Digital freight matching (DFM) startup Loadsmart has lined up a $19 million investment from its venture capital backers and plans to launch a drayage initiative to improve the flow of freight through American ports.
The news comes just a month after Loadsmart teamed with San Francisco-based industrial automation provider Starsky Robotics to test a linkage between autonomous freight brokerage and self-driving trucks. Together, they demonstrated a program that can price, book, and load a shipment without any people in the loop, the firms said.
New York-based Loadsmart had previously raised $21.6 million in funding from the investment arm of shipping giant A.P. Moller-Maersk and other VC firms in 2018. The latest round includes money from previous investors Chromo Invest and Connor Capital SB, and also adds a new investor in Ports America, the largest terminal operator and stevedore in the U.S. Together, they bring the firm to $53.4 million in total backing.
Loadsmart says it now plans to use the capital to push its Smart Drayage initiative, which is intended to help participants rethink the flow of shipping containers through marine terminals and develop a free-flow model to accelerate the transit of goods through the largest ports in America.
"The free-flow model moves the industry from container-specific to container-agnostic. It means that truck drivers will be given the best container available when they arrive at the port, having pre-agreed with a specific mileage band trip," Loadsmart CEO and co-founder Ricardo Salgado said in a release. "As a result, we project that truck drivers will be able to reduce their time to get in and out of the port by at least 25%. At the same time, we estimate that port operators will be able to reduce container shuffles by at least 50%, which is a huge efficiency gain."
If that vision pans out, Loadsmart's investors stand to gain from the new approach. Maersk alone moves around 13 million containers a year, or around 15% of the world's container market. Ports America operates 33 port terminals in 22 cities in the U.S. and moves around 6.7 million containers in and out of the country.
"As the only tri-coastal terminal operator, we are focused on providing value to supply chains through transparent and efficient terminal operations and in our pursuit to provide our customers with best-in-class service, we need to rethink how goods are moved more efficiently," Mark Montgomery, the president and CEO of Ports America, said in a release. "Streamlining the drayage movement benefits our trucking community with faster turn times while providing cargo owners with better visibility and more efficient container retrievals."
The funding announcement comes together with the release of a new product called Loadsmart Drayage Instant Booking. The service is available via Loadsmart's website and enables small and medium-sized shippers to book a drayage truck in seconds. Loadsmart also offers an API integrated solution for enterprise accounts. "The addition of drayage to our established expertise in truckload services allows Loadsmart to provide integrated logistics services through technology. Our goal is to offer shippers of all sizes access to a fully integrated, seamless multi-modal end-to-end experience," Felipe Capella, Loadsmart's chief product officer and co-founder, said in a release.
The drayage sector has seen a flurry of activity from venture-backed software startups in recent months, led by entries including BookYourCargo.com, Dray Alliance, and DrayNow. Even larger sums of VC cash have been flowing to digital freight brokers in the long-haul trucking sector, supporting newcomers like Transfix, Uber Freight, Convoy, and Loadsmart itself.
We're thrilled to announce we've raised $19M from Ports America and Maersk to streamline how freight moves through America's ports.— Loadsmart (@LoadsmartUS) September 5, 2019
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