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Kanga offers a SaaS-based platform for on-demand delivery

The company is looking to solve the challenges of on-demand delivery for the enterprise

Entrepreneur interview by Steven Loeb
November 13, 2015
Short URL: http://vator.tv/n/4157

We are hosting our second annual Post Seed (#postseedconf) event on Dec. 1 at Ruby Skye in San Francisco. The event - which we expect to draw more than 500 attendees - kicks off at 8 am and ends around 5 pm. We're excited to have Cory Johnson, anchor at Bloomberg West, broadcasting live from 7 am to 11 am PST. It should be a riveting day! Register here: Post Seed 2015.

At our annual Vator Splash LA event last month, we were proud to announce that Kanga Technology, a member of the Splash LA Class of 2015 cohort, had won the People's Choice Award.

Kanga Technology develops enterprise software to solve the challenges of last-mile, same-day, and on-demand delivery of physical goods. Its platform helps both emerging startups and Enterprises manage their same-day delivery needs and hire needed drivers without a huge capital investment.

The company has raised $1.75 million in funding, and is currently closing a $1.5 million Series A round.

I spoke to Everett Steele, CEO and Founder of Kanga, about his company, its origins and how he wants to change the delivery space.

The origins of Kanga

Founded in August of 2013, Kanga's software powers crowd-sourced local deliveries, and provides its clients with a white-label friendly solution to answer their enterprise B2B/B2C challenges.

"I come from a long line of entrepreneurs, as far back as I know. My great grandfather in the early 20th century, my grandfather, my dad. I started my first business when I was nine or 10 years old. I would buy candy and then sell it on my bike door to door. Later on I started some businesses focused web design and programming in the consumer friendly Internet world."

After college, Steele joined the army, where he would up as an army officer for five years, and which would ultimately lead him to form Kanga.

"I got some great experience, and I got my Masters degree in Operations Management. I was in change of several millions of budget, and I to facilitate cross country, and cross continent, shipping. It reinvigorated my passion for business," Steele said.

After leaving the military, he went to work fo an interactive marketing agency, which was his first exposure to the on demand world.

"I wrote software to better manage inventory and printing for that industry. Working at a consulting agency exposed me to a wide range of things, but I got burned out on that. I the hooked up with a guy who sold a company in Atlanta, and who wanted to invest in startups in Atlanta."

So Kanga was born, but the company initially started out looking different than it does now.

It launched with what Steele called an "Uber for delivery model," one that gave "anyone the ability to tap into the power of the crowd," before it decided to pivot and to become a B2B enterprise-focused company.

"We raised money, and our 1.0 beta version was released in late March of 2014, but we realized early into that process of building an app for the consumer, and peer to peer delivery, that we could also build a strong enterprise platform."

"Companies could connect with the vast network of local providers, individuals, ridesharing companies, and we could pair them with service providers to execute their deliveries."

The company has now been around for 26 months, and is "gaining good traction around the world."

How it works

Kanga's turnkey solution helps clients to better serve their customers' growing demands for same-day local delivery.

"Whether you’re a one off mom and pop bake shop, or a Fortune 100 global leader in consumer package goods, you struggle to set up logistics around getting things delivered at once, how to fill up trucks, and deliver things all day," said Steele.

The company dedicated to not only helping to pair up drivers and companies, but it also helping both sides save money and time with its GigPool SaaS tool, which allows gig economy employees to search for the gig jobs that work best for them, and apply automatically in one interface.

It allows drivers to maximize earnings for contractors by giving them multiple gig economy contracts, and helps gig economy companies by reducing their costs of partner acquisition.

For example, one customer is a cardboard box manufacturer in Atlanta, which, every morning, takes 10 to 15 trailer trucks worth of sheets of cardboard, and by the end of day has turned them into boxes that ship out.

"If they have unforeseen demand, like they run out of glue to hold the boxes together,  they could call a currier, or they could run to ACE hardware and have someone from the shop floor grab it, which would mean they'd have to pull someone off the machine. A common currier, they can get you anything today but it's very expensive. Also curriers can be a difficult, terrible experience. So they feel held hostage," Steele said.

"With Kanga they'd fire up their desktop or phone, send it out to the network of hundreds of drivers, and find who can do the job, and who has the right vehicle. We send the driver the job, they go and pick up the item, making it a better experience and price, with a rate of speed no one can match. We aggregate delivery sources, between individuals, crowdsourced ride sharing and third party services."

Drivers can join the Kanga Delivery Network via its iOS, Android, and web onboarding process, and can be checked for vehicle history, criminal background, and more depending on specific client requirements.

Kanga can also onboard other gig-economy company providers through our dynamic load balancing API. Current drivers range from individual contractors to existing courier and 3PL providers, to other crowd economy partners.

There are currently 5,000 drivers on the platform. Customers are allowed to rate drivers between one and five stars, as well as leave 140 character text ratings.

The delivery space

What separates Kanga from other similar companies in the delivery space is that it does not provide or employ any of the drivers.

"We are a SaaS tech company, and we connect anyone who needs delivery to companies out there doing delivery. We are a brokerage, like Priceline. We don’t execute deliveries, and we have no contract with personnel," said Steele.

"We don’t know if they’re having Uber or a crowdsourced driver. We don’t know, and we don’t care, we just give them best deal we can find them. Our user interface provides the experience they are growing to expect."

As for others in this space, like Uber, which has "unlimited resources," Steele said, but "at the end of day you are never going to have an Uber driver driving a flatbed truck, or a 25 foot cargo van. We have a network of people to help us to cover all grounds, even a palate of machine level parts."

Not having a direct relationship with the drivers also helps Kanga keep its margins low, to around 7.5 percent, while the other 92.5 percent is kept by the company, who pays then pays the driver.

While Kanga is still a relatively young company, it will be a on a $1 million a year run rate within the next couple of months.

The future of Kanga

The delivery space was ripe for disruption, Steele told me.

"As an industry, the way it's done is not great. There is no tech being leveraged. It's cumbersome and it doesn’t utilize advances in technology from the last 15 to 25 years. What we are really focusing on is reinvigorating a staid industry," he said. 

And he has some pretty big idea for where local logistics can go, specifically with standardizing the industry, creating a system where there are universal storage bins that can be dropped off, and then picked up, by other drivers.

"Standardization of shipping sizes is a concept I spend a lot of time thinking about. In the next 10 to 15 years one of the projects we’d like to have underway is a  standardized protocol for local delivery. The same way you hook any telephone to a line, we want to establish that for on-demand local delivery, so you can plug in and start generating revenue," said Steele.

"That means everything from the physical presentation of packaging, to standardization of data. Right now when Uber initiates delivery, passing proprietary info to their platform, standardization for that data transmission would benefit to others in the industry because, right now, no one has the ability to work well alongside each other. They can't crosstalk, so there won't be innovation."

(On stage: Everett Steele, Bambi Francisco, Wilson Sonsini's partner Rob Kornegay)


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