Unicorn Flexport is revolutionizing the world of logistics, acting as a forwarder with software that allows customers to manage their shipments. But there are still thousands of small shippers, many of them using outdated ERP or spreadsheet software. A startup called GoFreight wants to help them compete by providing the “Shopify of Freight Shipping,” with back-end software that makes their operations smoother, and a front-end that allows them to showcase and quote in seconds. minutes.
The Los Angeles and Taipei-based startup has raised $23 million in Series A funding, co-led by Flex Capital and Headline. The round saw participation from LFX Venture Partners, Palm Drive Capital and returning investors Mucker Capital, Cornerstone Ventures and Red Building Capital.
GoFreight, which currently has around 1,000 customers, helps manage the transportation of goods across sea, air and land routes. It also allows them to create online storefronts with just a few clicks. Prospects can connect with shippers by sending them a request through the storefront and getting a quote in minutes, instead of the 24-48 hours it usually takes.
Once a freight forwarding job is initiated, shipments can be tracked with an integrated real-time EDI tool, so shippers and customers know exactly where their shipping containers are. The tracking software also integrates with the accounting tools on GoFreight’s platform, so users know how shipment performance affects their earnings.
Co-founder and CEO Trenton Chen earned his masters and PhD in the United States before returning to Taiwan to join TSMC. At the time, AppWorks and other startup programs were getting a lot of attention, and Chen decided that he wanted to be an entrepreneur. He quit TSMC (“It was a tough decision because nobody was on board,” he told TechCrunch) and gave himself six months to come up with a viable idea. During that time, one of his co-founders lived in Los Angeles, working as an importer for a family business.
“When I was in the US, I also knew a lot of people in this industry. So many of our good friends have asked us to go there and see how bad the software is. So in the last month of my six month stint, I decided to give it a chance, I bought a three month ticket to go to Los Angeles and spend time with the top 10 shippers, learning how they do business with the software . We started GoFreight after the first week we were there,” Chen said.
Although Chen says the global freight forwarding market is worth an estimated $280 billion, nearly all the software it runs on is outdated. GoFreight’s goal is to enable traditional shippers to remain competitive with the same technological quality as Flexport.
“A freight forwarding business deals with how to get goods from point A to point B. Software can really help, but it’s not their core business. The service itself is the core business, and the software can’t help minimize shipping costs or get it done faster. But it can certainly help provide additional valuable insights to customers, importers and exporters,” Chen said, adding, “We try to enable incumbents to compete with Flexport. This is an approach to make the whole industry better and faster.”
Chen says GoFreight differs from other freight forwarding software startups because most of them are looking to build a new ERP system or integrate with existing ones. This is difficult to do because many shippers use outdated ERP systems and it is a fragmented market. Some don’t even use ERP systems; instead, they work on spreadsheets or pen-and-paper systems.
At the back end, GoFreight’s software has sales, operations and accounting tools, so when customers have a request, shippers can enter it into their system and then come back with a quote. Once a job is confirmed, GoFreight manages reservations, real-time shipments and all necessary electronic archiving. They can also generate and send invoices through GoFreight.
“Very importantly, we are trying to become the Shopify of the space, so with one click they can open an online store and their importers can use the online web portal to submit an inquiry and it just pops up in the system, automatically with pricing and they can book their tickets online,” Chen said. “So the front-end application is so important, and we provide visibility solutions as well.”
One of the main challenges GoFreight wants to solve is the quote generation process, which can take a couple of days because freight orders are complex. For example, if a customer wants to ship three containers from Shanghai to Los Angeles, shippers should check with overseas agents who are also shippers. They also have to organize trucking and warehouses. Another thing to consider is spot rates versus contract rates, as spot rates can be much lower.
Most of this work is done through emails, phone calls and text messages, but a centralized customer-facing app means shippers can complete the entire process, including checking with overseas agents, through the integrations of GoFreight, which Chen says cuts the process from two days down to about 10 or 20 seconds. GoFreight is currently working with partners to build a network that connects customers with shippers and shippers with carriers.
GoFreight also provides a digital payment solution, as most of the payments were made through paper checks. This means shippers can issue a link to customers and once clicked, they are taken to the GoFreight website, where they can decide which invoices to pay with credit cards or bank accounts. Then that information feeds back into GoFreight’s ERP system.
The analytics provided by GoFreight can help shippers earn more, Chen said. For example, if they book a 40-foot container, GoFreight will record how much they have paid and how much customers have been charged. The system analyzes performance for top customers and overseas agents, uncovering hidden charges so shippers have a better understanding of the true cost of a shipment. It also breaks down costs by SKU, so shippers and their customers know exactly how much it costs to ship an item.
The new funding will be used to develop more features such as smart quoting, rate management, and purchase order management.
In a statement on the funding, lead partner Tom Gieselmann said, “GoFreight’s all-in-one software provides greater transparency into the movement of goods, enabling shippers to better manage their business, which can range from 0 to 1500 + users, end- end.This versatility makes for an incredibly impactful product and a big reason why we’ve identified them as one of the most promising logistics technology companies on the market.
Change: Changed title with correct funding amount.