Saudi Logistics Platform OTO Secures $8M Funding for UAE and Turkey Expansion

RIYADH: The Saudi logistics platform OTO is poised to expand its operations into the UAE and Turkey following a successful Series A funding round, during which it raised SR30 million (approximately $8 million). This significant financial boost is expected to accelerate OTO’s growth and align with Saudi Arabia’s broader National Logistics Strategy, which aims to enhance the Kingdom’s global standing in the logistics sector by the end of the decade.

Details of the Funding Round

The Series A funding round was spearheaded by Sanabil Investments, a wholly-owned subsidiary of the Public Investment Fund (PIF), a major player in Saudi Arabia’s investment landscape. The funding round also saw contributions from Sadu Capital and Iliad Partners. Propeller and Soma Capital were additional participants in this investment deal. This recent funding follows an earlier raise of SR12.3 million, secured from various venture capital funds and angel investors, including Middle East Venture Partners, Derayah Ventures, and 500 Global.

Strategic Alignment with Vision 2030

The funding aligns with Saudi Arabia’s National Logistics Strategy, which aims to position the Kingdom among the top 10 countries globally in logistics performance by 2030. This initiative is a key component of Saudi Vision 2030, which seeks to diversify the Kingdom’s economy and enhance various sectors. Mohammad Al-Razaz, co-founder and CEO of OTO, emphasized that securing this funding is a significant milestone for the company, underscoring their commitment to revolutionizing the shipping and logistics sector in accordance with Saudi Vision 2030.

Platform Capabilities and Market Potential

OTO’s platform integrates with over 250 local and international shipping companies and e-commerce platforms. This integration allows merchants to manage, ship, track, and analyze their logistics activities effectively. Additionally, the platform provides options for merchants to either connect their own shipping contracts or purchase shipping labels at pre-negotiated rates, offering flexibility and cost-efficiency.

Investor confidence in OTO is reinforced by projections from Agility Logistics, which indicate that Saudi Arabia’s e-commerce revenue is expected to grow at an annual rate of 13.5 percent through 2027, exceeding the global average growth rate of 11.2 percent. With this funding, OTO plans to enhance its platform and expand its presence in Saudi Arabia, the UAE, and Turkey. The company aims to add new features and focus on small and medium-sized businesses and e-commerce merchants.

Turkish Market Insights

The Turkish e-commerce market is also expected to experience substantial growth. Projections indicate an annual growth rate of 11.58 percent from 2024 to 2029, with the market anticipated to reach $49.5 billion by 2029. This growth represents a significant opportunity for OTO as it plans to enter and establish a strong presence in the Turkish market.

Future Goals and Industry Impact

According to a spokesperson from Sanabil Investments, the recent funding underscores the growing need for intelligent shipping solutions in the logistics sector. OTO’s platform is designed with a comprehensive set of integrated functionalities to help companies of all sizes meet their logistics needs efficiently.

Currently, OTO serves over 10,000 local and international brands and has seen a notable increase in both revenue and orders processed year-over-year. Furkan Uzar, CTO and co-founder of OTO, highlighted that this funding will advance the company towards its vision of becoming the leading shipping gateway on the internet. By bridging the technology gap between sales channels and shipping providers, OTO aims to accelerate its growth and provide customers with streamlined, automated shipping solutions.

The successful completion of the Series A funding round represents a crucial step forward for OTO as it prepares to expand its operations into new markets. With plans to enhance its platform and strengthen its presence in the UAE and Turkey, OTO is well-positioned to drive innovation in the logistics industry and support the growth of small and medium-sized businesses across these regions. This expansion will not only boost the company’s growth but also contribute to Saudi Arabia’s broader goals outlined in Vision 2030.