Online load board and digital freight marketplace Truckstop.com announced Monday the acquisition of RMIS, the Westlake Village, California-based carrier compliance automator.
RMIS’ capabilities — the most important of which is fulfilling 98% of freight brokers’ requests for carrier certificates of insurance within 60 seconds — will augment SaferWatch, a similar carrier onboarding solution acquired by Truckstop in 2018.
“There are two primary reasons why we did the deal and why we’re excited about it,” Truckstop.com Chief Executive Officer Paris Cole told FreightWaves. “We’re marrying up RMIS’ best-in-class carrier onboarding and insurance monitoring with our marketplace. That solidifies our leadership in facilitating relationships between shippers, brokers and carriers. Now we’re connecting SaferWatch to RMIS, bringing compliance-as-a-service to the freight industry.”
While in some cases SaferWatch can let freight brokers and 3PLs attach a more rich set of data to carrier profiles than RMIS, RMIS is known for its ability to use APIs to service very large customers, many with proprietary transportation management systems. Coyote Logistics, GlobalTranz Enterprises, Echo Global Logistics, Mode Transportation, BNSF Logistics, Werner Global Logistics, PLS Logistics, NFI, Sunset Transportation, Fastmore, Axle Logistics and Penske all use RMIS for carrier onboarding. SaferWatch is better known for its penetration of middle-market and SMB brokerages.
“There is overlap between SaferWatch and RMIS,” Cole said. “It’s not a pure market share play and it’s not a pure integration play — it’s a combination of both. RMIS’ primary product is carrier onboarding. SaferWatch also does insurance certificates, but there’s additional data it gathers that RMIS doesn’t have. The real power in this combination is the different customer bases between the two products.”
While Truckstop has purchased a few companies over the years, the large round it raised from ICONIQ Capital in 2018 may be accelerating its M&A activity. Truckstop is known to have submitted an indication of interest — essentially an early-stage bid — to purchase factoring company OTR Capital through a sale process being managed by Stephens.
“We have been quiet about the acquisitions that we’ve done, but since I’ve been with Truckstop, we’ve done five acquisitions,” Cole said. “M&A has always been part of our thought process. We’re squarely focused on organic growth, but when opportunities arise to augment and extend our services, we take a look.”
RMIS was founded in 1996 as a third-party software vendor for freight brokers that could help them track insurance certificates. After a couple of pivots, the company built an automated system in 2009 that allowed its customers to scale their carrier networks even more rapidly. From its early days, RMIS had a close relationship with Truckstop, and in 2011, Truckstop launched a carrier registration service, CRS and CRS Plus, in a collaboration with RMIS.
“Most people don’t know this, but there was a point in time when you would call customer support at RMIS, you’d be talking to an RMIS employee sitting in our building in New Plymouth, Idaho — that’s how tight the partnership was,” Cole explained. “In late 2015, we ended that partnership but maintained a close relationship with [RMIS President] Hayden [Landon] and the leadership team there. Periodically Hayden and I have talked throughout the years, and we felt late last year that it was the right time to get serious about a potential acquisition.”
Beyond offering a consolidated compliance-as-a-service product to the freight brokerage industry, Cole said that RMIS would make Truckstop’s freight marketplace more intelligent. RMIS’ freight brokerage data — the company’s insights into which carriers have relationships with which brokerages — will reveal structures and patterns that Truckstop hopes to leverage. Truckstop may be able to create solutions that recommend previously unknown capacity to a brokerage during a tight market, or connect a carrier with more sources of freight in a looser market.
“What you’ll see from us with this acquisition is that we’ll be able to better match carriers and brokers together because now we’ll know even more than we do today,” Cole said. “We’ll know which brokers have onboarded or approved which carriers, and we can help those relationships and help increase the capacity for our 3PL and brokerage customers.”
Unlocking that kind of value from the acquisition will be something of a heavier lift for Truckstop’s technology team, which will need to collate customer, lane and carrier attributes from its load board data with RMIS’ broker-carrier relationship records and then refine Truckstop’s matching algorithms.
“We really believe this is one of those opportunities when one plus one equals four or five, not in terms of valuation but in terms of value we offer to our customers,” Cole concluded.