Businesses are often faced with the need to deliver their goods in a short time, but transport might not be available at the right time. GroozGo is a popular online B2B service that links customers who need to transport cargo with available carriers. The idea was developed by Anna Kachurets, a graduate of MGIMO (Moscow State Institute of International Relations) economics department, who worked as analyst at Rusnano (Russian Corporation of Nanotechnologies).
Deciding to launch the project in 2015, Anna needed to find a business partner who would know the ropes in the transport industry. So she partnered with Oksana Pogodayeva, a graduate of the Higher School of Economics (in Moscow) with four years of experience in logistics and supply chain management. The two young women held a brainstorm and began to build a financial model of the future company.
Their knowledge and persistence led to the launch of GroozGo in 2016. After two years, the online service had 3,000 registered carriers and 800 cargo owners.
This is how GroozGo works: the consignor of the goods registers on the website and signs a contract with the company for the provision of TEU; GroozGo contracts carriers for the service. After the client has registered and made an application, the system instantly calculates the cost of transportation; the closest suitable carrier responds, and the consignor receives a contract-application with the driver’s and vehicle’s details by email with the online service stamp. On the day of shipment, the client receives a real time tracking link and pays for the transportation only after the goods are delivered to the specified address. The carrier receives the money 10 days after the submitting the confirmation to GroozGo.
GroozGo carrier database includes 45% of sole business proprietors with 1-5 trucks, 40% transport companies, and the rest are retailers and companies with their own fleet that take goods on backhaul.
GroozGo’s road to success was difficult; several times, partners were about to declare bankruptcy, and had to change their business model to survive. A smooth work of the service required a properly developed online platform. To hire programmers, the young women had to spend their salaries.
In 2016, businessman Anton Starsky saved GroozGo by purchasing a 9% share in the company for RUR 2.5 mio ($38,000). Anna and Oksana left their second jobs and focused their efforts on developing the service.
By early 2017, the business owners had spent the investor’s finances for improving the online platform as well as advertising, organizing the coworking space, and paying the salary to a hired employee.
In the spring of 2017, Anna and Oksana received a call from the logistic operator KPD, which offered investments in the online project. Private investors, who also were the operator’s owners, made a decision to purchase GroozGo as they had started developing a platform for their needs and decided to join efforts. The total investments stand at RUR 120 mio ($1.8 mio).
KPD’s investments came as a ‘lifesaver’ that allowed solving the problem of time-consuming payments and increasing expenses for advertising transportation services. Within 12 months, the number of transportation carriers involved in executing orders increased from 300 to 2,000, and the number of clients grew from 150 to 680.
GroozGo is a popular online service that selects the closest most suitable transportation carrier. The service finds a carrier vehicle within 15 minutes, with the transportation cost reduced by 20%. The order is made online, without any calls; the service is safe (one agreement, no mediators, monitoring cargo movements via a personal account) and reliable (online payment, trusted carriers, and comprehensive insurance).