Up-and-coming freight forwarder aims to flip script in how to reach customers and Japanese fund is on board for that.
Flexport, the venture capital-backed freight forwarder, secured an additional $1billion in new funding in a round led by a unit Japan’s SoftBank Group.
The new investment comes after earlier reports that the San Francisco-based company was on track to raise new funding.
Flexport says the new capital raised will be used to add new infrastructure and expand its headcount. Flexport announced plans last year that it wants to expand its physical footprint with additional warehousing space and the charter of a second airplane.
The six-year old company said it reached $500 million in revenue in 2018 and is closing in on becoming a top 10 freight forwarder in the busy trans-Pacific trade market.
Flexport, which has already raised $304 million, said its headcount has now reached 1,000 employees. It also claimed the 11th spot in ocean freight forwarding in the trans-Pacific market, which saw strong growth last year due to shippers rushing to bring goods into the U.S. ahead of expected tariffs.
Flexport’s main pitch to shippers is to offer additional visibility on where their goods are with the aid of technology. Among the value-added services Flexport offers are desktop dashboards to track shipments and better analytics on transportation costs.
The company has also sought to leverage its technology into truck-specific applications such as an electronic logging device, marketed under its subsidiary Transmission.
SoftBank Managing Partner Michael Ronen, who will join Flexport’s board of directors, said the potential for further market share gains in a fragmented industry ripe for new technology attracted SoftBank’s Vision Fund to invest. The fund manages a $100 billion portfolio.
"Flexport's pioneering use of technology and its data advantage position the company for exceptional growth in this multi-trillion dollar industry," Ronen said.
Flexport Chief Executive Officer Ryan Petersen said the company aims “to create a better, more interconnected world and [SoftBank’s] support will propel us into that future, making global trade easier for everyone."
In addition to SoftBank, existing Flexport investors Founders Fund, DST Global, Cherubic Ventures, Susa Ventures and SF Express also participated in the round.