Ziticity raises 2.2 million euros

Ziticity entered the Estonian market in the end of 2018 and has been in a fast-tracking growth phase since then, says Laimonas Noreika, the founder and CEO of Ziticity. "When COVID-19 lockdowns and restrictions hit retail and restaurant industries, business owners started to look for a logistics partner to help them with the delivery problem they were facing. Within the first few weeks after remote working was introduced, the number of registered merchants grew exponentially. Our service was a big help especially to those businesses who, until quarantine, had only physical stores. Ziticity was a solution that allowed them to offer affordable same-day delivery that traditional logistics companies lacked."

Founded in 2017, Ziticity empowers local businesses owners to compete with Amazon dominance by providing the platform for affordable same-day deliveries. With an on-demand solution, local e-shops and restaurants can optimize and distribute deliveries in real-time without usual distribution centres and paying high commission fees to shipping companies or food delivery platforms.

Since launch, Ziticity has been a success in France and the Baltics, used by over 2,700 companies. "We currently have about 320 merchants (in Estonia) onboarded on the platform and about 500 on the waiting list. Some of the biggest brands that use our service are Telia, Tele2, Pizza Hut, Euroapteek, Douglas etc," says Noreika. When it comes to couriers, startup has currently 1447 registered delivery people ready to fulfil clients’ requests.

Thanks to urban batching logic, the reached average delivery time is 37 minutes in Tallinn and couriers are able to complete 4-6 deliveries per hour. This keeps prices affordable to the shopper, while couriers are able to earn +15% more per hour than in competing platforms.

According to Ziticity’s data, 60% of last-mile deliveries are within a 5-kilometre radius from pickup to the drop-off location. Short delivery distances widen the possibility for couriers to use any mean of transportation including cars, bicycles, e-scooters, etc.

"Before Corona virus spread, Ziticity was an ideal startup getting ready for fundraising — every month we had 15-20% growth. Since January we were already talking to investors about the next seed round. When Corona, especially social distancing and remote working hit Europe, everyone turned to the delivery industry. Food delivery companies, eCommerce platforms were the lifesavers for people who had to stay and work from home. This was the time for Ziticity. Our numbers skyrocketed and investors were eager to invest in us. Initially, we planned to raise less capital but due to our good performance and potential uncertainty in the market, we scored more," says Noreika.

The round was led by NordicNinja VC (FIN) backed by JBIC, Honda, Omron and Panasonic in participation with Estonian VC fund Superangel, Superhero Capital VC (FIN) and Practica Capital (LT), to fund Ziticity’s expansion in Europe.

The investment is planned for expansion in more markets. "As an example, we just entered Paris. We will also use it to add more team members locally," says Noreika. "Actually, we are actively hiring for 12 roles right now."

The company has been steadily growing 22% month over month ever since the launch with a sharp 44% revenue increase during COVID-19.

“Local e-commerce cannot compete on product price with Amazon and Alibaba. To have a fighting chance with global tech giants that are building monopolies in e-commerce and restaurant delivery space, we have been able to build a direct service for local merchants to compete locally," says Laimonas Noreika, who built the company out of personal frustration for long delivery times.

“The delivery industry is expected to increase dramatically and 2.1 billion people are expected to buy goods online by 2021. On top of that, current global pandemic changes people’s behavior and habits like how they buy, sell and eat at an unprecedented rate of change. We believe that ZITICITY’s solution is a kind of silver lining approach for the industry and end-users which need to adjust for new normal,” says Tomosaku Sohara, Managing Partner at NordicNinja VC.

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