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Seattle Startup Launches Partial Truckload Service

FreightWeb announced the launch of its partial truckload transportation service on Tuesday, backed by $3 million in seed funding from Madrona Venture Group and 8VC.

Benzinga · 02/04/2020 16:27

FreightWeb announced the launch of its partial truckload transportation service on Tuesday, backed by $3 million in seed funding from Madrona Venture Group and 8VC.

The startup, headquartered in Seattle, is taking a multi-pronged approach to solving a perennial problem in the trucking industry: the fact that shippers are typically forced to pay for a whole truck, even when their freight may occupy only a fraction of the trailer.

Unlike with less-than-truckload (LTL) and truckload (TL) shipments, there hasn't historically been a way to get automated price quotes for partial truckload shipments, defined as loads of between six and 20 pallets, said co-founder and CEO Will Payson.

Full truckload freight service is optimized for 26- to 30-pallet loads that use all the space in a truck. Meanwhile, LTL carriers, moving between one and five pallets, are an unpredictable and often more expensive solution for larger shipments.

As a result, shippers that need to ship only half a truckload of freight often have to pay for the whole truck or spend hours tracking down a quote.

FreightWeb streamlines that process with instant quotes and booking, saving shippers around 25% on trucking costs, according to Payson.

"We are focused on doing the one thing that historically shippers have found to be a royal pain," he said. "We want to take that pain away."

In addition to brokering loads, FreightWeb is launching an owner-operator-based partial truckload carrier operation across Southern California, Arizona and Texas.

The carrier focus distinguishes FreightWeb from other supply chain startups. "Most people in the freight-tech space like the tech aspect," Payson said. "They want to be totally non asset."

Not so the FreightWeb executive team, a group with decades of experience in leadership roles at FedEx Corporation (NYSE: FDX), Amazon.com, Inc. (NASDAQ: AMZN), and carriers and brokerages. "We came to the conclusion that that's not the solution for us," explained Payson, a former FedEx vice president who left a position leading business intelligence and operations engineering at Amazon for his new venture. "We needed to position as a carrier and say we will take responsibility for the move."
A patent pending on a metal rack system to help handle customer freight is another example of what Payson describes as the team's laser focus on finding solutions to the partial truckload conundrum.

Conventional truckload is limited by the number of pallet positions, Payson explained. Although he declined to talk in detail about the new technology — more coming in a few months, he said — the system can basically turn "a truckload of pallets into half a truck," saving, well, a truckload of money in the process.

Like many in the supply chain startup space, Payson touted FreightWeb's green credentials, citing statistics from the U.S. Department of Transportation showing that two-thirds of all loaded trucks are mostly empty, and an additional 25% are actually empty.

Noting his kids "are always talking to me about the planet and environment," Payson acknowledged that "doing what's right environmentally is [often] hard because it costs more money or it's more work."
But with the FreightWeb solution, which reduces carbon emissions by around 35%, shippers and logistics companies looking for partial truckload options don't have to spend or pollute as much. "Underused truck capacity is a huge waste," said Payson, "and we've built out the physical technology, science and tech to solve it."

Scott Jacobson, managing director at Madrona Venture Group, echoed that sentiment in a press release.

"FreightWeb is addressing a particularly underserved segment of the market with a simple, easy-to-use service that is better for both shippers and carriers," he said. "The opportunities to apply technology to improve efficiency and reduce waste are tremendous."

Image by Free-Photos from Pixabay