A Louisville-based logistics startup that launched just before the start of the coronavirus pandemic is raising capital as it looks to add automation to its processes.
eJOOV Inc., a customized e-commerce fulfillment company, has secured $936,200 on a convertible note and will seek a total of $3.5 million on its path to a Series A fundraising round. The effort comes just months after the company added 30,000 square feet of space to its now 100,000-square-foot facility at 6710 Grade Lane earlier this year.
In an interview Tuesday, eJOOV co-founder and CEO Eric Williams told me the company will likely fundraise throughout the entirety of the next calendar year, with the assistance of Dan Huckestein, managing partner at Impact Acquisition. Prior to this raise, eJOOV started with one angel investor and has since added a handful of local investors to its roster, although Williams declined to name any for this story.
The company intends to use the funds to introduce some "cutting-edge" automation to the building to reduce its reliance on labor amid the challenging labor environment, Williams said. eJOOV also plans to invest in expanding its software engineering team to offer more digital solutions to its clients.
"We've been able to expand our customer base," Williams said, without identifying those clients. "Not only are we doing custom e-commerce fulfillment for a number of customers — including apparel, entertainment and monthly subscription — but we're also growing our returns and playing in the middle-mile market. That's where we're really poised to take off."
In the supply chain, middle-mile delivery is the process that takes goods from warehouses and distribution centers to storefronts or smaller fulfillment facilities. It's a cost-cutting trend that emerged with the rise of e-commerce and has only accelerated with retailers over the course of the pandemic.
According to a recent forecast from eMarketer, U.S. e-commerce sales are on track to exceed $1 trillion for the first time in 2022 after spiking more than 30% between 2019 and 2020. While that growth rate dipped slightly this year, it is expected to maintain those levels next year.
Williams said eJOOV has partnered with aftermarket carriers that will rival DHL, UPS and FedEx. The startup is providing middle-mile sortation and custom software for those carriers to track and manifest packages.
eJOOV currently has 10 full-time employees, but has had extra contract workers during the busy fourth quarter. Williams anticipates the company will double its staff in the first quarter of 2022 before doubling that number again for 40 total full-time employees by the end of the year. In addition to Williams, the other four partners in the business include Chief Operating Officer Brendan Manion, Chief Technology Officer Tim Brown and Chief Strategy Officer Mike Lewis.
From the outside, eJOOV can appear like an overnight success, but the journey hasn't been without its bumps and bruises, Williams said.
"I like to joke around and say: 'Yes, we had this crystal ball that said we were going to have the bright idea to start this business right before the pandemic,'" he said. "But it's turned out pretty well for us because it's the right sector to be in.
"Obviously, we have a good idea that people are receptive to, and we're passionate about it and work very hard to make it a reality. But there's been plenty of challenges and believe me, the bald spot on the back of my head is getting bigger and the hair around it is getting whiter."
