The pandemic bought a boost to the trend of online shopping. While online stores existed well before the pandemic as well but it wasn’t until after it, that a vast majority of people took to online stores and websites even for their everyday essentials. This not only benefitted the previously existing online retailers but now, even those who didn’t have an online presence before, well acquainted themselves with social media and other platforms to boost their sales and reach a wider customer base.
This in turn created a new market gap and gave rise to a business model, which though did exist before but wasn’t as big a part of the everyday life of the masses. Now, there was a need for a service that would act as a bridge between the online stores and the customer, a service that accepted both cash on delivery, and online payments. It wouldn’t be an understatement to say, that after only a few months into the pandemic the market saw the ingression of a great many cash-on-delivery services. We even witnessed the rise of some buy now and pay later services, but that discussion is for another time.
Among such cash-on-delivery startups, one was PostEX. PostEx functions as a hybrid of receivables factoring solution and courier service and pays invoice values upfront to E-commerce companies offering cash on delivery as one of their modes of payment.
What is PostEX?
Founded back in 2020 the company offers online retailers upfront payments for their cash-on-delivery orders, for a fixed fee. While the startup works with online retailers as their last-mile logistics partner, what gives it an edge over other players in the market is that it doesn’t make sellers wait in order to receive the payments for their cash-on-delivery orders.
The startup aspires to make delivery service smooth and instantaneous by transforming conventional delivery into modernized delivery with instant and upfront cash on customer orders.
Background of Founders
Muhammad Omer Khan
Omar is a CFA level 3 candidate, who started his professional career as a Financial Analyst. In 2013 he joined EY as a Senior and after three years there, joined Nasco Middle East as a Wealth Manager. In 2017 he joined the Dubai-based, Querencia Financial Analysis & Consultancy as an investment analyst and then finally in 2019 founded PostEX alongside his partners.
Adil Naseem
Adil is an alumnus of the National College of Business Administration and Economics, with a bachelor’s in Business Finance and Marketing. He started his professional journey as a TeleSales Supervisor at Ovex Technologies.
In 2011 he joined the Dubai-based Al Hanoo Holding Company, as a Business Development Officer. Then in 2015, he joined Systems Limited as Senior Business Development Executive. Adil has worked at a number of well-known organizations including CureMD, Careem, and the Dubai-based, Hala. Then in 2020, he joined PostEX as a co-founder.
Saad Mahmood
In 2015, Saad joined Packages Limited as Finance Specialist. Then after a year, he join 24 News as head of operations and worked there for over two years. Finally, in 2020, he co-founded PostEx.
Babar Razzaq
Babar is a University of Punjab alumnus, with a bachelor’s in IT(Computer Science). He started his career at NetSol technologies as a Software Engineer. Then in 2010, he joined InfoTech as a Senior Software Engineer.
After 7 years he switched and joined Nisum as Senior Technical Lead. In 2018, he joined Systems Limited as a Managing Consultant and then joined PostEX in 2021 as Director and CTO.
Why PostEx?
A vast majority of the consumers who are well versed in the customs of online shopping in Pakistan, pay using the cash-on-delivery payment method, while the payment cycles for such orders easily range between a week to a month which creates cash flow issues for the online sellers. This is where PostEx’s model comes into play. The company is trying to find a solution to such problems via its fintech and logistics platform. In addition to a cash-on-delivery service, PostEx also offers a payment gateway that the retailers can integrate on their respective websites to accept online payments using cards, bank accounts, and mobile wallets.
Currently, PostEx’s competition in the market includes Rider, Swyft, and Trax, other than the giants such as TCS and Leopards. However, despite facing heavy competition the company’s fintech-first approach makes it stand out in the market and allows it to reach out to businesses with the value proposition of solving their liquidity problems first, coupled with a delivery service.
So far, this strategy has helped PostEx grow by signing up merchants for financing their invoice values upfront, on which PostEx earns by charging a fixed commission. At the same time, providing the merchants with the option to sign up for delivery services as well.
Features Offered by PostEx
- Secure payments: PostEx authentication, both non-3D, and 3DS is intended to assist the user in capturing more money.
- Lowest Price: With PostEx, users can start accepting online payments for as low as 3 percent.
- Go Global: Customers from all around the world can use any major debit or credit card at PostEx.
- No transaction fee: The retailers are not charged a fee for any transaction, allowing them to expand their business with Paid.
- One-click integrations: PostEx also provides one-click prebuilt plugin interfaces for systems like Shopify, wooCommerce, Magento, and others. This once integrated can be up and running in a span of 10 minutes.
- Zero integration fee/annual fees: You can make your transaction accept digital payments seamless at zero charges with PostEx.
Funding Raised
Seed Funding: Raised $8.1 million
In October 2021, the company raised a seed round of $1.5 million. The round was led by MSA Capital, while other investors including Shorooq Partners, Zayn Capital, VentureSouq, PNO Ventures, +92 Ventures, and Arbisoft’s CEO Yasser Bashir also participated in the deal.
Then only after a month, in November 2021 PostEx extended its seed round by securing an additional $7.1 million. The extension round was led by Global Founders Capital (GFC) 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’s Chief Financial Officer Youssef Salem.
In a statement, Tito Costa, Partner at Global Founders Capital said:
PostEx offers a unique product to e-commerce players in the Pakistani ecosystem, allowing them to unlock precious capital to accelerate their growth. We are excited to back the team as they build out their suite of financial and fulfillment products.
Future Plans
Last year PostEX also launched a digital payments feature to help meet the growing demand for digital payment services. The digital payments features provide an all-encompassing platform for online merchants to keep a track of their cash flows, payments, and deliveries.
According to the company, the newly raised funds are going to be directed towards strengthening the existing system as well as introducing new digital payment products and services, to provide a better experience for merchants and their consumers.
Furthermore, the balance is going to be used to fund the company’s geographical expansion.
While talking to menabytes, Omer Khan, co-founder, and CEO of PostEX said:
Pakistan’s e-commerce landscape is rapidly evolving and a lack of access to financing opportunities is hampering the growth of online merchants and the e-commerce landscape broadly. Our goal is to be the first and last source of funds for fast-growing e-commerce businesses to meet all their capital requirements to accelerate their growth. With fresh funds and a capacity to provide over $50 million a year in financing to companies, we are on a mission to change the face of lending in Pakistan.