There are any number of ways for brokers to capture the hearts, minds, and the wheels of carriers and drivers. One way is to help put money into their hands as fast as possible.
That's what Dallas-based TriumphPay set out to achieve when it launched in late 2017. An operating subsidiary of Triumph Bancorp Inc., TriumphPay built its model around two payment programs: "QuickPay," which pays carriers and drivers the next business day after the broker approves the carrier's invoice, and "StandardPay," which follows the payment terms contractually set between brokers and carriers.
Brokers work with TriumphPay to set the terms of their QuickPay programs. Carriers pay a fee off the net invoice for QuickPay, and TriumphPay shares the fee with the broker. QuickPay is available on a per-invoice or on a per-relationship basis.
TriumphPay's value proposition lies in facilitating a broker's own quick payment program, according to Haley Evans, TriumphPay's vice president of sales. Some brokers have not gained much traction with their own quick payment programs, Evans said. In addition, a broker may not have the cash flow needed to pay the carrier before getting paid by its shipper customer, she said.
TriumphPay has succeeded, Evans said, because "we offer similar terms that a carrier is used to, instead of factoring their invoices for a fee, a carrier can opt into their broker's QuickPay program thus maintaining that relationship with their broker and still getting their money fast. We then revenue-share with the broker, thus turning a program that once strained their cash flow into revenue." In addition, the program helps the broker maintain its relationship with their carriers while reducing brokers' accounts payable back-office work, she said.
Demand for the company's services has risen significantly. At the end of 2017, its platform had 71 brokers and had paid 12,000 carriers. Today, it has 223 brokers and more than 60,000 carriers. For its work, TriumphPay was honored with the Number 20 spot in the FreightTech25 at November's FreightWaves LIVE event in Chicago.
Under TriumphPay's on-boarding process, a broker submits a list of carriers along with each carrier's preferred method of payment, Evans said. To reduce incidences of fraud, TriumphPay authenticates each carrier via contact information provided by the broker. This way, TriumphPay ensures the right person will get paid, Evans said.
Once the broker signs off on the completed transaction, TriumphPay executes the payment. TriumphPay also works with shippers who choose to pay their carriers directly.
TriumphPay competes with factoring companies, even though its parent operates as a factor. For cash-strapped carriers, the QuickPay process can be a better alternative to factoring because a factor may be buying a receivables list that hadn't been first approved by the broker, which can lead to payment delays until the list is approved. Factoring is typically used when a payee is dealing with a chronically slow-paying payor.
The next step in TriumphPay's evolution is to pay carriers immediately after a load is delivered and signed off for, and to make the money available in real time. Even in an era where it is common to have immediate access to funds, it remains an elusive quest to put money in drivers' and carriers' hands right away. Those are 2020 and 2021 initiatives, according to Evans.