Founded in 2011 by Pekka Ylenius and Timo Toivonen, OGOship is a tech-oriented logistics company that claims to offer a hassle-free logistic solution for e-commerce businesses.
The Helsinki-based startup recently announced that it has raised €4M in its pre-Series A round of funding. The round was led by Flashpoint Venture Capital and Innovestor Ventures, with an earlier backer Maki.vc also joining. The company raised its €1.5M Seed funding in 2020.
Since its launch in 2011, the OGOship has developed a platform that offers a fast-to-market solution that enables SMEs to scale to new markets in a sustainable and easily accessible way. In terms of sustainability, the company supports industry change and policies by ensuring no plastic packaging, no diversions, always choosing the shortest route, fast shipments, and no flights.
The company’s client base includes customers from Europe and the US consisting of small and medium-sized direct-to-consumer brands or e-commerce shops. OGOship has also partnered with DPD, DHL, Budbee, and other courier services. Currently, it has over 50 employees across 5 countries and offers 7 logistical hubs across Europe.
For our first ‘Founder in Focus’ interview series, we have chosen to focus on Timo Toivonen, co-founder of OGOship, in order to understand his drive and passion towards OGOship, and how he has managed to steer OGOship away from choppy waters and set for smooth sailing.
Here are the edited excerpts:
SC: How would you describe yourself as an entrepreneur? What was the inspiration or Eureka moment for creating OGOship?
Toivonen: I used to be a do-it-yourself kind of person and over the course of new hires, it has been difficult in letting go of tasks. Also because I am super motivated to my company and my work, it adds to the difficulty in letting go of things.
The inspiration for the creation of OGOship was when I first visited a 3PL warehouse and saw how rigid all looked and how unsuitable the operations were for an e-commerce company. I was then also opening a small ecommerce business myself and that is why I went looking for 3PL. I realised that the bigger opportunity lies actually in 3PL.
SC: What were some of the initial challenges that you faced while setting up OGOship?
At first, I did not know anything about entrepreneurship or software development in general. I also did not have a co-founder in the beginning. Realising that I needed a co-founder came perhaps 6-12 months after trying to get started on my own.
SC: What was it like to hire your first team member?
Toivonen: It was very exciting. Also exciting because I had not had experience with hiring people earlier. Then I just started discovering what other people can do and how we might work together. I probably did many mistakes also when onboarding this person, who really jumped aboard a ship barely floating.
SC: What was your first office like? How has your office evolved over the years?
Toivonen: The first office was a home office, but the first real office was a small room at an office hotel. It was just a small room and fitting even two people there was difficult. We actually did not really even spend time there but were just in the general lobby area. But that was all we could afford. We have moved our head office 4 times since then, always to a slightly bigger office. Now we finally got our own office, not at an office hotel. We have 10x more space than one year before, places we can work solitary, have meetings, social events etc. It is just great!
SC: Please tell us about your Aemdee journey.
Toivonen: Aemdee was one of the projects that I started back when OGOship was also started as a side business, part-time really. Aemdee was founded when I participated in the Founder institute’s Founder program and we did develop a nice little piece of software then. But the idea did not fly, unfortunately. Many good learnings I had though!
SC: You recently raised €4M. Do you plan to raise more considering the favourable fundraising environment?
Toivonen: Yes, most definitely. The market is booming currently both in funding and also the logistics industry is undergoing a big change. We are preparing for the next round already.
SC: Was it difficult to seek VC investment for your company? What were some of the key challenges you faced while seeking your first investment?
Toivonen: I don’t think it was difficult. The difficulties lay mostly in the KPI / financial part of our business. We were not very familiar with the important VC KPIs and we had to come up with financial analytics very quickly to close the 1st deal. We have learned a lot since!
SC: What is your long-term vision for your company?
Toivonen: I believe that e-commerce is going to grow and that is good overall for people and societies. However, I also believe that there are some problems in the current model: not all companies can join in because there are economies of scale in the logistics part especially. And also the way e-commerce is currently done is not as environmentally friendly as it could be. We want to enable all companies to be able to participate in the global marketplace in a sustainable way, both economically and environmentally. OGOship is aggregating existing fulfillment centres together and creating an e-fulfillment network to make e-commerce smarter, finding savings in costs and environmental impacts. We have a global opportunity to make this happen and that is my vision for the company. With our platform business model, we are not restricted by geographical boundaries and we can truly make OGOship work everywhere.
SC: When would you consider your company to be a success?
Toivonen: When I have achieved the above! =) Ok but honestly, when I see and hear from our customers that we are the key partner who has enabled their growth journey, that is when we have succeeded. When I see customers coming from other continents and using OGOship’s services to enable the sale of their superb product, that is when we have succeeded. And when we can clearly see the reductions in environmental impacts from e-commerce, enabled by OGOship, that is when we have succeeded.
SC: What would you advise your younger self? Are there things that you would do differently if given a chance?
Toivonen: I started OGOship as a side project and started giving it full focus much after the founding of the actual company. My global perspective for the business grew over the early years and the 1st real push for international expansion started after the 1st angel round in 2017. Seeking funding earlier and starting the expansion push earlier is something I should have done a few years before I actually started. Therefore, I would advise my early self to get a global perspective sooner and think big sooner, right from the start if possible. Get funding sooner, get a team together faster, start growing faster.