Third party logistics provider (3PL) ShipBob today landed a huge $200 million venture capital round, positioning its cloud-based e-commerce platform for fast growth and making it the latest logistics startup to reach the $1 billion “unicorn” valuation.
The seven-year-old firm said its “series E” funding round was led by Bain Capital Ventures, with additional participation from prior investors including SoftBank, Menlo Ventures, Hyde Park Venture Partners, Hyde Park Angels, and Silicon Valley Bank.
It follows a funding round of $68 million in 2020, which prompted the Chicago-based company to expand its fulfillment center network from 10 to 24 facilities, including its first facilities in both the U.K. and Australia. ShipBob now expects to open 10 more facilities across North America and Europe in 2021.
While the firm’s new funding was large, it was at least the third venture backing of comparable size for logistics startups this month alone, following rounds of $240 million for the German digitized freight forwarding provider Forto GmbH and $190 million for fleet management technology provider KeepTruckin. Both those firms also crossed the vaunted $1 billion valuation barrier, joining previous supply chain unicorns such as the delivery and fulfillment cloud platform provider Bringg, autonomous mobile robot (AMR) vendor Locus Robotics, and self-driving truck technology provider Plus.
ShipBob says it enables small and mid-sized e-commerce merchants to provide fast and affordable shipping to their customers without having to handle fulfillment themselves. Those merchants can also add services like returns management, inventory management, and financing tools.
The firm provides those services through integrations with e-commerce platforms and marketplaces including Amazon, Walmart, Shopify, BigCommerce, WooCommerce, Wix, Square, and Squarespace. To handle all that business, ShipBob uses a “purpose-built fulfillment technology stack” including its own warehouse management system (WMS). By deploying that WMS to all of its fulfillment centers, the company says it has shortened the time required to stand up new facilities to weeks instead of quarters.
"All of the facilities in the ShipBob network look the same, operate the same way and leverage the same world-class, cloud-based technology, which makes our merchant experience very consistent even as inventory is distributed across the globe,” Divey Gulati, ShipBob’s president and co-founder, said in a release. "With the additional investment from Bain Capital Ventures and our Series E, we can continue to make strategic, long-term investments in our product and technology to help make e-commerce businesses more successful."
According to lead financial backer Bain Capital Ventures, that decision to build a “full stack” of its own technology has been key to ShipBob’s approach. Other startups in the sector took a different approach, layering a “thin layer of digitization on top of traditional warehouse networks,” but ShipBob built from-scratch software for every key component in a cloud fulfillment service: warehouse management, fulfillment execution, inventory management, replenishment, network optimization, and shipping integrations.
“This product footprint requires a massive engineering investment, but the payoff for our merchants is an end-to-end system that can be scaled infinitely and efficiently, anywhere in the world,” Ajay Agarwal, partner at Bain Capital Ventures and a member of ShipBob's board of directors since June 2017, said in a blog post.