Trucker Path

Overview

Trucker Path is a software company building out a suite of offerings for the trucking industry.  It offers three product lines targeting long haul truckers.  Its initial product was a navigational and trip planning app called Trucker Path.  More recently it added a freight hauling marketplace platform called Truckloads, and InstaPay which is a factoring service.  The company monetizes via a premium version of the app along with its factoring services offered via its Truckloads platform.

The company is based in Mountain View, California and has ~60 employees.  Its founder is Ivan Tsybaev, a serial entrepreneur.

Why I like Them

Although I don't usually like app companies, Trucker Path caught my attention because what started as a basic navigation app for truckers has been able to transform itself into a full platform and freight logistics marketplace for goods shipped via truck. Trucking is a slow moving, fragmented industry and the team was clever to get their app and brand known by first offering targeted navigation features to the professional long haul trucker customer.  By all reports truckers are delighted by the app with an average of 4.7 out of 5 stars and 35,000 user reviews.  Trucker Path leveraged this satisfied user base to solve the chicken and egg problem in building a freight marketplace. 

This smart progression in product offerings has rewarded the team with extremely strong traction as they have 600,000 truckers using the navigation app.  Their freight marketplace Truckloads, has over 100,000 carriers searching through over 3 million monthly loads posted by 800+ freight companies.  The biggest opportunity lies with their freight marketplace and factoring business since trucking in the US alone is a $700B+ industry.  There is an open field here to automate the currently inefficient trucking marketplace as can be seen by the recent news that competitor Convoy has recently raised a large sum of money.

Technology like Trucker Path's offering serves as an intermediary step between human based trucking and fully autonomous self driving trucks.  Most importantly they have data that is invaluable to an autonomous trucking fleet operator.  As their head of marketing, Sam Bokher, describes it - "We have the most comprehensive data on trucking-related points of interest, truck parking data – this data have been crowdsourced from our users, so no one else in the industry has such information. In addition to that we have information about where the freight is going and what the current rates are."  It is easy to see how their products could plug right into the technology stack of companies building fully autonomous trucks (Uber, Tesla, etc.).

I also had a chance to ask the team about their thoughts on fully autonomous trucking.  They don't see it being real for at least another 10 years and see the regulatory framework as not even close to where it would need to be to support fully autonomous trucking networks.

Trucker Path has strong prospects with the growth opportunity of their trucking freight marketplace business along with the value of their proprietary mapping and trucking related data trove.

Disclosure:  I have spoken to members of the executive team.

Navigation App

EquityZen

Overview

EquityZen is an online marketplace for buying secondary shares of private companies.  Private company shareholders can sign up with what they are offering.  Accredited Investors can then browse EquityZen's platform and offer a deal for the shares they are interested in.  EquityZen handles all the transaction details including getting the private company's permission.  As they scale the firm has lowered the minimum investment size from millions of dollars to thousands.  They have to date worked with several dozen Unicorns including Cloudera, Lyft, SquareSpace and AppDynamics.

Wait you say, this has been done before by SecondMarket (acquired by NASDAQ in 2015).  The difference with EquityZen is they structure the transaction as a derivative to transfer the economics of the shares without transferring legal ownership.  Basically it makes the transaction company friendly as no strangers gain control rights and no change to the cap table.  This fundamental difference gives them a leg up on SecondMarket.  The founder's like to refer to this as Secondaries 2.0.

Why I like Them

I like them because I think there has been a heavy unmet need for this type of product that continues to grow, especially as the number of unicorns soars.  It's no secret that there are fewer companies going public today than in the last 30 years for a variety of reasons.  As private markets become the new public markets, platforms like EquityZen allow employees to take some money off the table.  Simultaneously, it opens the door to accredited investors not able to invest in venture capital firms but seeking higher returns in more "exotic" asset classes like startups.  It also allows easier portfolio rebalancing for institutional investors.

Where you will really see a platform like EquityZen take off is in the event of a financial crisis or recession.  As shareholders seek liquidity for otherwise illiquid pre-IPO stock, supply will jump on the platform bringing more savvy "value" style investors to the table.

They have a lot of competition with several other players in the space so it will be interesting to see if there difference in deal structure is a strong enough differentiator.

Disclosure:  All information is from publicly available sources, I have not had any contact with a member of the company or its investors.

Inturn

Overview

Inturn is a SaaS marketplace platform for brands to sell their excess inventory to retailers.  For sellers, it allows brands to organize, price, and sell excess inventory quickly through privately controlled channels (vital in allowing brands to protect their image). Underperforming products can quickly and easily be sold off to make room for better selling inventory.  This is especially helpful to retailers after holidays when they face high amounts of merchandise returns.  Buyers (such as discount retailers like TJ Max or Ross) are able to search for a brand's excess inventory and easily negotiate.  They are also able to discover inventory they would not otherwise have known about or have access to.  

Inturn earns revenue through subscription fees to its platform and takes a small percentage of each transaction.  The company was founded in May 2013 and is based in New York City.

Why I like Them

As retail becomes more competitive, faster paced, and business models like fast fashion continues to dominate the clothing industry, the ability of a brand to quickly get rid of its excess inventory for the next set of merchandise is vital.  Inventory management is critical for retailers, especially as turnover is faster with consumer taste becoming ever more fickle.  Inturn is the only firm out there offering brands modern software tools for excess inventory management, allowing for a much more efficient market.  Prior to Inturn, manual tools and processes  were used that were slow and created an inefficient market.

On the other side of the transaction, the retailer benefits as off-price merchandise is one area physical retailers are holding their own against eCommerce sales.  Discount retailers saw foot traffic grow in the last several years and forecasters expect discount retail to grow at a much faster pace than the rest of the industry for the next several years.  The trend seems to be that off-price retail is becoming the core business for many retailers such as Nordstrom.

This is an underserved, inefficient B2B process that will continue to grow, positioning Inturn nicely, especially as it expands its platform to other types of consumer products beyond apparel.   

Disclosure:  All information is from publicly available sources, I have not had any contact with a member of the company or its investors.