With the supply chain under constant pressure due to the pandemic, freight forwarding has become one of the hottest startup sectors over the past two years. In fact, international freight forwarding is now a $199 billion market. And the evidence is mounting.
In November last year, digital freight forwarder Forto raised another $50 million led by Inven Capital. In April this year, NuvoCargo raised $12 million to digitize the freight logistics industry. In May, ZenCargo raised $42 million with a freight forwarding platform. In June, Freight Forward Consignor raised $80M at a $1B+ valuation. Freightify landed $2.5M in July to ease rate management for freight forwarders.
and today, vector.ai, which says it helps freight forwarders improve productivity through its AI platform, has raised $15 million in Series A led by US VC Bessemer Venture Partners. This included existing investors Dynamo Ventures and Episode 1. Bessemer’s investment is another sign that US VCs continue to infiltrate the UK and European tech landscape.
Vector now plans to accelerate its international expansion plans in the form of an automated system for freight forwarders.
The problem it is facing is this: Freight forwarders lose time on repetitive administrative tasks as they hunt through customer emails, etc., instead of focusing on high-value activities. Vector.AI says that this machine learning platform can automate these tasks.
Its customers now include Frech, EFL, NNR Global Logistics, The Scarbrough Group, Steam Logistics and Navia Freight, as well as other top-10 freight forwarders.
James Combs, Co-Founder and CEO of Vector.AI, commented: “Most employees at freight forwarders spend most of their time communicating with the 10-25 different entities that may be associated with a given shipment and freight forwarders. Can coordinate documentation.. Communication usually goes through email and attachments… The volume of freight traffic continues to increase globally – and with it Brexit’s additional burden And pandemic disruptions such as recent port closures in China – freight forwarders are facing staff shortages, huge wage hikes, and shipping delays, which continue to cost companies money in revenue and perishable goods. They can’t afford to waste time on low-level processing, which is why we’ve built technology to automate basic tasks.”
Mike Drosh, partner at Bessemer Venture Partners, said: “Vector.ai is one of the early leaders in an emerging class of freight forwarding workflow automation and digitization tools. It has created an intuitive and industry-focused product – something that is already Winning over the biggest freight forwarder.