African merchants face a lot of challenges when it comes to international shipping from customs to hidden and excessive charges.

Digital freight forwarders are tackling supply chain issues. Flexport is an $8 billion company and a market leader in the freight space, and some have dubbed themselves the Flexport for Africa.

Topship, a recent YC graduate, raised a $2.5 million seed round months after finishing the winter semester. Flexport is the lead investor. Capital X, True Capital and Y Combinator are also backers. Immad Akhund, Mercury CEO, and Arash Ferdowsi, co-founder of Dropbox, are among the individual investors in the round.

Topship was founded in 2020 when co-founder and CEO Moses Enenwali noticed a surge in merchants needs for shipping parcels and cargo outside Nigeria. He had built relationships with these merchants after working with Sendbox. During his time with both companies, demand was steady, but it was different.

The world was shutting down, but there was high demand for stuff and demand for international shipping was going up at the same time. It wasn't a business then as we helped these people move stuff like a little hustle.

The majority of air cargo is flown in the belly hold of passenger flights, which is one reason why shipping air cargo is more straightforward to start than ocean cargo. It made sense for Enenwali to go through this route because passenger planes flew half empty for most of 2020. Junaid Babatunde was the CTO when Topship went live.

Topship wants to make it easier for African businesses to export and import parcels and cargo to their customers, suppliers, and distributors worldwide. The company wants to improve the shipping experience in Africa. Topship said in a statement that it wants to make the shipping experience in Africa as easy and stress-free as booking a ride on an app.

Flexport's model is super- heavy on ocean cargo movement, and CEO Enenwali doesn't think Africa is ready for it.

The Flexport model wouldn't work here because it's heavily invested in ocean freight and we don't have enough ports. In Nigeria, we only have one function port, and we need ports, railways, and roads for trucking. The CEO gave reasons why Topship doesn't involve itself with ocean cargo.

It is difficult to connect the continent with ocean freight. Flexport's business model makes sense even though they attack problems aggressively. We need to make it fit the use case in Africa. The way to connect the continent is via air. Every country and major city on the continent has a functioning airport, and airlines are flying to all of them daily.

Topship caters to a wide range of users. From a merchant moving tons of heavy equipment and a solo entrepreneur sending parcels to a student mailing documents to a school abroad, Topship is a borderline local and international shipping solution between digital freight and e- commerce fulfilment. Flexport backed several African companies from both categories, such as Trella, Flextock, Sendbox, and Freeterium.

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Merchants can move cargo and parcels from Nigeria to over 150 countries with Topship. Although it can help Nigerian merchants receive parcel deliveries from the other way round, they can only accept cargo deliveries from the U.S., the U.K and China.

The company takes a margin on transactions and sells shipping insurance. The company is looking at other revenue streams, including trade financing and customs clearance charges. The company's revenue has increased by 50% since January.

The CEO of Topship said that YC pushes them to dive as deep as possible in understanding their users. The ethos of the user is the most important piece of the puzzle, and we have to be obsessive about it. We are taking all the learnings and insights that we have learned from our users over the past five months or six months and building it into the product in a way that is merchants-focused.

Topship was invited to gauge the possibility of launching in their respective markets by merchant groups from Africa. This new funding will allow Topship to start operations there. He said that a portion of the investment would improve its asset-light technology and build out a proprietary global shipping infrastructure to make imports and exports significantly faster and easier.

Topship has set aside some money in fashion design and retail grants worth $3,500 each to award new and established fashion brands in Nigeria as a sign of support for the future of the growing e-commerce sector in the country.

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