Convoy, A Smart Logistics Service For Regional Trucking Businesses, Raises $2.5M
Dan Lewis wasn’t convinced that a startup that connects small trucking companies to people who need shipments was going to work. But he went door to door in a warehouse district in Seattle, and one problem kept coming up: smaller trucking businesses couldn’t grow because they weren’t able to connect with businesses that needed shipping without dozens of phone calls.
That’s where Convoy comes in, a startup that raised $2.5 million in venture financing from investors like Marc Benioff, Drew Houston and Bezos Expeditions, and is launching today. Convoy provides shippers with an online service that quickly gets them quotes for things they need to ship — like palettes of steel or other bulk shipments — based on certain variables, and connects them to companies with trucks in the area.
The goal is to basically help cut out brokers and the long, laggy chain of communication it requires to get in touch with companies that have trucks with space to make those shipments. It replaces that with a service that more seamlessly connects people who need to ship something with truck-driving companies.
“It takes a lot of human error out,” Lewis said. “Phone calls don’t scale, if you can get a service that accepts jobs and they can better manage their fleet, it makes their lives easier.”
Trucking companies get a mobile application that allows them to take those orders and quickly dispatch trucks in order to pick up those goods. When shippers enter the item that they want to ship, a price is immediately generated for them. Trucking companies can also, in theory, process more jobs because there is less downtime between orders thanks to the process being more seamless.
Lewis says that part of the reasoning behind the company was to help individuals who own small trucking businesses — like those with one or two trucks — get rid of a lot of logistical pain and grow to larger ones. The goal, he said, was to help those companies grow from one or two, to three or four, and continue to grow with the help of getting accurate price quotes and a simpler set of tools to handle setting up shipments.
When Lewis was younger, he worked in delivery in Seattle, and in college spent money building websites. And prior to starting Convoy, he worked as a consultant with transportation and technology companies — like airlines, he said, among other things. Convoy isn’t the only logistics-driven startup that’s been attracting a lot of attention. There are many other startups that have been able to attract interest in the technology community by improving outdated freight and shipping operations.
There are other startups in the area that are going after the logistics space, and it’s very likely that Convoy will face some stiff competition as it continues to grow — and as more logistics companies pay attention to the company. For the most part, Convoy’s competition comes from brokers that sit between shippers and trucking companies (which could always get their act together as well).
“With so many companies focusing on last mile in particular, you need some companies focused on the first mile, or middle mile, or second to last mile,” Lewis said. “So much energy [is spent] on last mile, we’re seeing it with startups and larger tech companies focusing energy on that, and there are gonna need to be a lot of innovation up the line. That’s why we were able to get a fantastic list of investors behind it. Distribution and logistics is really resonating. There’s a window right now in a pretty hot area.”
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