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Freight forwarder Steam Logistics launching truckload brokerage April 1

(Photo: Jim Allen / FreightWaves)

Access America team reunited and ready to roll out domestic offering

Jason Provonsha and Steve Cox are getting the band back together. Provonsha, the chief executive officer at Chattanooga, Tennessee-based international freight forwarder Steam Logistics, and Cox, the company’s president, have been busy recruiting old teammates from their days at freight brokerage Access America as Steam prepares to launch its own domestic brokerage operation on April 1.

Steam was founded in late 2012 as the international service offering of Access America Transport. When Access was acquired by Coyote Logistics in 2014, Steam was spun off as an independent company. Initial progress was slow, but the hard-charging truck brokers gradually adapted to the slower sales cycle and more complex regulatory environment of international ocean and air freight.

In 2019, gross revenue at Steam totaled about $33 million, but it exploded to $100 million for the full year of 2020. Top-line numbers were helped by exceptionally tight capacity and high rates, but also signaled that Steam had turned a corner and successfully scaled the business.

When Cox’s and Provonsha’s noncompetes finally expire, it will be time to transform Steam into the rarest of third-party logistics providers: an organically grown non-vessel operating common carrier (NVOCC) building its own domestic freight offering from the ground up. Dry van, refrigerated and flatbed truckload brokerage will be added to Steam’s current air, ocean and customs brokerage offerings.

“Our plan is to launch the brokerage on April 1 — that’s when we’re released from this noncompete,” Provonsha explained. “Over the past handful of months, we’ve been looking at who we want to join us, how we’re going to launch and which strategies we’re going to employ. On launch day we’ll have 15 people hired — all veterans we know in this space, mostly former Access team members. Our approach has been able to find the best talent we could attract — wasn’t hard based on our relationships. It’s been really easy to get the band back together and get people excited about where we wanted to go.”

Provonsha said that Steam has hired five key leaders, who have in turn built their own teams, to make sure that the brokerage will be fully operational on Day 1. Steam hired Mathew Soloff, Ryan Doherty, Lee Brittain, Seth Shaver and Jeff Wood, each of them experienced freight brokers who worked together at Access America, as executive vice presidents running their own teams. Wood will lead a new branch in Minneapolis. Steam expects its truckload brokerage to have a workforce of about 45 people by the end of the year.

(From left: Lee Brittain, Ryan Doherty, Mathew Soloff, and Seth Shaver. Photo: Steam Logistics)

Most of Steam’s portfolio of 1,500 international customers have domestic freight, and Provonsha and Cox want to sell brokerage to them as part of a holistic, integrated service offering. The majority of 3PLs with both domestic and international divisions built those businesses through mergers and acquisitions rather than growing them organically, which can leave intact separate organizational hierarchies, go-to-market strategies, company cultures, technology platforms and operations.

“We’ll have one person running sales teams for international and domestic,” Cox said. “It’s very difficult for 3PLs to have that connection and offer one point of contact there. It’s a rare company that’s going to be able to integrate those lines of service.”

Provonsha added, “We have a group of outside sales and client success who sit above these divisions; their role is to help us avoid those siloes.”

Both men emphasized that Steam’s scale meant that the international logistics business was large enough and profitable enough — Steam has been largely bootstrapped since its founding — to stand on its own as the truckload brokerage grows.

“If we launched domestic four or five years ago, it would have felt like a life preserver we wanted to hang onto,” Provonsha said. “Now as we launch we’re already scaling, so it’s adding fuel to a fire as opposed to stoking one from scratch. We feel like we have a pretty big moat. To any broker wanting to start a freight forwarder, be our guest — we’ll see you in 10 years.”

(Jeff Wood will lead a new Minneapolis branch. Photo: Steam Logistics)

Because Steam has always had a mandate of profitable growth and has not taken venture capital, its internal operations largely rely on customized versions of off-the-shelf technology rather than a proprietary transportation management system. Instead of investing heavily in building its own platform for the ground up — and, it must be said, reinventing the wheel — Steam has focused its technology spend on a web portal for customers that offers seamless visibility into their loads.

“We’ve always considered ourselves a tech-enabled 3PL,” Provonsha said. “We don’t try to package ourselves as a ‘software business,’ but what we’ve traditionally done is take existing platforms and build on them. We have a platform for international and we’re launching one for domestic, two systems internally running the business with visibility to all teams.”

Steam built a data warehouse that will pull from both the domestic and international systems and surface that information in a customer-facing portal called SteamVision, giving shippers intuitive multimodal visibility into their freight.

Provonsha and Cox reflected on what changed, and what hasn’t changed, about truckload brokerage since their days at Access America.

“One of the things we’re thinking about is margin compression driven by new players in the space who are tech driven,” Provonsha said. “We’re very cognizant of the fact that we can’t dust off an old playbook and reenter this market. But it doesn’t mean that the same things that made us successful before can’t reemerge this time.”

Cox chalked that success up to Access’s sales culture, which he said was “an electric culture — the feeling that we’re going to outwork everyone else out there. We created an opportunity for people to be entrepreneurs and change their lot in life. There’s a lot of excitement: If your compensation structure is correct, people work hard every day through the end of the month. People are focused on the customer because they’re compensated based on what they do for the customer.”

At precisely 12:01 a.m. April 1, Steam’s new brokers will begin making sales calls from the floor. International customers are already vying to have their freight be the first domestic truckload moved by Steam.

John Paul Hampstead

John Paul conducts research on multimodal freight markets and holds a Ph.D. in English literature from the University of Michigan. Prior to building a research team at FreightWaves, JP spent two years on the editorial side covering trucking markets, freight brokerage, and M&A.