On Friday before the New Year’s Holiday, while most drivers and executives were thinking about the long weekend, Trucker Path, an app that is ubiquitous in the driver community, announced that the company had been purchased by Chinese social media site Renren.
Renren is a social networking service and internet finance company with operations in both China and the United States. It may not be a household name in the U.S., but the global tech community is familiar with it and it is one of the largest social media providers in China. Renren led Trucker Path’s first seed round of funding in 2014 with a $1.5 million investment and then participated in a $20 million Series A round in 2015.
Trucker Path’s core app uses crowdsourced data to help truck drivers find truck stops, available parking spots and quickly identifies open weigh stations. The driver parking-app-turned-load board saw early success and boasts 600,000 active users, 35% of which are long-haul truck drivers, at the time of the Renren investment. The primary use of the app in 2015 was a real-time parking directory and roadside amenities app.
At the time of the investment, Trucker Path’s CEO Ivan Tsybaev stated that the investment from Renren allows it to invest in a community where it could lend its experience in building social communities and help Trucker Path thrive.
Back in 2015, the company was pre-revenue and was banking on building a significant user base of drivers. According to reviews in both the Google and Apple app stores, the Trucker Path app is loved by drivers. It is rated a 4.7 in the Google Play Store and has 5 stars on 14,000+ reviews in the Apple App Store. Trucker Path accomplished something that few others had figured out - how to get truck drivers to use a mobile app on a daily basis. More impressive was the company’s ability to get drivers to engage in a social network that was industry specific.
The company then went on, three months later, to raise an eye-popping amount of money for a pre-revenue trucking startup. Chicago-based Wicklow Capital led the funding round with Renren also contributing. Each invested $10 million which led the CEO to state the value of the company at more than $100M. The Trucker Path investment got a lot of attention because it validated the desire for venture investors to get a piece of the $700B industry. It was followed by large investments in Cargo Chief, Convoy, and Transfix - all of which were digital brokers.
But Trucker Path did not become a digital broker, instead choosing a different path. Being a brokerage requires a lot of manual labor and Trucker Path wanted to build itself as a transactional marketplace. To achieve that goal, the company started with a load board app for owner operators known as “Truckloads” with plans to turn it into a marketplace.
The success of building any two-sided marketplace involves getting density of buyers and sellers. Trucker Path had successfully built a network of carriers, so it needed freight.
Getting freight from shippers to post on a load board can be difficult, but Trucker Path believed it had an advantage. With over 400,000 drivers in its portfolio at the time, it says that most brokers have since turned to it to leverage its vast network of capacity.
Renren started as a popular social network in China and after going public on NYSE in 2011 became a global business. Now the company is primarily owned by U.S. citizens and the Japanese Softbank. Its CEO, Joseph Chen, drove a truck for his family business along the U.S. East Coast for three years when he was younger, so he knows well the challenges truckers and the industry are facing.
This is not the only business Renren operates in the U.S. Its portfolio of companies includes Chime CRM, Geographic Farm and Sindeo - all serving the real estate industry. It has also been active in funding startups, for example SoFi and LendingHome.
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