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Convoy raises $62M from Bill Gates and other luminaries to transform trucking

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Re: Convoy raises $62M from Bill Gates and other luminaries to transform trucking

#31
Speaking as the son of a trucker who spent a summer helping my dad negotiate and optimize his freight rates and schedules, the freight brokerage business is not one I would consider getting into. There is also a ton of competition in the freight brokerage space and the problems associated with shipping are due to poor warehouse management and unreliable truck drivers.

Unlike hailing rides in a taxi, manufacturing and shipping generally holds a regular schedule. If you build a reputation as someone who always shows up on time, you can make a lot of money as a truck driver (more than most programmers). After building a good reputation you cut out the broker and work with the manufacturers directly. All you need to do is find two manufacturers in a high paying industry, (pharmaceuticals, chemicals, specialized plastics) whose pickup and dropoff points are near one another and you can be set for years.

Most poorly run warehouses can be backed up for 4-6 hours before you can begin unloading. Most standard contracts allow 2 hours from the point of arrival to fully unload your truck. We would negotiate our billing like a lawyer. For any additional time after that grace period we would charge in hourly blocks at over $100 per hour. Companies try to abuse their power by wasting the time of drivers by not paying them to sit idle at their warehouses. Amazon and Walmart are notorious for these practices.

I think there is a lot more money to be made using technology to run a high tech fleet of trucks than there is a freight brokerage company. Trucking is an information game for sure but there is too much competition in the freight brokerage space and you can be easily side stepped by savvy truckers.

Re: Convoy raises $62M from Bill Gates and other luminaries to transform trucking

#32
post #17

Walmart just lightly threatened carriers & owner operators that if they work for Amazon they can expect lower priority from Walmart in the future (1) Walmart presently represents ~14% of the total capacity of one of America's largest carriers - Swift transport - and likely similarly important elsewhere. (2) Obvious outcome down the road is that one of these behemoths snaps up a convoy / other plays in the space to se…

I do think Walmart is paying attention to this.

Re: Convoy raises $62M from Bill Gates and other luminaries to transform trucking

#33
post #31

Speaking as the son of a trucker who spent a summer helping my dad negotiate and optimize his freight rates and schedules, the freight brokerage business is not one I would consider getting into. There is also a ton of competition in the freight brokerage space and the problems associated with shipping are due to poor warehouse management and unreliable truck drivers. Unlike hailing rides in a taxi, manufacturing and…

I feel that for most companies playing in this space, freight brokering is just a transitional step. It can't work long-term, just like Uber can't be viable without self-driving cars.

However, it's the best way to understand how the industry operates - if you're serious about disrupting it.

Re: Convoy raises $62M from Bill Gates and other luminaries to transform trucking

#34
post #20

I used to work for startup called OpenMile in 2012. We were trying to do pretty much the exact same thing. We might have been too early, but it was hard. We had the tech, but the trucker and other brokers were not very tech savvy. The margins were low and there was too much hand holding. Best of luck to them.

How far did you get? Were you delivering shipments?

Re: Convoy raises $62M from Bill Gates and other luminaries to transform trucking

#35

"We don’t think there are any other companies that have taken the same approach" I distinctly remember a service/app with the same purpose in Europe in 2013. There's Cargomatic and mentioned by mkoryak, OpenMile. And probably others. Money will definitely help here, though.

Yep, we launched one:

https://cargofone.com/en/

Money helps, but it isn't the only thing.

Re: Convoy raises $62M from Bill Gates and other luminaries to transform trucking

#36
post #31

Speaking as the son of a trucker who spent a summer helping my dad negotiate and optimize his freight rates and schedules, the freight brokerage business is not one I would consider getting into. There is also a ton of competition in the freight brokerage space and the problems associated with shipping are due to poor warehouse management and unreliable truck drivers. Unlike hailing rides in a taxi, manufacturing and…

I was left asking, what is the real difference between Convoy and any other freight broker? The collect more data? I thought IBM was already in that business.

Re: Convoy raises $62M from Bill Gates and other luminaries to transform trucking

#37
post #17

Walmart just lightly threatened carriers & owner operators that if they work for Amazon they can expect lower priority from Walmart in the future (1) Walmart presently represents ~14% of the total capacity of one of America's largest carriers - Swift transport - and likely similarly important elsewhere. (2) Obvious outcome down the road is that one of these behemoths snaps up a convoy / other plays in the space to se…

Kind of tangential to the discussion here, but Walmart's threats are empty. Amazon is currently constrained by trucking capacity, and would gladly swallow up more.

I have said it before, and I think it applies here, Amazon is becoming Walmart far quicker than Walmart is becoming Amazon.

Re: Convoy raises $62M from Bill Gates and other luminaries to transform trucking

#38
>“Like I said, I would rather have [the brokers] go through all of the headaches than me. It’s bad enough what we are dealing with out here on the roads than to be worrying about that.”

This seems to imply that there is something traditional brokers do that Convoy is now putting on the driver. Does anyone know what that is?

Re: Convoy raises $62M from Bill Gates and other luminaries to transform trucking

#39
post #35

"We don’t think there are any other companies that have taken the same approach" I distinctly remember a service/app with the same purpose in Europe in 2013. There's Cargomatic and mentioned by mkoryak, OpenMile. And probably others. Money will definitely help here, though.

Yep, we launched one: https://cargofone.com/en/ Money helps, but it isn't the only thing.

Can I pick your brain? Sooo grateful I will be... email in profile
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