Ozor, who left his role as CEO in 2023 to serve as Enugu’s transport commissioner, has returned to lead a skeleton crew of fewer than ten employees. His mission: to revive the struggling startup through traditional financing and haulage partnerships. This move represents a last-ditch effort to salvage what remains of Kobo360’s operations.
For investors like Goldman Sachs’ Juven, the International Finance Corporation (IFC), and TLcom Capital, the sale is a stark write-off. These backers had once seen Kobo360 as a transformative player in Africa’s logistics sector. However, the company’s struggles underscore the harsh realities of freight tech on the continent, where thin margins, high capital requirements, and unreliable cash flows pose significant hurdles.
“The challenging macroeconomic environment has created headwinds for startups across emerging markets, including in the logistics sector,” the IFC stated in a comment . “IFC remains committed to supporting entrepreneurs driving innovation and development across the continent.”
A Promising Start, a Painful Decline
Founded in 2017, Kobo360 aimed to revolutionize freight logistics by digitizing the process of matching truck owners with businesses needing to transport goods. The platform promised to reduce inefficiencies, minimize empty return trips, and improve pricing transparency—addressing long-standing issues that make logistics one of Africa’s most expensive sectors.
For a time, the model appeared to work. In 2019, the startup secured $20 million in Series A funding, followed by a $48 million Series B in 2021. At its peak, Kobo360 aggregated over 50,000 trucks, expanded into multiple countries, and partnered with corporate giants like Unilever, Dangote, and DHL.
However, the company’s reliance on working capital proved to be its downfall. Kobo360 paid truck drivers upfront but had to wait 30 to 90 days for manufacturers and distributors to settle invoices. This cash flow gap forced the startup to depend heavily on bank credit lines—a lifeline that was abruptly cut when a financial partner withdrew support over unserviced debt.
“Losing access to our customers’ domiciled accounts was a major blow,” said a former employee, who requested anonymity. “These were key clients, and their departure drastically reduced trip volumes, revenue, and overall growth.”
A Sector-Wide Struggle
Kobo360’s troubles reflect broader challenges in Africa’s logistics sector. Unlike fintech or e-commerce, which benefit from low marginal costs and network effects, freight tech is capital-intensive and heavily reliant on credit cycles. As venture capital firms shift their focus from aggressive expansion to profitability, investor interest in logistics startups has waned.
In 2024, only three African logistics startups—Renda, Fez Delivery, and Cargo Plus—secured venture funding, raising a combined $2.1 million. This pales in comparison to previous years’ investments. Meanwhile, other high-profile players like Lori Systems and Sendy have either gone quiet or pivoted away from logistics altogether.
Can Ozor Turn the Tide?
The big question now is whether Obi Ozor can breathe new life into Kobo360 without the backing of venture capital. Sources close to the company suggest he is exploring traditional financing and haulage partnerships to restart operations. However, details remain scarce, and the CEO position is still vacant.
As Kobo360 charts an uncertain path forward, its story serves as a cautionary tale for startups navigating the complex realities of Africa’s logistics landscape. Whether Ozor can steer the company back to relevance remains to be seen, but the odds are undeniably steep.