Arrive Logistics takes on over $300M investment led by ATL Partners

“The investment has been a long time coming and puts us in a great position for the next five years of growth,” Pyatt said. In a conversation with FreightWaves, Pyatt recounted Arrive’s history of capital raises — three rounds totaling about $50 million since the company was founded in 2014 — and noted that Arrive had scaled despite being undercapitalized relative to some of its growth-y peers. 

Running hard on a thin balance sheet meant that Arrive was forced into some reactive decisions when COVID-19 shutdowns turned freight markets upside down in 2020. Pyatt said that the 10% headcount reduction and temporary hiring freeze meant that Arrive’s teams were strained when freight heated back up. This investment will allow Pyatt and his team to focus on a long-term strategy regardless of freight market volatility.

“We’re a billion dollar company and we’ve always had a thin balance sheet,” Pyatt said. “We wanted to have a larger vision — being short-term creates thrash.”

Andrew Clarke agreed, adding that he was excited to inject substantial capital into the business and help prepare it for the next stage of growth.

“One of [co-founder and president] Eric [Dunigan] and Matt’s strengths is their ability to see through the cycle,” Clarke said. “Now they have the capital to operate through the cycle too.”

First on the list of priorities for Arrive’s new cash infusion is dramatically increasing the 3PL’s technology investments. Historically, Arrive spent about $5 million annually on technology, first customizing an off-the-shelf TMS and then building its own. Tech spend will grow to $20 million this year and run at $30 million annually for the next five years, Pyatt said. And that figure accounts for internal development work not including purchased software, data, or integrations.

“Our carriers and our customers want new capabilities and features,” Pyatt said, noting that Arrive’s planned expansion into new service offerings — potentially including a managed transportation platform for small and midsized businesses — also requires a larger software development team.

Expanding Arrive’s services is another priority for Pyatt, Dunigan and the leadership team. To date, about 95% of Arrive’s business has been full truckload brokerage, with the remaining 5% composed of a smattering of less-than-truckload and intermodal. Pyatt wants to invest more heavily in growing those offerings, and he’s also considering services like cross-border, expedited and, yes, international. Arrive plans to add 1,000 net new employees per year for the next three years, rapidly accelerating from its current headcount of approximately 1,300 employees. 

Eventually Arrive will decide whether to buy or build an international freight forwarding division, and Pyatt is betting that Jerome Lorrain — who served as the chief executive officer of CEVA Logistics and on the board of Pilot Freight Services — can help. Clarke, of course, oversaw the acquisition and integration of several freight forwarders as chief financial officer at Robinson. 

The war chest will also help Arrive double down on its long-standing “corridor” strategy of building highly expert, reliable capacity with small and midsized fleets on dense power lanes. More cash on the balance sheet will let Arrive take on more freight and cultivate deeper relationships with the best carriers on those lanes.

For now, much of Pyatt’s attention will turn to planning: to building infrastructure like recruiting and training, preparing to scale the developer team and getting accounts payable and receivable in order. 

“We also need to answer questions like: ‘What’s the right velocity of growth?’” Pyatt said. “We grew 50% last year and we’ll grow 50% this year. We can give projections, but this investment gives us the flexibility to toggle that growth rate up or down depending on the opportunities we see.”

Clarke’s excitement to work with such a high-achieving team was palpable in our conversation.

“Our job as a board is to make sure the team has the resources and assets they need to be successful,” Clarke said. “We get to use our breadth of experience to help them see around the corner and work on next-level stuff.”