Take a look around you. From the screen you’re staring at to the shoes on your feet, chances are you’re surrounded by products made in China, India, and Europe. Whether you realize it or not, you rely on the trillion-dollar international freight industry to get these items from the factory to your doorstep.
But the process is much less high-tech than you’d think. Communication between shippers, freight forwarders, and carriers is powered by email and Excel, according to Freightos founder Zvi Schreiber, and there’s an average lag time of three days if you’re a shipper looking to get a price quote.
In an effort to bring this industry up to speed, Freightos, a four-year-old startup based in Hong Kong, has locked down $14 million in Series B funding. Existing investors Aleph, Annox Capital, ICV and OurCrowd were joined by MSR Capital and Sadara Ventures to bring the company’s funding total to $23.3 million.
Freightos, essentially, is building the Kayak or Expedia for international shippers. Both individual users and freight forwarders can use the platform to search for and filter shipping options by price, time, route, fees involved, or type of transportation.
“It’s quite straightforward, and quite analogous to what you’ve seen in other industries,” says Schreiber. “But in this industry, it’s really quite revolutionary.”
That’s partially because the average freight quote typically has 20 associated fees: the trucking fee, the ocean liner fee, the fuel fees, the handling fee, the piracy risk fee, the seasonal surcharge, the hazardous surcharge, the port fees… you get the point.
“We’ve developed a big data solution to get all these prices together, and then a routing engine and a pricing engine to get all of these fees, right down to the toll for the truck if it crosses the Golden Gate Bridge,” Schreiber says.
The platform is available in multiple languages and currencies (Chinese is especially important), and recently, Freightos added in a sustainability feature.
“Some of the big importers are committed to measuring their carbon footprint, and a big part of that footprint is in importing goods,” says Schrieber. “Fuel burns for air cargo is often several times the rate of the cargo, so if a company really cares about sustainability, maybe they’ll switch to ocean liners instead.”
The company is currently working with over 30 freight forwarders, including billion-dollar logistics giants such as Hellmann Worldwide and Nippon Express. For these guys, Schreiber says, collecting all of their data and integrating with Freightos can take a full year.
Last quarter alone, the company processed 24,000 automated quotes, ranging from a couple hundred dollars to tens of thousands of dollars for shipping multiple containers.
“When you buy a laptop or furniture part of the price you’re paying is for the inefficiency of the shipping,” says Schreiber. “In the end, by making this more transparent and automated, we can expect to see an impact on the price tag in the store.”