Despite the race to launch fleets of autonomous trucks, human drivers are still in high demand and desperately needed to move cargo from ports to warehouses.
San Francisco-based truck optimization company CloudTrucks just raised $115 million in a Series B that valued the startup at $850 million. The investment was led by Tiger Global and also included Menlo Ventures, Flexport and angel investors Michael Ovitz and OpenDoor CEO Eric Wu.
It builds on two rounds that it raised last year, bringing its total funding to $141.5 million.
The startup was founded in 2019 by CEO Tobenna Arodiogbu, George Ezenna and CTO Jin Shieh. They previously worked at companies including Microsoft, Yammer, Intercom, Zenefits and Opendoor. Arodiogbu also founded an autonomous driving startup called Scotty Labs in 2017 that was acquired by DoorDash in 2019.
“Nearly every sector of the economy relies on drivers to transport its goods and we are eager to use this latest round of funding to continue optimizing the trucking business — especially as our country needs new truck drivers more than ever,” Arodiogbu said in a statement. “We’ve seen the number of loads completed on our platform grow 8x since last year, and we recognize the importance of providing a complete business-in-a-box solution for drivers to make the most of every run.”
The company currently offers three main products for independent truck drivers and small fleets with fewer than 10 drivers. It provides services for payments, load sourcing, scheduling and analytics. It also provides compliance with federal transportation regulations for operators who need it, as well as a truck leasing program.
Its Virtual Carrier product is a full-service option that offers truckers everything in its suite of services, including cargo and liability insurance. For operators that already have federal certifications to transport goods — commonly referred to as "authority" — and don't need insurance, it offers a Flex plan with a lower fee. And for those who only need help streamlining and speeding up payments, CT Cash can used as a standalone product.
CloudTruck takes a 6% to 15% cut of a driver's revenue from each load, which it says is half the industry rate. For payments-only services, it takes a 1.5% fee.
There are a little over four dozen startups building a new generation of semitrucks and related services in the Bay Area including CloudTrucks, Uber Freight, Tesla and Waymo, according to PitchBook.
Around 3.4 million truck drivers were employed in 2020, which was down almost 7% from the previous year, according to according to the American Trucking Associations, an industry group based in Virginia. Most fleets — nearly 92% — only operate half a dozen or fewer trucks, and the industry generated $732 billion in gross revenue last year.
The company has grown from 14 employees last year to 34 right now, according to PitchBook.
