GoGoVan, an app that connects van drivers and users, wants to make last-mile deliveries easier for users throughout Asia. The Hong Kong based startup was founded in summer 2013 and now claims over 50% of the van driver market there, with over 18,000 van drivers using its service.
It recently launched in Singapore, where GoGoVan signed up more than 200 drivers in the first week. Now it plans to roll out in another Asian country within the next few weeks and expand to more markets within the region over the next three to six months before eventually going to other continents.
GoGoVan executive chairman Gabriel Fong says the startup wants to replace traditional van call centers in the way taxi- and ride-sharing apps have replaced taxi call centers.
He adds that once a customer calls a vans through its app, a driver will respond in an average of 10 to 15 seconds, compared to a 20 to 30 minute wait through a van calling center. Users currently include individual consumers who are moving house or have large items they need delivered; small companies that need to deliver things to customers; and large corporations that don’t find it cost-efficient to operate their own fleet of vans.
The startup declined to divulge its funding, but says it recently received a seven-figure amount round. Its investors include Brian Brille, ex-chairman of Merrill Lynch Asia Pacific, and other private and individual investors.
In Hong Kong, GoGoVan already has competition, including EasyVan, which was launched about six months after GoGoVan. GoGoVan says its headstart has allowed it to grow a larger fleet than other on-demand delivery companies, which gives it a faster response time. Its user base has also moved from individual users to SMEs and corporations, which means that its platform now has about 7,000 daily transactions and its customers are more likely to return for other deliveries.
“In every dense metropolitan city, there is a large fleet of vans, motorcycles, trucks, etc., providing last-mile logistics solutions. Some of these vehicles are company-owned and therefore captive and used exclusively for their own requirements. However, there is a large proposition which is essentially owner-operators, whether individually or owned by a small business owner with three to five vehicles,” says Fong.
“For example, in Hong Kong, 35,000 vans of the 70,000 registered vans fall into this category. Our business model is to the link the latter group of vehicles to the ultimate end user in a far more efficient way through an app.”
He adds that many customers in Hong Kong relied on classifieds and call stations when they need a last-mile delivery van. “The call stations have only 50 to 1,000 vans on each of their platforms and therefore are very restricted to narrowly defined routes.”
For drivers, Fong says GoGoVan offers them less idling time as they wait for users to reach them through various channels, increased income (for some drivers, income increased up 20% to 30%, he says).
Fong identifies a market for GoGoVan’s services in Sydney, Melbourne, Seoul, Tokyo, and other major cities in the Asia-Pacific region, as well as Hong Kong and Singapore, where it already operates. It also plans to tackle big cities in the U.S. and Europe as well.
“We are not reinventing or creating the need for such logistical requirements,” says Fong. “We are simply making it more efficient for these demands to be fulfilled and met, by making it far easier to connect the users to the van drivers.”