Why Sydney startup Shippit knocked back more than half of its $5 million series A offer

Australian logistics management software startup Shippit has secured $2.2 million in series A funding, with an eye on expanding into Asia.

The round was led by Aura Group, which started a venture capital fund in May last year with an aim to raise $30 million. Adventure Fund and RTL Group Investments also contributed.

Shippit was originally seeking $3 million but co-founder and executive officer Rob Hango-Zada said the business grew so well during the raise that in the end it didn’t need that much.

“Our subscriber base grew by over 40 per cent , with around a 200 per cent increase in monthly revenue. We’ve always been fiscally responsible, however when we reconsidered the amount that was required to fuel our next phase of growth, the figure was actually much closer to $2 million.”

Investors were keen to get on board as well, with the startup claiming that the series A was oversubscribed to a total of $5 million, meaning it ended up rejecting $2.8 million worth of potential investment.

“We received a humbling flurry of interest, however we didn’t think it would be wise to accept more capital than we actually required,” Hango-Zada said.

The startup, now heading into fourth year, says its software now facilitates shipping for more than 750 merchants in Australia, including big names such as Sephora and Topshop. Shippit made headlines last June for allowing Harvey Norman to pull off same-day and scheduled deliveries. Read more

Tony Yoo - Business Insider - 16 May 2017