Do you remember that brief golden age when Burt Reynolds was the epitome of cool? It all started for us with Smokey and the Bandit. The premise was pretty simple: A hotshot trucker named Bandit (Reynolds) and his sidekick snowman (played by country star Jerry Reed) are hired to bootleg Coors beer across the country by a couple of dudes dressed like Boss Hogg. Bandit drives a Trans Am to distract Johnny Law while Snowman sits behind the wheel of an 18-wheeler with 400 cases of Rocky Mountain suds. All sorts of high-speed hijinks ensue. Today, something like that would never happen. Who would want to risk jail time for Coors beer? Also, like so many other industries, the digitization of trucking is poised to disrupt the 18-wheeler culture forever. Everyone is talking self-driving trucks—a subject we’ll also tackle in a future article—but the digital shakeup is more widespread than that.
How big? We’ll turn to the bright minds at CB Insights for a few numbers: Last year, trucking startups hauled more than $750 million over 55 deals. This year, the pace for deal-making is a little slower, but the size of the deals is bigger, and 2017 is on track to surpass last year’s record high. As of June, trucking startups had raised $478 million, with $1 billion a real possibility.
The big money is not necessarily flowing to the sexy side of the trucking industry, meaning self-driving big rigs. The biggest round to date has gone to a Chinese logistics company called Huochebang that has been called the “Uber of Trucking”. It represents two significant trends right now in the digitization of the trucking industry. First, just about every country in the world seems to have a startup (or three) sporting the title “Uber of Trucking” which basically boils down to on-demand trucking. These companies serve as a sort of dispatcher, optimizing the transportation of cargo from Point A to Point B by ensuring trucks are fully loaded at all times. Bells and whistles include real-time tracking GPS locations of lot lizards. Second, China, like in many tech industries, is a big player to watch in this space.
We tracked down nearly 20 startups doing some version of “Uber of Trucking”. We’ve jammed in the more well-funded ones below, so by no means is this an exhaustive list.
Uber of China
If you’ve ever flipped over the products on a store shelf, you probably noticed a trend: Made in China. It’s quite the logistics feat to get all of those quality Wal-Mart products from the child-slave factories to the American heartland. The trucking industry in China is responsible for hauling about 75 percent of the country’s commercial cargo, with an estimated five million truck drivers endlessly blaring their horns at anything that gets in their way.
Two of the biggest companies vying for supremacy on China’s rapidly growing roadways are Huochebang and Yunmanman.
Huochebang catapulted into the unicorn club in May with a $156 million Series B led by one of China’s big tech giants, Baidu. That brought total disclosed funding since December 2016 to $271 million, with a $1 billion valuation. The company serves as an online dispatcher, connecting drivers to cargo. It also maps out more fuel-efficient routes and ensures drivers don’t run out of gas. Caixin reports that the Guizhou startup is also adding a financial services arm to its business model, building trucker credit history by tracking their movements for loan purposes.
Another Chinese unicorn valued around $1 billion, Yunmanman employs a similar model and has backing from an equally impressive list of funders, including one of the top VC firms, Sequoia Capital. The three-year-old company has raised $165 million, including a $110 million Series D last December. The company is reportedly using the fresh cash to dabble in artificial intelligence and big data to strengthen the…