MIAMI–(BUSINESS WIRE)– SmartHop, the total dispatch solution that enables businesses to truck smarter not harder, today announced a $12 million Series A financing round, led by Union Square Ventures (USV) with participation from RyderVentures — a new corporate venture capital fund by leading logistics company Ryder System, Inc. — Equal Ventures, and Greycroft. The investment comes less than a year after SmartHop’s $4.5 million seed round, bringing SmartHop’s total funding since its 2018 launch to $16.5 million. The company will use financing from its Series A round to continue investing in its full-service dispatching platform, to grow its team and to seek strategic partnerships that enable small trucking companies to make smarter decisions that boost revenues and give them more control of their business.
In 2019, 72.5% of all freight transported in the U.S. was hauled by trucks, equating to 11.84 billion tons, according to The American Trucking Association. The vast majority of trucking companies — 91% — operate six or fewer trucks, and these smaller trucking businesses have been strained due to ongoing driver shortages and tighter capacities resulting from the COVID-19 pandemic. Additionally, most small/independent owner-operators only have access to loads in the spot market, the 20% of the trucking market in which rates are based on current supply and demand for trucks on one-time or inconsistent load volumes. These loads are typically networked across dozens of impersonal brokers and low-quality load boards, leading to a fragmented market where inefficiencies, a lack of accountability and wasted resources fall disproportionately on small owner-operators.
“The past year was an especially challenging one for small and independent truckers, essential parts of the country’s economy who already were facing significant challenges in competing against large carriers and high rates. We created SmartHop to help these businesses thrive, and the need for our platform is stronger than ever today,” said Guillermo Garcia, co-founder and CEO of SmartHop. “This fundraising round will enable us to continue growing our network and enhance our product and team to meet the urgent and evolving needs of small owner-operators so they can retain the control and freedom that brought them to the trucking market.”
A Business-in-a-Box for Trucking
SmartHop was built to address the specific needs of these small over-the-road trucking owner-operators. Its AI-powered “business-in-a-box” solution helps owner-operators compete with the big carriers by reducing operational costs, streamlining load booking and providing access to the vast broker networks previously only available to large carriers. SmartHop’s load network helps small owner-operators in the spot market pick the best loads from the largest pool, reduce dead hauls based on proximity and availability of load opportunities, and navigate fluctuations in the spot/contract market. The full-service trucking technology connects small owner-operators with everything they need to truck smarter and more profitably, including:
- Freight Dispatch and Load Booking: SmartHop’s Copilot technology-assisted dispatch tool helps plan better routes that yield more profit and higher-paying loads. Copilot’s intelligence also suggests options for the next load so truckers can plan their next move.
- Back Office Support: Its end-to-end 24/7 support gives owner-operators and small carriers the ability to operate like larger fleets.
- Fuel: SmartHop negotiates with top fuel providers to obtain an average discount of 8% on fuel prices, the single largest cost item of their operation.
- Leasing: SmartHop’s SmartPay gives independent truckers and small fleet owners access to lower monthly and per-mile lease rates with bumper-to-bumper maintenance costs built-in via a partnership with Ryder, reducing total cost of ownership by 18%.
- Load Factoring: SmartHop’s factoring program gives truckers faster access to their money and at rates 1-2% below market.
- Insurance: By providing data visibility into driver risk profiles to its insurance partners, SmartHop can provide customers with insurance costs about 13% lower than retail prices.
Customers have seen top line increases of at least 8% relative to what they could find on the market and increase in take-home pay over 48% as a result of a more competitive cost structure. In less than a year, SmartHop has already booked over six thousand loads, resulting in more than $30M annual run rate in customer GMV.
“USV is focused on opportunities to build and leverage unique networks that in turn broaden access,” said Rebecca Kaden, managing partner at USV. “SmartHop is utilizing technology to create opportunity for truckers, a massive and essential workforce, by giving individuals and SMBs the tool sets that they previously couldn’t access and creating a network that allows each node to be stronger by being a part of it. They have seen fast and strong resonance with their customer and have only cracked the surface of what they can offer. We are thrilled to work with the SmartHop team in this next stage of growth.”
Built By Truckers, For Truckers
SmartHop was founded by Guillermo Garcia, who worked as a pet food delivery driver and turned it into a 500-person trucking company in his native Venezuela before immigrating to the U.S. He attended Columbia business school, built a small carrier service in Miami and eventually launched SmartHop in 2018. Since its $4.5M seed round in early 2020, SmartHop has grown its team and network aggressively, adding a number of trucking and logistics veterans, and announcing key partnerships with logistics players including Loadsmart, Redwood Logistics and Parade.
“Ryder established a corporate venture capital fund late last year to identify new technologies and companies addressing pain points in the industry and to help bring their solutions to market quickly. We’ve kept a close eye on SmartHop since its founding and have been impressed by both their technology and their approach to addressing the challenges of fleets,” said Karen Jones, chief marketing officer and executive vice president of new product innovation at Ryder. “As the first investment through RyderVentures, we are firm believers in Guillermo’s vision for SmartHop and are eager to both invest and collaborate to bring Ryder’s 90 years of experience in logistics to support the SmartHop team’s success.”
For more information on SmartHop, please visit www.smarthop.co.
North American truckers move billions of tons of freight annually, and SmartHop is here to move with them as their trusted copilot. SmartHop uses artificial intelligence to deliver smart load recommendations, full-service back-office support, performance tracking and digital bookings at guaranteed above-market rates for small trucking companies. SmartHop lets truckers focus on the road. We handle everything else. SmartHop is backed by Equal Ventures, Union Square Ventures, Greycroft, RyderVentures and Las Olas VC. For more information, visit: www.smarthop.co
About Union Square Ventures
Union Square Ventures is a thesis driven venture capital firm based in New York City. USV’s current thesis is focused on products and services that leverage networks to broaden access to capital, knowledge and wellbeing. The portfolio includes Twitter, Etsy, Twilio, MongoDB, Coinbase, Carta, and Stripe, among others.
About Ryder System, Inc.
Ryder System, Inc. (NYSE: R) is a leading logistics and transportation company. It provides supply chain, dedicated transportation, and fleet management solutions, including full service leasing, rental, and maintenance, used vehicle sales, professional drivers, transportation services, freight brokerage, warehousing and distribution, e-commerce fulfillment, and last mile delivery services, to some of the world’s most-recognized brands. Ryder provides services throughout the United States, Mexico, Canada, and the United Kingdom. In addition, Ryder manages more than 250,000 commercial vehicles and operates more than 300 warehouses encompassing approximately 55 million square feet. Ryder is regularly recognized for its industry-leading practices in third-party logistics, technology-driven innovations, commercial vehicle maintenance, environmentally friendly solutions, corporate social responsibility, world-class safety and security programs, military veteran recruitment initiatives, and the hiring of a diverse workforce. For more information about Ryder, visit www.ryder.com. For more information about RyderVentures, visit ryder.com/ryderventures.
About Equal Ventures
Equal Ventures Management, LLC, is a seed stage venture fund based in New York, NY, that invests in early stage companies within the insurance, logistics, retail infrastructure and the care economy industries. Equal Ventures focuses on backing the founders and businesses that are disrupting legacy markets. Their goal is to identify potential solutions to the market before it’s obvious. www.equal.vc
Greycroft is a seed-to-growth venture capital firm that partners with exceptional entrepreneurs to build transformative companies. The firm has deep experience in both consumer and enterprise technology, with a portfolio that spans the globe. Greycroft values building enduring relationships with founders and understands that they want more from investors than just capital. Greycroft has raised more than $2 billion in commitments and has over 200 active investments. The portfolio includes Acorns, Anine Bing, App Annie, Axios, Bird, BetterCloud, Braintree, Bright Health, Buddy Media, Bumble, Flutterwave, Goop, Happiest Baby, Huffington Post, Icertis, Lightricks, Maker Studios, Medly, Openpath, Scopely, SEMrush, Shipt, TheRealReal, Thrive Market, Trunk Club, Venmo, and Yeahka. For more information visit, www.greycroft.com.