When the Inc. 5000 list of the fastest-growing companies in the United States was released earlier this week, transportation and logistics watchers should have been pleased, but not surprised, to see FreightWise near the top of the list at the number two spot.
FreightWise, a software and services startup headquartered near Nashville, Tennessee, was formally founded in 2014 by chief executive officer Chris Cochran and vice president of sales Alex Rustioni, but began development in 2015 and started generating revenue in 2016. According to the Inc. 5000, FreightWise grew revenues over the course of three years at a staggering rate of 30,548 percent and recorded 2018 revenues of $33.6 million.
Earlier, Cochran and Rustioni had founded TracBack Solutions, which provided auditing services for parcel shipments. They sold TracBack to AFS Logistics in 2003, and eventually used some of that payout to bootstrap FreightWise.
FreightWise is a transportation management software platform that started with parcel and less-than-truckload (LTL), but will eventually expand into truckload and other transportation modes. What differentiates FreightWise from other logistics service providers (LSPs) is that it owns all of its intellectual property in-house – “we’re a code-based shop,” in the words of chief executive officer Chris Cochran.
Cochran said that FreightWise fills the gap between transportation management systems and accounting systems, which often have differing reckonings of cost, and seeks to provide an overall better user experience. Offering transportation management services and immediately reducing clients’ freight spend has allowed FreightWise to enjoy a shorter sales cycle than traditional enterprise software companies. The managed transportation aspect of the business, Cochran said, let clients account for FreightWise as an operational expense rather than a capital expense, which speeds time-to-decision and lets the company shortcut longer procurement and legal compliance cycles.
“We’re very much a SaaS [software-as-a-solution] and software company, but you have to have services around freight,” Cochran said. “We do have the roles of an LSP – we have mode experts in parcel and LTL and auditors that know pricing details down to tariff level. We are doing statistical analysis and traffic studies, and helping with carrier selection when clients buy the freight on our program.”
Cochran spent five years at Oracle prior to co-founding FreightWise and was involved in the acquisition that resulted in Oracle Transportation Management. Founding FreightWise, he brought a deep understanding of enterprise resource planning software, as well as the need for any new technology company to think about integration first.
Building, running and exiting TracBack taught Cochran a lot about the software business and helped give him the confidence to bootstrap the company instead of raising outside capital.
“We learned a lot and made plenty of mistakes,” Cochran said. “We had a little bit of funding from the sale, and we were somewhat familiar with growing a business from that venture – all the ins and outs and the reality of how we could go to market. We thought that if we could get it built, we could generate some revenue. We had an upfront plan and diligence to roll the money back into the company and put the margin back into employees and software and new projects.”
FreightWise gained permission to release the names of three of its customers – Facebook, Great Plains Manufacturing (a Kansas-based division of Kubota) and American Cast Iron Pipe Company, based in Birmingham, Alabama.
“We’re making a big push on being multi-mode, and the maturation phase of our lifecycle will be multi-mode,” Cochran said. “We started with LTL and quickly went to parcel because we have deep expertise in both. We have spot market technology as of about a year ago, which allows us to do hot shot, truckload and expedited.”
The culture at FreightWise, Cochran said, is high-energy and performance-based, with metrics set for every division of the company. FreightWise recently hired its 50th employee. The company has already moved twice and is about to move again; it’s looking for a space of about 10,000 square feet.
“In a way, it’s surreal that we’ve accomplished this level of growth, but in many cases it is intentional and we are pushing everyone to run this fast and get it done,” Cochran said.