Digital freight brokerage startup Convoy aims to shake up America’s $800 billion transportation industry by creating a platform that brings together freighters and truckers. Convoy in July 2017 The Series B investment round led by Y Combinator raised $62 million and includes: Jeff Bezos, Bill Gates, eBay founder Pierre Omidyar, KKR CEO Henry Kravis, Reid Hoffman and Expedia CEO Barry Diller. This investment makes Convoy the largest investment-backed transportation technology startup in America.
A Load Platform:
Transportation is a huge industry, but it is very fragmented. Loaders include companies of varying capacities, from Fortune 100 companies to small-scale retailers. On the other hand, there are approximately 586,000 independent, employable truckers in the United States.
Freight brokers control this chaos by connecting a shipper with goods to be transported and a carrier capable of carrying that load. Among the major brokers , CH Robinson Worldwide and XPO Logistics are companies that make billions of dollars a year, but still use legacy business models that include telephone communications and paper document transactions.
On the other hand, Convoy creates a platform that brings together loaders and carriers through its website and mobile application. Convoy creates value for freight bearers by providing value-added services such as fast pricing, reliable booking with its large freight carrier pool, information transparency in freight movement, and supply chain optimization through data-driven analytics. For freight carriers, it provides opportunities such as instant cargo reservation via mobile application, 24/7 support for assistance with problems encountered during shipment, and free electronic payment within 48 hours instead of payment completed in 30 days with old brokers.
As can be seen clearly, the Convoy model aims to create a platform where communication between the two parties is high. It is expected that those who give more loads and those who carry more loads on the platform will affect each other bidirectionally. Convoy aims to quickly scale this network communication and defeat the legacy broker system in the near future.
Source: Digital Initiative