Another Seattle startup is blending technology with logistics to change the way goods move around the country within a $800 billion U.S. trucking industry.
This time it’s Freightweb, a new company founded in September that today announced a $3 million seed round led by Madrona Venture Group and 8VC.
Freightweb has developed a “Partial Truckload” transportation service that helps customers move partial truckloads of freight.
Traditional services cater to shippers moving either a small handful of pallets — “Less Than Truckload (LTL)” — or an entire truck’s worth, also known as “Full Truckload (FTL).”
Freightweb wants to help everyone in between — those that have half a truckload but don’t want to pay for an entire truck or spend hours trying to find a potential match.
Will Payson is familiar with this problem. Payson, CEO of Freightweb, is a 14-year veteran of FedEx, where he helped turn FedEx Freight into a juggernaut. He joined Amazon in 2016 and spent three years scaling the retail giant’s growing on-road delivery network that now rivals FedEx and UPS.
His co-founder, Marty Sinicrope, is another logistics expert who ran GlobalTranz for nearly five years as president. Rounding out the founding team is Farah Ali, who was director of engineering for eBay’s shipping science team and most recently a vice president of engineering at Electronic Arts.
Three-fourths of trailers on the road in the U.S. are less than half full by weight, according to the Department of Transportation. That’s a lot of wasted money and time, Payson said, not to mention the environmental repercussions.
“One thing comes loud and clear from our customers: They found it really hard to find good solutions in the Partial Truckload space,” Payson said. “Existing players haven’t met their needs and provided it in a way customers want.”
Freightweb’s online portal offers instant rate quotes and booking. The company says it can save shippers an average of 25 percent over Full Truckload-based pricing.
The startup is building out a network of “owner-operator” drivers that run their own trucking businesses across Southern California, Arizona, and Texas. It also has a patent-pending pallet loading system that “helps us bend the curve on Partial Truckload,” Payson said.
Early customers include small retailers looking to move their goods, including some that drop off shipments at Amazon warehouses. “We’ve come full circle,” said Payson, the former Amazon exec. Brokers also use Freightweb to find immediate Partial Truckload solutions.
Here’s how Scott Jacobson, managing director at Madrona, explained why he’s excited about Freightweb:
“This problem is worth solving for all of the players in the freight-hauling ecosystem. For shippers, buying freight in chunks of any size means they no longer need to optimize their shipping to conform to the restrictions imposed by the current system. They can buy smaller chunks of trucking capacity more cheaply while moving freight more frequently, shifting the balance from batch to continuous flow to better adapt to market demand. For carriers, they can better fill their trucks with freight from multiple shippers, increasing capacity utilization and total revenue. Innovations that enable the parties on both sides of a transaction to benefit financially are hard to find, and that’s one of a number of things that make the FreightWeb opportunity compelling.”
Freightweb is based in Seattle and has another office in Scottsdale, Ariz. The company has around 20 employees.
Payson said Freightweb is not competitive with Convoy, the Seattle-based digital freight brokerage that raised a $400 million investment round in November.
“If they have a customer needing to move a half a truckload of freight and we’re the best solution for it, we’d be happy to be a carrier to Convoy,” he said. “Frankly, our interest is in moving partial truckloads of freight.”
“It’s really amazing how much activity there is in the Seattle area around logistics technology,” said Payson, who moved to Seattle for the Amazon Logistics gig in 2016.