GoFreight raises $28 million
Unicorn Flexport is reshaping the logistics industry by acting as a freight forwarder and providing software that allows users to manage their shipments. However, there are hundreds of smaller freight forwarders who rely on antiquated ERP software or spreadsheets. GoFreight aims to help companies compete by delivering the “Shopify of freight forwarding,” with backend software that streamlines operations and a frontend that allows them to put up a shop and give bids in minutes.
Flex Capital and Headline led the $23 million Series A investment round for the Los Angeles and Taipei-based firm. LFX Venture Partners, Palm Drive Capital, Mucker Capital, Cornerstone Ventures, and Red Building Capital also participated in the round.
GoFreight, which presently serves roughly 1,000 clients, assists in the management of commodities transiting by the ocean, air, and land routes. It also allows companies to quickly create online marketplaces. Potential consumers may contact freight forwarders by placing an inquiry via the storefront and receiving a quote within a few minutes, rather than the normal 24 to 48 hours.
Once a freight forwarding project is underway, shipments may be traced using an EDI-integrated, real-time tool, so freight forwarders and clients know where their shipping containers are at all times. Tracking software also links with accounting capabilities on GoFreight’s platform, allowing customers to see how cargo performance affects their profits.
Trenton Chen, co-founder, and CEO received his Master’s and Ph.D. in the United States before returning to Taiwan to join TSMC. AppWorks and other startup programs were gaining popularity at the time, and Chen decided he wanted to be an entrepreneur. He quit TSMC (“It was a difficult choice since hardly one agreed,” he told TechCrunch) and allowed himself six months to come up with a credible plan. One of his co-founders was living in Los Angeles at the time, working as an importer for a family firm.
“I knew a lot of individuals in this field while I was in the States.” So many of our excellent friends urged us to go there and check out the software. So, in the last month of my six-month term, I decided to give it a go and purchased a three-month trip to Los Angeles to spend time with the first ten freight forwarders, studying how they conduct business with software. “After the first week, we launched GoFreight,” Chen said.
Despite Chen’s claim that the worldwide freight forwarding sector is worth $280 billion, practically all of the software that powers it is obsolete. The purpose of GoFreight is to provide conventional freight forwarders with the same level of technology that Flexport offers.
“A freight forwarding firm is concerned with how to get goods from point A to point B. Although software might be very beneficial, it is not their primary business. The key business is the service itself, and software cannot help reduce delivery costs or get it there quicker. “However, it may undoubtedly assist in providing more relevant information to clients, importers, and exporters,” Chen said, adding, “We attempt to equip incumbents to compete with Flexport.” “That is a strategy for making the whole industry better and quicker.”
According to Chen, GoFreight stands apart from other freight forwarding software companies since most of them are attempting to develop new ERP systems or interact with current ones. This is difficult since many freight forwarders use out-of-date ERP systems, and the industry is fragmented. Some organizations do not even employ ERP systems; instead, they rely on spreadsheets or pen-and-paper solutions.
On the backend, GoFreight’s software includes sales, operational, and accounting features, allowing freight forwarders to submit client inquiries into their system and then respond with a price. Once a project is confirmed, GoFreight handles reservations, real-time shipments, and any electronic filings that are required. They may also use GoFreight to produce and send invoices.
“Most significantly, we’re attempting to become the Shopify of the sector, so that its importers can use the online web portal to inquire, and it simply comes up in the system instantly with a price, and they can book their tickets online,” Chen said. “So the front-end application is critical, and we also give visibility solutions.”
A key issue that GoFreight intends to address is the process of producing bids, which might take several days due to the complexity of freight forwarding orders. For example, if a client wishes to send three containers from Shanghai to Los Angeles, freight forwarders must consult with foreign freight forwarding brokers. They must also arrange for shipping and warehousing space. Another factor to consider is the difference between spot rates and contract rates, since spot prices may be substantially lower.
The majority of this work is done via emails, phone calls, and text messages, but with a centralized customer-facing app, freight forwarders can complete the entire process, including checking with overseas agents, via GoFreight’s integrations, which Chen claims reduces the process from two days to about 10 or 20 seconds. GoFreight is presently collaborating with partners to establish a network that links clients and freight forwarders, as well as freight forwarders and carriers.
Because most payments were made using paper checks, GoFreight also offers a digital payment alternative. This implies that freight forwarders may send consumers a link, and when they click on it, they are sent to GoFreight’s website, where they can choose which bills to pay using credit cards or bank accounts. The data is then sent back into GoFreight’s ERP system.
According to Chen, GoFreight analytics may help freight forwarders generate more money. For example, if they reserve a 40-foot container, GoFreight will keep track of how much they spent and how much consumers were charged. The technology monitors top clients’ and overseas agents’ performance, identifying hidden costs so freight forwarders may better grasp the true cost of cargo. It also breaks down expenses by SKU, allowing freight forwarders and their clients to see precisely how much it costs to send an item.
The additional cash will be used to create new features such as smart quoting, rate management, and purchase order management.
Headline partner Tom Gieselmann stated in a statement regarding the financing, “GoFreight’s all-in-one platform delivers more transparency to freight movement, enabling freight forwarders to better manage their company, which may vary anywhere from 0 to 1,500+ users, end-to-end.” This adaptability makes the product very powerful, and it is one of the main reasons why we have chosen them as one of the most promising logistics tech businesses on the market.