One of America’s enduring folk heroes is the trucker, a heroic and solitary entrepreneur plying the highways and byways, braving weather and fatigue to make deliveries.
In reality, that truck driver is often a struggling small business owner, driving an empty truck nearly half the time, fighting to find business and figuring out the most economical route to the next destination.
Trucking is a huge business, generating $260 billion in revenue in the U.S., 20% of a global total of $1.2 trillion, according to McKinsey & Co. Trucks deliver two-thirds of all products shipped each year, but the business is highly fragmented, with the average U.S. trucking company owning three trucks or less. The process of getting a package from factory to distributor to customer can be fiendishly complicated, involving up to a dozen companies and a bewildering mixture of paper and digital documents.
Inefficiency attracts technology, so entrepreneurs and investors have leaped into the market with technology-driven solutions.
“Trucking is the background noise of America,” said Dan Lewis, CEO and co-founder of Seattle-based Convoy, No. 11 on CNBC’s 2019 Disruptor 50 list. “Companies like Unilever and Starbucks are moving thousands of shipments every day.”
Convoy offers apps that help match trucks and shipments. It enables drivers to bid automatically for loads, submit their bills and get paid quickly. Shippers can post a job, get real-time quotes and track their shipments.
“We’re trying to help trucking companies and truck drivers run their businesses more efficiently,” says Lewis.
Lewis says Convoy’s timing was fortunate. When the company launched its app in 2015, smartphones were just gaining widespread use among truck drivers. He and co-founder Grant Goodale are both former employees of Amazon, where they had a close-up involvement with a massive logistical task. But Lewis says he developed an interest in the transportation process much earlier, while making deliveries around the state of Washington for his grandfather’s office-supply business. “It gave me some appreciation of moving things around.”
In less than five years, Convoy has grown to 500 employees, raised $265 million and reached a valuation of more than $1 billion. Investors include Alphabet’s late-stage venture arm CapitalG, Amazon founder Jeff Bezos and venture capital firm Greylock Partners.
“Convoy’s mission starts with getting to a world with zero waste, addressing the 40% of miles driven without a load,” said Reid Hoffman, a partner at Greylock and co-founder of LinkedIn. “We believe in that mission and bet on a team with deep logistics expertise who are dedicated to improving the industry.”
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