- Acting CEO Joe Chen: “We were a bit too aggressive” and “burned too much money.”
- Seeking financial sustainability, Trucker Path converts free load board customers to paying.
- New app features include fuel, truck route optimization and predictive analytics.
Back in 2015, the popular trucker app Trucker Path became one of the first in the trucking technology space to raise a Series A with a $100 million-plus valuation.
The company, which uses crowdsourced data to help drivers navigate, find parking spaces and check weigh station status, among other services, saw early success, attracting hundreds of thousands of drivers to its network.
Later on, however, the platform struggled, failing to generate cash flow, even after Chinese social media site Renren acquired the company in 2017. Renren led Trucker Path’s $1.5 million seed round in 2014 and participated in the $20 million Series A.
A new strategy: Fee for service
In an interview with FreightWaves, Trucker Path acting CEO Joe Chen assessed the company’s more recent financial challenges, saying in the past couple of years it had been” too aggressive” and “burned too much money.”
But the outlook is improving, he said, as Trucker Path “is starting to do a much better job turning free customers into paying customers.” With the driver app marketplace getting more crowded and sophisticated, Trucker Path also is joining the AI revolution, adding predictive analytics services to its crowdsourced offerings.
The company has been profitable since June, Chen said, and generated $3 million in revenue last year, a relatively small take, especially compared to revenues from such big digital brokerages as Uber Freight and Convoy. By unlocking the power of smart tech and its sizable user base, however, Trucker Path is aiming for less small, more mighty.
1 million users and backing from Softbank
After selling the social media platform in 2018, Chen restructured Renren as an incubator fund in the technology and SaaS space. One of the fund’s portfolio companies, Trucker Path is owned primarily by two investors, the Japanese conglomerate Softbank and Chen, also the CEO of Renren.
The company today claims 50 employees, with offices spread over three locations globally. Its Phoenix office hosts executive management; Beijing targets R&D and Manila customer service.
The navigation tool attracts around 1 million active users, according to Chen, a former truck driver. It also offers a load board, Truckloads, one of the most downloaded in the industry, according to a 2018 report from investment bank UBS.
From a market position, Trucker Path is “right up there — at the top, or near the top,” said Ron Scalzo, senior managing director of FTI Consulting.
Since launching in 2013, the company has evolved into a “one-stop app” serving carriers and brokers as well as drivers, Scalzo said. “They’re working both sides of the coin.”
App downloads vs. commercial success
Whether Trucker Path’s all-things-for-all people approach stalled its path to financial sustainability is unclear. Since the company is privately held, getting a handle on its finances is difficult, apart from the limited information shared by Chen.
Some details can be gleaned from the UBS report, which found Truckloads realized the largest share of downloads in 2016 and 2017 and the second largest in 2018.
However, the report stated, app downloads don’t necessarily correlate to commercial success, and it singled out Trucker Path in particular. “Within the app analysis, one name stands out as showing remarkable traction in terms of downloads,” the authors wrote, “but an apparent lack of commercial success based on our conversations with multiple companies in the brokerage industry.”
Seeking to reverse that trajectory, Trucker Path this year began charging for the load board. The company also introduced a premium version of the driver app, with two pricing tiers and services intended to add value to the core products.
“Initially we worried we would lose some members, but the user base increased,” said Chen, referring to the load board charge. And drivers still can access a free version of the app, which is supported by advertising.
Predictive analytics, full speed ahead
Steve Lopez, Trucker Path’s director of operations, described some of the premium navigation services. A new fuel optimization routing feature shows drivers the best route as a function of grade. A truck optimization feature allows drivers to input details of their truck, trailer, size and weight, yielding the best route for that vehicle.
As far as the crowdsourcing data, Trucker Path is introducing AI predictive capabilities, “so when planning your route you can also look at who is going to have parking space available when you get there,” Lopez said.
A similar approach is deployed for weigh station access, he said.
Adding AI is seemingly a smart way to retain driver interest at a time when the trucker app market has become increasingly sophisticated.
The Smart Trucking site, which caters to drivers, rated Trucker Path the “best all in one trucker app 2020,” but qualified the honorific by saying “some reviews of truck stops on the app can be misleading.
“Also, the navigation on Trucker Path is not that advanced compared to specialized GPS.”
Trucker Path, the humble brag
Referring to Trucker Path alternately as “tiny” and, in a reference to the load board, “one of the most underestimated companies in that space,” Chen is at once deprecating and bullish about the company’s current market position.
He lamented the loadboard’s “generic name”: Truckloads.
“Nobody remembers it,” he said.
But he described the digital brokerage and load board market in terms of “7-pound gorillas dominated by big 800-pound gorillas.
“It may sound a bit boastful, but we are the 700-pound gorilla,” he said.
The Softbank factor
Responding to a question about SoftBank funding, Chen and Lopez said the huge losses incurred by the Japanese company’s Vision Fund this year are unrelated to the financial challenges facing Trucker Path.
“They have not pulled out; they are still with us,” Lopez said.
Added Chen, “Softbank is a very good partner, and they take a very hands-off approach. Given our small size, they leave that entirely to the management.”
Trucker Path has increased headcount each year for the past three years, according to Chen, and in 2021 plans to increase at a more rapid rate and “grow a few multiples” as it continues converting free customers into paying customers.
Alluding vaguely to the company’s missteps, he doubled down on his statement that Trucker Path had been too aggressive, launching too many initiatives. “Now we are very efficient.”
“That’s what startups do. They dial up, they dial down. It’s the nature of the business.”