The digital truckload brokerage’s latest capital infusion indicates logistics investment won’t be slowing any time soon, as venture capital firms continue to back advanced online freight marketplace models.
The technology-oriented truckload brokerage Transfix on Wednesday landed a new funding round of $42 million, the company said.
The latest round, the New York-based company’s third such capital infusion, brings its total funding to more than $78 million.
Transfix is one of a handful of companies attempting to use modern backbone technology and intuitive user interfaces to unlock latent trucking capacity in North America. Others to emerge in recent years include Convoy and Loadsmart, as well as Uber Freight.
Transfix’s technology focuses on four primary areas: a marketplace for shippers and truckers to match loads; providing load visibility; providing analytics to shippers; and enabling carriers to get paid quicker and at a higher margin.
The funding round this week was led by New Enterprise Associates (NEA). Additional participants in the round include Canvas Ventures, Lerer Hippeau Ventures and other strategic investors. Transfix said it will use the funds to further develop its software platform and grow its technology and enterprise sales teams.
“Long haul trucking and logistics make up almost one percent of the U.S. economy,” said Scott Sandell, managing general partner, NEA. “Trucking as a job classification outnumbers any other in the country. At the same time, this industry remains incredibly fragmented and opaque, and has not yet enjoyed the benefits of technology and innovation like most other industries.”
“There is a lot of misinformation in the freight industry which creates pressure, impossible – and sometimes dangerous – deadlines, misdeliveries, and ultimately the failure to satisfy customers,” Transfix founder and Chief Executive Officer Drew McElroy said in a statement. “It’s a problem that’s ecosystem-wide, not just limited to a single part or parcel.”
The company said it has engaged with “many of the world’s largest retailers, consumer-packaged goods (CPG) brands and manufacturers to streamline and optimize full truck load shipment logistics.”
McElroy has long touted reduction of waste – predominantly empty miles traveled and the strain that puts on infrastructure and driver capacity – as the chief benefit of his platform.
He told the Wall Street Journal that the company expects to be profitable in 12 to 18 months. According to WSJ, the newest round of funding pegs the company’s valuation at between $225 million and $375 million.
Transfix snares $42 million in funding
