Freight-booking company connects shippers with trucking fleets via an app and website
Transfix, an online service helping companies to hire trucks to move their goods, said Wednesday it had raised $42 million from investors, in one of the largest funding rounds to date for a freight booking startup.
The Series C funding round, led by New Enterprise Associates, raises the New York-based company’s valuation by between 300% and 500% compared with a year ago, said Drew McElroy, Transfix’s founder and chief executive. Last year, a person familiar with Transfix’s valuation pegged it at over $75 million.
Transfix has raised a total of $78.5 million since its founding in 2013. The company projects it will be profitable in 12 to 18 months, Mr. McElroy said.
Startups hope to use technology to more cheaply and efficiently pair shippers and truckers in a business that is still often conducted by armies of brokers via phone and email.
In addition to other freight-booking startups, including Convoy and Cargo Chief, trucking has begun to attract the attention of technology giants. Uber Technologies Inc. launched a trucking app in May, and Amazon.com Inc. is working on its own booking solution. Traditional freight brokers, including market leader C.H. Robinson Worldwide Inc., also have invested in online platforms and other technology.
Transfix will use the new backing to build out its freight-matching service and add to its sales team, Mr. McElroy said. Although the company launched with a marketplace where shippers could book trucks directly, Transfix gets a growing share of its revenue from managing transportation for large companies, Mr. McElroy said. That means tailoring technology to the needs of individual customers, and hiring teams to manage the largest clients, he said.
“This is still a new concept” to most shippers, Mr. McElroy said. “We’ll continue to grow. The longer we stay with them, the more share [of their freight] we continue to see.”