Article written by Deborah Lockridge
Oren Zaslansky grew up in the trucking business, started a truckload company at age 21, moved on from there to a brokerage, and then decided he wanted to see how he could use technology to totally reinvent how we think about less-than-truckload freight.
The result is Flock Freight, which uses proprietary algorithms to pool (or “flock”) freight moving in the same direction onto one truck, minimizing damage, guaranteeing delivery times, and enabling carriers to fill their trucks and maximize their earnings.
We talked to Oren about his vision and what it means for shippers and carriers.
HDT: Tell us how you got into this business.
Zaslansky: I was born into freight. It’s always sort of corny when I say that, but my parents worked for a van line, for a household goods carrier for, for decades. So my entire childhood was listening to Mom and Dad at dinner, talking about freight bills and flatbeds and ocean freight. When I was in high school, my mom left and started her own military freight forwarder, basically a broker in freight for household goods specializing in international military relocation. When I was in college, my dad left the van line and started his own military freight forwarder. So by the time I graduated college, I felt like I had existed at the intersection of freight and entrepreneurship.
When I was 21, I started a full truckload carrier, which is kind of crazy, but maybe makes it a bit of sense, understanding my background. I capitalized that business by factoring my receivables. I leased seven trailers and contracted seven owner-operators on the power side and grew that to about 125 units over a five-year period.
I wanted to take on something with a greater degree of complexity and impact. So I put in a management team to run the day-to-day operations and I started a brokerage, specializing in what we call project management logistics. So I built that business for about the next 12 years and then I really kind of said, ‘All right, I’m ready to work on the industry, not in it.’
You know, this industry has been good to me. It’s been good to my family. Yet I look at it and scratch my head and say, you know, we could be better. We could really bring technology, not to just incrementally nudge it along, but rather to reimagine and reinvent. What if we really changed the whole thing? How would I want to start? How would I apply technology in ways we’ve never seen before?
HDT: So what was your idea?
Zaslansky: I had been working on combining partial truckloads. We did not invent that, but I really believed with tremendous software and very sophisticated algorithms, I could “carpool” [less-than-truckload freight]. You wouldn’t move it through the hub and spoke, which is the existing way of doing it. You would go to the truckload industry – independent owner operators, small, medium, large fleets, you want all of them to play in this new space. You would say, let’s take LTL and create multi-stop truckloads. Another way of thinking about it is, let’s share truckloads.
So in 2014, early 2015, I brought in a couple of co-founders and advisors and mentors and we put a little of our own money into it to build a proof of concept algorithm. It was in the early days of companies like Cargomatic and Convoy getting launched, and Uber freight, and everybody focused on truckload, matching that full load to the empty truck. And I said, you know, you’re taking traditional brokerage and making a little bit better.
We felt like we’re going to change the rules of the game. We don’t want to just make something a little better. We’re going to apply technology in a way where we fundamentally change the way the freight moves. So we started raising venture capital, and we’re off to the races.
HDT: You didn’t initially launch it as Flock Freight, right? It was called something else.
Zaslansky: We initially launched as Auptix, meant to harken the idea of optimization and I put the A-U on the front because I thought that was like automation. We would use automation to optimize. And then the X was meant to create the optic sound like “optics” – like we see things no one else sees. So it was, we’re going to use automation to drive optimization and have insights. I was very proud of myself. That was the business for two and a half, three years, and then I hired a head of marketing who said, that’s a terrible name.
So we’re exactly the same business in every way, shape or form, but we changed the name and rebranded and came out as Flock Freight, with hopefully the understanding being we want to flock your freight. If you think about like a flock of birds, you’re all better off moving together than you are on your own. So that’s what we believe we do, is we flock LTL freight.
HDT: So tell me more about how what you do is different from all the other companies out there aiming to revolutionize the industry with digital apps.
Zaslansky: I believe we are the only company in the world that can say we use technology software specifically to change the way the freight is going to move. So without Flock, a shipper has a six-pallet LTL shipment. It is going to move through some form of hub-and-spoke operator, and it’s going to move through five terminals between Chicago and LA. With us, that freight is going to share a ride on a 53 foot trailer. We’re actually doing what we call a modal conversion. We’re changing the mode. So it’s LTL but it is moved truckload.
Some of these companies have built really great technology and they’re hopefully reducing friction. They’re increasing automation, they’re making things more efficient, but they didn’t really change anything, right? The freight is going to move the same way with or without them.
The LTL mode is problematic – very low pickup and delivery, very high damage, high loss and theft, long transit times. The hub-and-spoke model is a 100-year-old innovation. We have a four-year old innovation in what we’re doing. So we’re simply bringing the truckload mode to the less-than-truckload shipper.
Where we’re moving toward that is super exciting is the idea of the driver having not only more visibility, but having choice over the routing. We’re talking about reordering of the stops. Customers want you to pick up at a certain date and time and deliver at a certain date and time; you can’t mess with that. But as we’re growing, we have so much more volume and we have so much more technology that we’re creating the capability for those carriers to do our multi stops in a way where they can choose themselves ways to bend the routes to go through their home, so that they can be still loaded, yet still able to go home for a couple of days and then get back on the road and keep driving to effect the delivery. We want to make sure that the carriers out there really want our multi-stop, that they see it as being more profitable and having more flexibility.
HDT: And so this is the interface on that technical end for the carriers?
Zaslansky: Yep. For now, we haven’t gone to the app route yet. We could deploy an app very quickly, but rather we’re trying to go through integrations. On the mid to larger sized carriers, you could do an EDI or API connection directly into them or their TMS. And we’re looking at partners on the app side [at working with companies with apps that] have high levels of engagement with those drivers. And we’re in the process of deployment right now.
We’re attempting to create an environment where it’s like, we can plug in to your ELD. We can plug in through some type of middle software provider. We can plug in direct to your TMS. If you have that capability, you can work with a carrier sales rep in the way that you’re kind of very used to.
For us, [an app] is kind of the last piece of the business that we’re starting to build now, because it’s not our core strategy. We want to work with drivers in lots of different ways.
HDT: How has the rising demand for e-commerce affected your model?
E-commerce is kind of tertiary to us. You know, e-commerce is still largely parcel, small package, Amazon showing up, dropping off a cube. We’re in the pallets business, between two and 24 pallets, that’s the space we like to play. We will leave the one or two pallets to FedEx or UPS, and the 25 and 26 pallets are just full truckloads.
We could partner with Amazon to enable them like between their hubs, right? We could be a partner to them and say, yeah, but we can take your LTL or your large partials. We just haven’t made the decision to do that so far.
HDT: How has the COVID-19 pandemic affected you?
Zaslansky: We’ve had no furloughs, no payroll reductions. And in fact, we’re at record levels. Say you make toilet paper, right? That’s been so crazy, but you know, we can’t get toilet paper in the store. We have some customers who make paper products like that. And they’re saying, the traditional hub and spoke is going to take five days to get my toilet paper shipment to a Costco or a Walmart or an Amazon fulfillment center, and Flock can do it in three days.
This is an opportunity for us to not waste a good crisis and allow many, many people to experience Flock Direct, to experience shared truckload in a way that they never have before. And so we’ve been acquiring new customers at rates we could have never imagined.
Original Source: https://www.truckinginfo.com/10120301/qa-flock-freights-founder-on-reinventing-ltl