A 2021 white paper from DHL Express found that by 2025, 80% of all B2B interactions between suppliers and buyers will take place in digital channels. The company cited the introduction of tech-savvy millennials into the workforce and the rapid acceleration of digital trends because of the COVID-19 pandemic that forced large segments of the global workforce to shift to remote work.
That is opening doors for rapid expansion of B2B commerce, which remains just a fraction of the B2C segment at this point. E-commerce platform BigCommerce predicts B2B e-commerce will reach $1.8 trillion by 2023, accounting for 17% of all B2B sales in the U.S.
That rapid growth will drive another need — last-mile delivery technology. On Monday, B2B last-mile delivery technology platform Dispatch announced it had raised a $50 million series C funding round led by PeakSpan Capital.
“Partnering with PeakSpan was a win-win. The firm not only understood our product and mission but also that we lead with our core values,” said Andrew Leone, CEO and co-founder of Dispatch. “This capital will fuel our continued explosive growth and tech innovation. We look forward to providing more job opportunities while helping our customers execute on flawless last-mile delivery experiences.”
Bloomington, Minnesota-based Dispatch said the money will be used to expand into 50 additional U.S. markets while powering the continued growth of its platform.
Watch: Tech’s growing role in the supply chain
“We love Dispatch’s maniacal focus on driving efficient and cost-effective same-day, last-mile deliveries in the wholesale industrial supply chain. The market opportunity is massive but sees way less attention when compared to B2C last-mile delivery. The team has brought an innovative digital labor marketplace solution to industry segments where the last-mile delivery pain is most pernicious,” said Jack Freeman, a partner at PeakSpan Capital. “We are thrilled to be partnering with the Dispatch team and look forward to supporting the company’s mission of scaling a national platform for B2B last-mile delivery.”
Dispatch said it has grown revenue at about 175% year-over-year in each of the past two years and it has doubled its headcount in that time frame.
Investors such as Trinity Private Equity Group, Revolution’s Rise of the Rest, Great North Labs, and Labora led previous investment rounds. Dispatch had previously raised $11.2 million in a 2020 series B round and $7.8 million in a 2018 series A round. Total funding is now $71 million, according to Crunchbase.
Dispatch offers several platforms to customers. Its Dispatch Marketplace is an on-demand delivery platform for businesses, connecting them with a network of independent contractor drivers in 50 U.S. cities. Dispatch Connect is a delivery management software platform that helps eliminate manual tasks in the delivery dispatching process.
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