A WHO’S-WHO of America’s tech giants – from Jeff Bezos and LinkedIn co-founder Reid Hoffman to eBay founder Pierre Omidyar – have invested heavily in the Seattle-based truck technology company and now have the backing of king-of-the-geeks Bill Gates.
Lead investor, Con (Bill Gates’ private fund), Cascade Investment Group Inc, Mosaic Ventures and cable TV magnate Barry Diller have invested $62million, bringing the total amount of investment raised to $85.5million.
Convoy matches drivers and carriers with shipping jobs via a mobile app, cutting out call centres, paperwork and ‘idle time’ in the process, meaning the shippers should get charged less and the drivers should get paid more.
Anu Hariharan, a partner with Y Combinator’s Continuity Fund, said: “By improving trucking, Convoy is improving the foundation of our economy.”
“This service allows shippers to transform their supply chains at the same time that it allows carriers to grow their businesses more quickly, on their own terms. In ten years, we’ll be astonished that this was ever done another way.”
Launched in 2015, Convoy originally called itself the, ‘Uber of trucking’ but has since distanced itself from the comparison, not least because the Californian tech company has since launched its own trucking app Uber Freight.
Convoy CEO Dan Lewis is confident that Uber’s more manual system – it uses a manual, phone-operating system to connect drivers to manufacturers – is no match for Convoy’s more tech-driven system. “Uber’s definitely in the freight space,” Lewis said.
“It’s really just us and them, honestly, at this point. But, we’re approaching it with a technical background. They’re approaching it with a very manual approach.
“I think we’ve taken a slightly different approach in terms of how do you automate the process, how do you automate the pricing and how do you identify the right truck using this technology. We have been doing that since day one.”
Convoy was also keen to lose the ‘Uber for trucking’ tagline because, although Lewis admits that Uber has a, “very well-recognised brand with a lot of PR money behind it,” they are still reeling from a string of self-inflicted scandals, including CEO Travis Kalanick’s departure.
Lewis added: “It just became a brand people were uncomfortable being affiliated with. The industry in general is moving away from that term.”
Uber’s interest in the trucking industry is clearly motivated by the possibilities of self-driving trucks. The company purchased automated truck company Otto last year, although this also came with its fair share of drama.
Co-founder of Otto and former Google engineer, Anthony Levandowski, was accused by Google of stealing 14,000 documents containing Google’s self-driving secrets. Uber had to fire Levandowski, who was at the time head of their self-driving car project and the two companies are still embroiled in a bitter lawsuit over the allegations.
Lewis doesn’t believe that fully automated, driverless trucks is something that will happen quickly, not least because of the sheer expense involved in retrofitting existing trucks with self-driving hardware.
He said: “There are going to be a lot of different options with regards to applying self-driving to existing fleets. It’s going to be a multiyear transition, in terms of going from a completely manually operated truck with someone driving it to autonomous trucks.
“And there’s going to be this long transition with the role of the driver evolving. Probably the driver will be in the truck for a very long time doing a lot of tasks.”
Convoy may soon have more competition from one of its original investors, owner of Amazon, Jeff Bezos. Amazon is rumoured to be working on its own app that would pair truck drivers with firms needing goods delivered.
Already the fastest growing tech-enabled trucking network in the US, Convoy will use the new funds raised to accelerate product development and expand further across the country.
Lewis added: “Ask any shipper or truck driver about their business and they’ll point out a dozen things that could run better. Technology is changing this.”