Austin freight brokerage Arrive Logistics Inc. had a tumultuous 2020, at one point laying off or furloughing 10% of its staff as the pandemic took hold of the world and disrupted shipping markets.
But the startup's turnaround has been remarkable.
It resumed hiring in July, and went on to add 300 people last year. It ended 2020 with $810 million in gross revenue, up from the $530 million it logged in 2019. Now, after announcing April 28 that it has raised at least $300 million in new funding, Arrive Logistics is targeting $1.2 billion in 2021 revenue.
Arrive Logistics, one of Austin's biggest freight logistics companies, was founded in 2014 by CEO Matt Pyatt and President Eric Dunigan. The company uses matching algorithms to pair shipping companies with businesses that are looking to move their products. It had 10 employees in 2014 but has since grown to 1,028, with 704 people at its headquarters in Southeast Austin and others at an office in Chicago.
The company now plans to hire another 1,000 people per year for the next three years, with 60% of those being in Austin, Pyatt said via email. Arrive has grown organically, and it plans to continue that. But it will also be eyeing acquisition opportunities, he said.
The company hasn't disclosed its valuation but that kind of revenue generation would likely give it unicorn status, which refers to privately held startups valued at $1 billion or more.
In addition to hiring, Arrive will invest in its proprietary technology and create new service offerings, Pyatt said.
"As one of the few brokerages with a proprietary transportation management system, we leverage our wealth of data to improve processes, provide insights to our partners and deliver the best service," he wrote. "Our philosophy revolves around how our partners prefer to do business — so we’re committed to creating a frictionless experience with tech that empowers our partners to choose the best ways for us to meet their needs."
The company plans to invest $20 million in technology this year and boost that to $30 million a year for the next five years.
"Right now 95% of our business is focused on full truckload," he wrote. "With this funding, we will expand the other 5% which is dedicated to less-than-truckload (LTL) and intermodal. We will invest more into those offerings and consider expanding into other services such as cross-border, expedited and international."
"Over the last seven years, we have focused on building a top-tier workforce, strong relationships with our partners and best-in-class technology,” Pyatt said in a statement. “Today we are focused on innovation that empowers our partners, building digital solutions to provide a seamless experience designed for efficiency and asset-like services.”
The new money came from New York City-based private equity firm ATL Partners. The firm and startup didn't share an exact investment amount, saying only that it is more than $300 million, making ATL the company's largest minority stakeholder. Baupost Group, British Columbia Investment Management Corporation and Temasek also invested in the primary and secondary equity round.
That adds to about $50 million in funding Arrive Logistics previously raised across three funding rounds.
One of Arrive's previous investors, Lead Edge Capital, sold part of its stake in the business as part of the latest funding, the Wall Street Journal reported.
As part of the deal, Jerome Lorrain and Paul Bell will join Arrive's board, and Andrew Clarke will become chairman.
Editor's note: An earlier version of this story said the company laid off 10% of its staff. The company says the 10% was a combination of layoffs and furloughs. The story has been updated to reflect that.
