Having clinched seed funding of under R10-million early last year, SA grocery delivery startup OneCart is looking to close a Series-A round by the end of this month, the startup’s co-founder Lynton Peters has revealed.
The Cape Town based startup works with a number of grocery retailers in South Africa to shop for and deliver groceries for customers.
Durban-born Peters (pictured above, right with co-founder Ariel Navarro) founded the startup in 2016 with Ariel Navarro, after returning from working in Singapore, where the idea for the service came to him.
The two launched the startup’s offering early last year after spending about a year and a half in development.
OneCart is looking to close a Series-A round by the end of this month after last year securing seed funding from a SA investor based in the US
Speaking to Ventureburn last week, Peters said the startup has seen current monthly revenue for 2019 grow by 500% over last year. He said the business was last year experiencing growth of 50% a month.
OneCart was one of the 12 companies that took part in the fourth cohort of venture capital (VC) company Knife Capital’s Grindstone Accelerator. The cohort concluded in recent weeks (see this story).
When asked by Ventureburn on whether Knife Capital is one of the investors that OneCart is in discussions with, Peters said he “could not confirm or deny this”.
He however said being part of the programme was “good validation”for the startup and added that the company is now “more structured” thanks to having attended the programme.
At the beginning of last year the startup landed an undisclosed seed investment from a SA investor based in the US (Peters would not disclose the name of the investor).
When pushed on whether the investment was under R10-million, Peters admitted it was.
‘Delivery fees are less than competitors’
Currently the startup now has over 90 staff, 15 in its office, as well as 35 personal shoppers and 45 drivers. The service is offered in the whole of Gauteng, in KwaZulu-Natal from Umhlanga Rocks to Musgrave and in Cape Town (but not yet in Stellenbosch).
The startup partners with retailers who offer a rebate for purchases made via OneCart. Peters said the startup uses the rebate — in addition to a rate of between 5% and 7% charged on the value of each order — to cover the cost of the personal shoppers.
In addition to this, the startup charges a delivery fee of R40 delivery fee paid by the consumers for each order (he claims OneCart’s delivery fee is less than other retailers with an online shopping offering).
For groceries valued at R1000, this translates to the consumer having to pay about R100 extra for the convenience of having their groceries delivered to their home for them.
The startup has a simple pledge — to deliver groceries to customers within two hours from multiple stores, for any order that is placed on their app of website.
The question now is, whether the new funding — when the startup finally secures the funding it’s after — help grow the offering to more parts of the country?
*Correction: We accidentally mixed up the delivery fee and fee charged to cover the personal shopper. OneCart charges a fee of between 5% and 7% for each order, to cover the cost of a personal shopper and a flat fee of R40 to cover the delivery of each order.
Editor’s note (4 September 2019): OneCart co-founder Lynton Peters clarified that the startup’s unique value proposition of delivering groceries to customers within two hours, for any order that is placed on their app of website, includes delivery from multiple stores. We have amended the article accordingly.
Featured image (from left to right): OneCart founders Ariel Navarro and Lynton Peters (Wesgro via Youtube)