Trucker Path, a three-year-old, Mountain View-based platform that helps connect drivers, brokers, shippers, and carriers, has just lined up $30 million in debt funding so it can start loaning some of those truckers money right after they deliver their freight.
Its seemingly a win-win. It means truckers neednt wait 30 to 60 days to get paid by the vendors who hire them. In the meantime, the loans are a new revenue opportunity for Trucker Path, which is charging its customers slightly more in interest than its paying its debt provider: Flexible Funding, a lower-flying, 25-year-old lending institution in San Francisco.
Its the latest twist in the war to win over the hearts of the 1.6 million long-haul truckers in the U.S., a somewhat stunning 550,000 of whom are already using Trucker Paths app, according to cofounder and CEO IvanTsybaev.
Why do they use it? Well, partly to communicate to their peers where parking is, and isnt, available. In fact, its one of the stickiest features of the app, which began as a navigational tool but now features everything from crowdsourcing to the ability to track shipments from dispatch to delivery.
While people outside the industry might not grasp what a pain in the butt it is to park a truck, a survey by the Department of Transportation has shown that 75 percent of drivers say they regularly have trouble finding a safe place to park when they need to rest.Using Trucker Path, drivers save 11 hours, or $600, each month, insists Tsybaev. Meanwhile, you can imagine the savings for enterprise customers like Pepsi and FedEx that send out thousands of trucks every day.
Trucker Path isnt their only option, of course. Youve probably read about the growing spate of startups looking to elbow aside traditional trucking companies, includingTurvo, which we wrote about here, and Uber Freight a freight broker thats eventually expected, like Trucker Path, to offer a single platform where brokers, shippers, and carriers can worktogether in real time.
But Tsybaev says his company already has the kind of network effect that can mean the difference between barely surviving and thriving, and investors apparently buy his argument. The 60-person company which has already raised $21.5 million from Renren and Wicklow Capital of Chicago, among others says its right now talking with investors about a Series B round and that its already fielding term sheets.
The new funding should help on a number of fronts. One new feature the company has been working on is an insurance marketplace for its trucking customers; theyll gain access to numerous providers that would otherwise have trouble connecting with these individuals but can reach them more easily with Trucker Paths help.
Trucker Path also says it wants to beef up its enterprise sales force, and to create a fully automated marketplace, so truckers dont have to worry about negotiating with shippers or freight brokers. Indeed, ultimately, says Tsybaev, a trucker will be able to tell Trucker Paths app how long theyll be on the road, and it will immediately provide him or her with the right freight at the right price.
Then, thanks to its new debt facility, it can give that person a cash advance. Speaking of which, new equity funding will also come in handy on that front. As Tsybaev explains it,the companys debt lender provides capital for most of every invoice, but Trucker Path covers a small percentage, too.
To scale into a multi-billion dollar business, says Tsybaev, and naturally it means to, we need more capital.