Naldo today announced its Series A investment from Softbank Ventures Korea and Qualcomm Ventures. After an initial angel funding in 2013, this is the first major investment for Naldo. Funding will allow for faster scaling of sales, marketing, and product development. Currently Naldo’s service is available in and around the Seoul metropolitan area in South Korea.
Naldo provides immediate delivery of any item that needs to be delivered within a maximum time frame of 90 minutes, by way of a web-based ordering system. The existing offline instant-delivery market in Korea (“quick service” in Korean) is worth $5 billion, with thousands of small local providers carving up the market. Until now, no single player has emerged as a market leader, and this is the gap Naldo aims to fill.
“The industry still runs under the same structure as 10 years ago ,with many pain-points for customers, such as late deliveries, bundled orders, or intransparent pricing,” Naldo chief executive Ludolf Ebner-Chung explained.
Naldo has developed what Ebner-Chung believes will be a more cost-efficient and convenient solution to tackle these heritage problems in the industry. Through the platform, consumers can easily place orders online, removing the need for phone interaction with delivery suppliers. These orders are then distributed to Naldo’s vast driver fleet via a mobile app.
Customers can easily track the status of their order via SMS messages that come from the company’s servers. With an online platform, Naldo avoids the high (variable) cost of a call center, allowing for much cheaper pricing and dramatically improved efficiency when scaling the service nationwide or overseas.
Hundreds of companies and thousands of people use the service in the metropolitan area of Seoul, and the company plans to tap its recent investment to grow based on its strong start.
Ebner-Chung, who started Nalod in March 2013, previously was the founder and former chief executive of Delivery Hero’s Korean operation, Yogiyo. Yogiyo is now in direct competition with the No. 1 player in the highly lucrative Korean food delivery market. German-Korean Ebner-Chung is also a former McKinsey consultant who previously worked for companies such as NCsoft, CDNetworks, and LG Electronics.
Food delivery war in Korea heats up
“We are very fond of online ordering platforms, just like Uber, OpenTable, or now Naldo,” Softbank Ventures Korea’s Ryan Kang said. “There are so many pain points in this old but huge industry. We believe Naldo is the best team to fix these old problems and create a market-leading company.
Ebner-Chung added to that.
“In Korea, people just want things immediately,” he said. That’s why the market is so huge. We have now developed an algorithm to provide a very cost-efficient way to feed into this need. At the same time, we are disrupting the old offline industry. With the new investment, we are going to invest heavily into customer acquisition and customer satisfaction.”
The market for instant delivery is currently a hot investment area, with United Kingdom provider Shutl recently being acquired by eBay. Other similar U.S. providers include Deliv, Zipments, and also Postmates, which either work with shopping malls to compete against Amazon’s instant-delivery option or offer their service directly to customers. Just recently TechCrunch reported a $2 million investment into French provider Tok Tok Tok, which runs the same model and also reported on a similar online logistics startup called GogoVan in Hong Kong.
Read more about Naldo here.
This story originally appeared on betech.asia.