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Originally published on 03/18/2002
When I got the Ensenda pitch, I thought that maybe the email had been stuck in a router since 1999: the company is a venture-funded local delivery business.
Fast Facts:
Ensenda
www.ensenda.com |
| CEO |
Christian Mannella. Last job: VP of marketing, Webvan. |
| HQ |
San Francisco, CA |
| Employees |
20 |
| Market |
Delivery |
| Funding |
$3M; lead investor Alloy Ventures |
| Profitable |
No; projected by Q3 2003 |
| Runway |
Six months of funds remaining |
In fact, in 1999 Ensenda CEO Christian Mannella was at Webvan -- but let's not hold that against him. Where better to learn how not to run a delivery company?
The difference between Ensenda and other shipping companies is that it has no inventory (unlike Webvan and Kozmo) and also no delivery vehicles (unlike FedEx). Ensenda is a service aggregator. It sets up relationships with local car- and truck-based courier companies, and resells their services to its customers. Ensenda is targeting nationwide retailers, who otherwise have to set up individual relationships at each location for same-day delivery. Ensenda charges its customers a pre-negotiated rate for all deliveries and hopes to strike volume pricing deals with couriers on the other side.
Ensenda could work; it is arguably easier for a company, like a Circuit City, to set up a giant corporate shipping account than to set up individual shipper relationships at each store. More importantly, many national retailers already have distributed inventory. The hub-based system of FedEx or UPS, while efficient for long-distance overnight delivery, does not work for immediate shipping and is wasteful for products that start out a few miles from their buyers.
But Ensenda has several challenges. First, it has to manage a large network of courier companies. Second, it must win large accounts by lowering their costs and management headaches. Finally, it's got to block competitors; as a purely information-based business, Ensenda has no expensive infrastructure as a barrier to entry.
Still, Ensenda is a good post-bubble Internet company: it is clever and low-impact, and it might bring efficiency to existing businesses, rather than angling to replace them.
- Rafe Needleman
email: rafe-needleman@catchoday.com
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