Warehousing1 has announced the completion of its €10 million Series A funding round, co-led by Wille Finance and Aster, with participation from DB Schenker and existing investors HV Capital and Base 10.
With this additional money, the company, led by the talented trio Nils Aschmann, Fabian Sedlmayr and Nico Szeli, will focus on doubling down on its product development and international expansion. Their medium-term goal is to become the player of choice for European merchants that want to have logistics services that meet the high standards set by Amazon without being dependent on the US tech giant.
At Aster, we have been diving deep into the logistics space as a whole for some time and were particularly convinced about the opportunity to join forces with Warehousing1 for several reasons.
Covid-19 has accelerated an already growing trend for e-commerce in Europe
Warehouses and fulfillment centers have been the nervous system of the global economy since the Covid-19 pandemic stroke in early 2020. As consumption shifted massively online, brands and retailers understood that the new battleground for winning customer satisfaction and retention was the delivery experience. Covid-19 was not solely responsible for this. Since its inception, Amazon has been raising the bar in terms of customer expectations, with next-day delivery for Prime-labelled products now the norm in most urban agglomerates. Even before Covid-19, e-commerce revenue in Europe had been growing strongly, sustaining a 9% CAGR for the last 5 years. Covid-19 provided a great 20% YoY growth boost, as direct consequence of country lockdowns. Storing and fulfillment operations, a key link in the delivery value chain, started to come under pressure: this has created a great momentum for innovation (and startups) in this space.
Thus, we started to investigate how e-commerce brands and retailers have been facing the surge of orders behind the scenes, and here’s what we found out:
Scaling digital interfaces takes months, while scaling physical operations take years.
Today, online retailers can scale their e-commerce business in months with modern digital tools spanning from sales (Shopify, Amazon), marketing (Google Ads, Mailchimp), payment (Stripe, Klarna) and customer experience (Zendesk, Zenloop). However, when it comes to scaling logistics, retailers still need to go through months of logistics service provider (LSP) evaluation and IT onboarding and repeat the entire process each time they reach maximum warehouse capacity or want to enter new geographies and/or markets.
Alternatively, brands and retailers can also rely on e-commerce giant marketplaces, such as Amazon, and their logistics infrastructure. However, this is not the preferred option for growing D2C brands, which wouldn’t be able to fully communicate their brand by selling on Amazon. Furthermore, Amazon turns down accounts that do not generate sufficient volumes – thus retailers need alternatives. For merchants that do not want to rely on e-commerce giants for their logistics operations, independent platforms such as Berlin-based startup Warehousing1 are the most attractive option.
Warehousing1 offers one of the most complete product suites on the market
Warehousing1 has created a marketplace that connects fast-growing online merchants within dependent LSPs. Warehousing1’s clients can access all LSPs on the platform and scale their warehousing and fulfillment capacity instantly, with no upfront costs and without the hassle of sourcing, evaluating, and negotiating with LSPs themselves. Thus, they can focus on what they love most: creating outstanding products for their customers.
But Warehousing1 is far from being a mere broker of logistics services. Nils, Fabian and Nico, along with their great team, built the software infrastructure to seamlessly connect IT systems of merchants and logistics providers. This gives merchants real-time visibility of orders and inventory, enables automated change and cancellation workflows and the updating of fulfilment rules.
Likewise, Warehousing1 has a compelling value proposition for LSPs, as it makes them instantly visible to a myriad of online merchants who are striving to scale their logistics and bring new business to them without any additional overhead costs.
Joining forces with a high-potential founding team that is undertaking a long journey to crack the e-commerce logistics space.
While several startups in the e-commerce logistics space have already received strong VC attention, we believe there is still a long way to go. Specifically, we are interested in the warehousing and fulfillment-as-a-Service “space”, which offers all the benefits of decentralized warehousing, without its major drawbacks (higher operating and inventory costs). Specifically, through a network of geographically distributed warehouses, shippers can:
- Reduce shipping costs and delivery times by storing their products closer to their customers;
- Expand storage capacity without having to build or lease new infrastructure, simply by upgrading their subscription;
- Mitigate the risk of labor shortage by spreading inventory across different locations.
We are very proud to back the three co-founders of Warehousing1 and, while this is their first startup founded and led together, we believe that their previous experience is very relevant to what they are trying to achieve.
Neil worked in supply chain management at DSM and as a consultant at Porsche where he learned about contract logistics and the challenges faced by fast growing e-commerce players.
Fabian worked at an LSP and later as a consultant at PwC and McKinsey & Co. He met Nico, the third co-founder, at the Barcelona-based startup studio HS3,, who previously worked in market strategy and planning for Procter & Gamble.
Their first-hand experience of the logistics challenges, for both industrial and e-commerce players, as well as their strong commitment to becoming the reference e-commerce fulfillment and logistics service platform European fast-growing European merchants, make us even more excited to join forces now, at the beginning of the journey to the conquest. 🚀