Container shipping giant A.P. Moeller-Maersk A/S and Ports America, the largest terminal operator in the U.S., are investing in a digital freight-booking service aimed at speeding the flow of cargo through maritime gateways.
Maersk’s venture-capital arm led a $19 million funding round for Loadsmart Inc. to support a new service for the port trucking market, the startup said Thursday. Maersk and fellow investors Connor Capital SB and Chromo Invest also led a $21.6 million round last year for Loadsmart, which has raised $53.4 million since it was founded five years ago.
The company isn’t calling the latest backing a Series B funding round because it is aimed at a specific product rather than broader company support.
Loadsmart plans to use the new backing to hire more engineers, data scientists and product managers as it rolls out a load-matching service aimed at reducing container-terminal bottlenecks for trucks at port terminals.
That business, known as drayage, is a small but critical point in supply chains in which trucks ferry containers between ports and distribution centers, often on trips of less than 50 miles. The operation can be maddeningly inefficient, with trucks often backed up at major ports during busy shipping periods as terminal companies sort through thousands of boxes that may be waiting for transport.
Loadsmart’s service matches truck drivers with the best available container based on appointments, wait time, travel time and other factors. The platform syncs up with the terminal’s operating system to track containers and notifies carriers when containers matching their mileage preferences are unloaded from vessels.
“You already know what length of haul he operates and you are able to give him not the container he is looking for, but the one that sits on top of the stack and requires no shuffling,” said Loadsmart Chief Executive and co-founder Ricardo Salgado. “So we are wired in to the truckers, and wired into the port.”
The company’s main business is an online truckload brokerage platform that uses algorithms to provide customers including Daimler AG , Coca-Cola Co. and Kraft-Heinz Co. with instant rate quotes and match their shipments with available carriers.
The startup has more than 200 employees and aims to turn a profit by 2023, Mr. Salgado said. He declined to provide the company’s annual revenue or current valuation.
Loadsmart’s Smart Drayage initiative launched in April at Ports America’s terminal in Newark, N.J., at the Port of New York and New Jersey. Loadsmart expects to expand the initiative to more locations in coming months, including, potentially, the Port of Baltimore and a large West Coast port.
Maersk, which is building its services beyond maritime transport, uses Loadsmart’s technology to book 53-foot-truckload shipments on the spot market for U.S. customers of its Maersk Transportation division.
The drayage market has drawn interest from other startups looking to use technology to streamline operations. NEXT Trucking Inc., the developer of a freight-matching app for truck drivers and shippers at the ports of Los Angeles and Long Beach, raised $97 million in Series C funding in January.
Corrections & Amplifications
Loadsmart expects to turn a profit in 2023. An earlier version of this article incorrectly stated that the company expects to reach profitability in 2020. Also, Loadsmart’s port-trucking initiative launched in April at Ports America’s terminal in Newark, N.J. An earlier version of this story incorrectly listed the location as Bayonne, N.J.(Sept. 5, 2019)
Original Source: https://www.wsj.com/articles/freight-matching-startup-loadsmart-adds-19-million-from-maersk-ports-america-11567684801