Norwegian startup Xeneta has raised $12 million in a Series B funding round, the company announced Thursday. The lead investment came from London’s Smedvig Capital with more cash coming from Creandum and Alliance Venture. Xeneta is a marketplace using big data to better compare ocean-shipping freight prices, an increasingly popular business idea with startups.
“We were looking for a VC who shared our strategic long-term outlook. Shipping is not a fast-paced industry and Smedvig’s extended investment perspective plays very well with our strategy making them an ideal investment partner,” said Xeneta Co-founder and CEO Patrik Berglund in a press release. Before founding Xeneta, he was a co-founder at logistics company Nordilog AS and spent several years at Oslo shipping outfit Kuehne + Nagel where he met his co-founder and CBDO Thomas Sørbø.
Their success thus far also reflects their central place in the Norwegian startup community. Local organization Startup Norway crowned them Nordic Startup of the Year for 2016.
They face stiff competition for an industry that by its very nature is a global one. Freight-forwarding company Flexport out of Silicon Valley raised its own mega round of $65 million in Series B funding this past September, with backers like the Founders Fund, Ashton Kutcher, Yuri Milner, and Bloomberg Beta. Jerusalem-and-Singapore-based Freightos raised $14 million in October 2015 to launch its own marketplace in this past July then followed that up one month later when it bought Spain’s WebCargoNet to create what they boast is the world’s largest air and sea shipping marketplace. Smaller players like CoLoadX — which has only raised $40,000 in seed money as of last June — are still entering the market.
These companies and other observers might be quick to quip the cliché that international shipping is an industry ripe for disruption, particularly in price comparison. But can Xeneta grow fast enough to grab significant marketshare? There seems to be plenty of room to still get into the battle.
Xeneta says it has tripled revenue over the last year and seen their contracted shipping rates balloonover the last two years. Xeneta is planning to use the money to “obtain even more data points, build new products and test the waters. We need more heads for that and we are currently recruiting for a number of positions,” Berglund wrote in a blog post, separate from the official press release, saying the employee count would soon grow to 40 people.
In what might be one of the more, frankly, genuine quotes this reporter has ever read in a press release, Creandum partner Fredrik Cassel extolled Xeneta as love at first sight.
“Xeneta is one of my favorite Creandum seed deals because from the very first meeting you could see such a massive potential in the team and in the opportunity to bring price transparency to global freight. Xeneta has developed phenomenally and we’re very happy to welcome Smedvig Capital as co-investors, as we share the founders’ long-term vision for the company.”