challenges that eCommerce companies currently face in servicing these markets.
Lars Veul and Derk Hoekert founded Pargo in 2015 as a smart logistics company, offering eCommerce delivery solutions through its network of over 4,000 tech-enabled Pargo Points. The company has reportedly connected major platforms like Amazon, Bash, and Jumia with a large base of online shoppers.
The startup launched a pilot in Egypt in 2023, establishing 150 Pargo Points to test its solution with various eCommerce companies and their online shoppers. It also introduced a new “Cash on Collection” payment option.
Pargo aims to expand to 7,000 pickup points across the region by 2026 while continuing to partner with local businesses and brands.
