August 8, 2025 • 52 mins
DAT’s acquisition of Convoy’s tech platform marks a major leap in freight innovation—pairing the largest load board with cutting-edge automation. Bill Driegert, EVP at DAT and co-founder of Uber Freight, explains how the platform streamlines carrier procurement, automates up to 98% of loads, and slashes brokerage costs. With DAT’s full ecosystem—load board, factoring, tracking, and now digital freight matching—the future of freight is faster, smarter, and more efficient.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Welcome back.
It's another episode of theFreight360 podcast.
We've got a fun one today.
We've got a guest.
We're going to talk about somebig news that has happened
recently in the industry, butfirst make sure to check out all
the other content that we'vegot.
You can go to Freight360.net ifyou'd like to find our
searchable library of all of ourcontent from long form podcasts
where we interview guests andjust talk about industry best
(00:22):
practices and help you with tipson how to reach out to those
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latest tech that's out there.
And you can even send us amessage and we'll answer your
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There's a little bit of acontact button on our website or
you can just comment on ourYouTube channel and we'll take
(00:44):
your questions.
That way, you've got thefreight broker basics course If
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And leave us that five-starreview.
We haven't run any reviews offin a while, but yeah, good stuff
.
All right, ben, anything new inSouth Florida today before we
introduce our guest.
Speaker 2 (01:04):
Yeah, just looking forward to winter.
That's about it.
Super hot, like it's been allsummer.
Speaker 1 (01:09):
All right.
Well, without further ado,we've got Bill Driegert with us.
Today we're going to talk aboutthe DAT acquisition of Convoy
and all the tech there.
Bill, welcome to the show,really quick.
For anyone who doesn't know,you, feel free and give a brief
rundown on you or yourbackground, current role, and
(01:30):
we'll dig all into.
Speaker 3 (01:30):
Convoy and DAT later on in the episode.
But feel free and give a quickintro.
Yeah, thanks for having me.
So I've been in this industrysince 2006.
I was fourth employee at CoyoteLogistics, spent about eight
years there, spent a coupleyears at Amazon and then was
co-founder of Uber Freight andspent about eight years building
that up, before going over toFlexport and having the
fortuitous opportunity toacquire the assets of Convoy as
that wound down and we, ofcourse, recently sold that to
(01:53):
DAT, which we'll talk abouttoday, and so now I'm EVP of
Convoy Platform over here at DAT, driving Convoy Platform within
the DAT ecosystem.
Speaker 1 (02:01):
Awesome and I'm super excited to dig into that.
Dat's had a massive 12 months.
I feel like we've talked aboutacquisition after acquisition
and just a lot of great productdevelopment.
So we'll get into the convoypart of it in a little bit here.
That is the big news, so we'regoing to skip over our news
portion today For a quick sportsroundup.
(02:22):
Ben, did you see the BuffaloBills are the Hard Knocks
preseason team they selectedthis year.
Speaker 2 (02:29):
I didn't.
Speaker 1 (02:30):
So I'm a diehard Bills fan.
Being here in Buffalo, I havenever watched Hard Knocks on HBO
.
Basically they follow teams.
They've evolved it over theyears.
It's been around for like acouple of decades, I think,
following teams throughout theseason.
But now they've got like followa team through training camp,
which the Bills are beingfeatured on right now, and they
follow another team during theseason and then another team
(02:50):
post offseason.
I guess is what they're doing.
But I went to training camp inRochester, new York, which is
like 75 miles east of Buffalo.
The Bills are like one of fiveor six teams that actually leave
their home facility fortraining camp.
The Bills are like one of fiveor six teams that actually leave
their home facility fortraining camp.
And then we went to on lastFriday they came back to Orchard
(03:16):
Park in Buffalo to do like a inour stadium scrimmage, you know
Bills versus Bills.
And we watched the firstepisode of Hard Knocks last
night when it dropped and theyhad like footage from like
literally last Friday in thatshow and I was like this is
insane.
It's really cool Cause I'm likeI wonder, as we watch the show,
if you know, my wife and I willmake a little cameo, I don't
know, but either way, if you'rea sports fan and your team is
featured, whether it's like.
You know, we talked with Steven, our producer, about having Joe
(03:38):
Burrow on the Netflixquarterback series this that
just dropped from last year'sseason like it's just fun to
follow your team through.
You know, obviously you knowhow the season ends, um, in
those shows.
But just get you pumped up likethis is, you know, training
camp and heading into preseasonthis weekend.
So I'm I'm super excited.
What do you think about thesteelers this year, ben?
Speaker 2 (03:58):
your boys.
I'm saying like cautiouslyoptimistic.
I mean like training campreports are saying that like
aaron rogers is really, I don'tknow, showing leadership
qualities.
I camp reports are saying thatlike Aaron Rodgers is really I
don't know, showing leadershipqualities.
I mean like the fact that likehe's spending time with like the
younger guys on the team.
There's lots of really goodpositive reports from like
almost all of the local media upin Pittsburgh.
So I mean it went from we don'twant this guy would rather him
(04:20):
not be here to immediately likethis warm welcome and it seems
like I don't know could bepretty optimistic.
Speaker 1 (04:27):
We'll see, you never know, man.
I know a bunch of Steelers fansthat were like, if we sign
Rodgers, I'm not going to followthe team anymore.
And I'm like, yeah, if you're adiehard fan, you're still going
to give it a week or two andBilly, you said you're not a big
sports guy, but you said you're.
I mean in the San Fran area,right?
Is there a lot of Niners fansout there?
Speaker 3 (04:44):
Oh, my son is a diehard Niners fan.
I actually grew up in Dallas.
My wife and her whole familyare big Cowboys fans.
Okay, definitely a bit of aNiners Cowboys, oh yeah.
Speaker 1 (04:53):
Oh yeah, very true.
Well, cool, good stuff.
We'll get right into it, bill.
So you came over to DAT.
I mean, this just happened.
What two weeks ago?
Speaker 3 (05:04):
It officially closed last Wednesday.
Speaker 1 (05:05):
So a week ago.
Speaker 3 (05:06):
The first full week, yeah.
Speaker 1 (05:09):
So take us through and then we'll, you know, we'll
dig into it a bit.
For the folks out there thatare listening to kind of paint
the picture of you know how thisall happened and what does it
mean.
Can you kind of set the stageon?
You know, I kind of want tohear more about you too.
I mean, your background's superimpressive, but how did, how
(05:29):
did the convoy platform you know, how did you feel about it and
how did it work for you in theyears past and how did
everything lead up to thisacquisition?
We'll start there.
Speaker 3 (05:39):
Yeah, I've known, I knew Dan pretty early in his
journey with the convoy platform.
I actually met him while I wasstill at Amazon in Seattle when
they were first starting offback in 2015 and 16.
And I always believed in theidea.
It's an idea that reallystarted coming to market in
2012-ish the idea of an Uber forfreight or using an app for
driver to manage freight.
(06:00):
It seems pretty obvious inretrospect and a lot of people
were converging on this ideaaround the same time, but there
weren't a lot of companies thathave the capital and capability
to really push it hard.
And Convoy I mean it came downto Convoy and Uber Freight there
from 2016 to 2020, reallypushing the market and going tit
for tat in terms of productfeatures and just pacing and
(06:22):
growth.
And so I was on the other sideof that because I helped
co-found Uber Freight inSeptember 2016.
Convoy originally launched alittle bit before us in 2015.
So they had a little bit of aheadstart, but we of course,
have the Uber brand name and thefact that Convoy was pacing
their all through that.
They always were leading withproduct, they always had
incredible product, they alwayshad an incredible team and, of
(06:44):
course, they got significantamount of investment and like
gold tier investment investorsthroughout the whole process.
So I was very familiar with itas a competitor and I knew that
they had built a very solidproduct.
I knew that carriers loved theproduct.
I knew the brokers the shippersat the time they worked with
loved what the service thatConvoy offered.
Well, then came the pandemic andlots of things changed.
(07:06):
Uber Freight became quite adifferent company.
We made a large acquisition ofTransPlace Convoy.
Ultimately, the end of thatstory was come 2023, they had to
shut the doors.
Unfortunately, we were able toengage with them very early,
Almost as soon as that happened,reached out to Dan, had a
conversation.
It was clear they had a veryshort window to make a decision
(07:28):
around what to do with thetechnology, because the bank was
effectively taking all theother assets and we had the
opportunity to buy thetechnology.
But it was no business.
We weren't buying a business,we were just buying the tech.
But myself and Ryan, CEO ofFlexport, were super bullish on
just the value of that tech andthat platform and because I was
(07:48):
incredibly familiar with it andhad built very similar
capabilities at Uber, I alsoknew that I was pretty confident
that we could take it and dosomething with it.
Speaker 1 (07:56):
Can you talk a little bit, because there's probably
people in our audience well,there's definitely people in our
audience that are new and maybedon't understand what an Uber
Freight does compared to atraditional brokerage model or
what the convoy technology does.
Can you just break that downBarney style to understand
specifically convoy what?
What is it?
What does it do?
Speaker 3 (08:16):
Yeah, both convoy and Uber Freight were very tech
forward, and I'd say convoy evenmore so in the scope of the
products they built out.
It really starts with adifferent operating model that
is app-centric on the carrierside and then, I'd say, building
up from there.
There was a significant amountof technology investment in all
sorts of different capabilitiesin Convoy, but I think the
(08:36):
pivotal piece that most peoplecenter on is this idea of
instant booking, app-centricbooking, and it's been highly
transformative for carriers andI think, fundamentally, the
carrier market has shifted as aresult over the last 10 years.
So if you put yourself in theshoes of an owner operator and
it's 2010 and you need to find aload or let's say you just got
(08:56):
your CDL how do you get started?
Right, there aren't.
It's a lot of just banging ondoors.
Hopefully you've got some goodrelationships.
Hopefully you've got previousshippers you worked with who you
can offer your services to, ormaybe there's other carriers you
can sign on with, but it's very, it's very unlikely that you
can just book a load the nextday and if you do that, you're
probably going to um, you knowDAT or a load board.
(09:17):
You're making phone calls.
There's a lot of frictioninvolved in that process and if
you're calling a broker, you'reoperating on broker hours, so
you're calling them at 6ambecause you're trying to be the
first one, first call they get,and that's just a very like
that's how it worked up untilreally these models came to
market.
So now today I'm an owneroperator, I can download an app,
I can book a load, I can juststart doing business.
I've heard hundreds of thesestories from carriers where they
(09:40):
said, yeah, I mean first day Igot my CDL.
Carriers where they said, yeah,I mean first day I got my CDL I
didn't have options.
Like now I've got options andit just allows me to be a lot
more, allows them to be a lotmore flexible and have access to
more freight and just managetheir business through the app.
So from a carrier perspective,they can book a load there, all
the tracking happens in the appand then they get paid and their
the payment can be one to twodays.
It's very like everything.
It's a consistent experienceacross a whole set of different
(10:03):
freight types.
From a broker perspective.
So because Uber Freight andConvoy went to market as brokers
and Uber Freight still is abroker Convoy is no longer a
broker.
We shifted away from that.
We decided this tech is great,let's give it to all brokers and
go to market that way.
But from a broker perspective,it's like a magic button.
It's like when a load justcomes off the board or gets
(10:25):
booked at 10 pm and you don'teven have to touch it or call a
carrier.
That's a magical experiencewhen it happens, but it's an
OPEX saver.
And to get there, though, everyelement of that load had to be
optimized and automated.
So, starting with the biddingand the pricing and allowing the
carrier to book itautomatically, all that had to
(10:47):
be built out.
Tracking very robust tracking.
These days, the phone in yourpocket has incredibly precise
GPS and tracking compliance isincredibly high.
Early on, when carriers firststarted using apps, they didn't
want to use them or the trackingwasn't great.
There were issues, but thoseare 10-year-old problems.
Today, carriers using apps.
They're highly compliant.
And then all the paymentssystem had to be built out Up
(11:08):
front.
All the one of the biginvestment areas for Convoy was
in fraud right, because ifyou're going to automate this
like, you've got to ensure thatyou've got very tight controls
in terms of who comes on boardand how we bring carriers
through the compliance process.
So.
Speaker 1 (11:22):
Ben, you know what this makes me think it was.
We go back probably to early on, and when me and you first were
getting into the brokerage side, I remember writing articles on
LinkedIn and like writingcomments when Uber, freight and
Convoy came out because peoplewere like they're going to
replace freight brokers and I'mlike, I'm like they're literally
acting as a brokerage.
They're just leveragingtechnology to do a way better
(11:44):
job and if they can really dothat, well, I think there's
something there and I always sawthe benefit of the technology
versus just trying to replace abroker as the more important
part.
Ben, do you remember when thisfirst stuff all came into
discussion?
Speaker 2 (11:58):
Very much so this is like the mid to later 20-teens.
Speaker 3 (12:02):
Yeah, yeah, there was a lot of anytime a new entrant
comes into market with so muchinvestment, so much media and
impressive attention, there wasa lot of counter narratives in
the market, yeah, and I thinkfundamentally there's a also.
I think, just if I'm a smallcarrier or a small broker and I
can't make that level ofinvestment, what does this mean
(12:26):
for me?
And I think that's also one ofthe things that's changed over
the last 10 years.
A lot of tech now is availableto most brokers and, like, with
us going to DAT, even more sonow they have access to this
capability.
But certainly there was a lot offear in that too, because,
having been at Coyote and havingbeen gone through a broker
startup, a lot of what we weredoing by the time we started
(12:49):
Uber Freight was just goingthrough our wish list, right,
just like automating everything.
That if we had had the budget,we had had the capability and
had had access to this manydevelopers like this is what
everybody would have wanted todo, right.
I think we also got a littlebit of pushback for that,
because I think in any industry,it's not always like the ideas
is a brand new, it's just abetter execution that the tech
has evolved.
You can just do it moreefficiently than you could
before, and if you can do itwith that level of investment,
(13:11):
you can just pace much fasterthan anybody else from a tech
investment perspective.
Speaker 2 (13:14):
I'm curious on the part that you were talking about
on, just like the from thedriver's perspective.
Right, so this is, it's goingall the way down to the driver
level, or to the VIN level, orpretty much that MC level
compliance insurance.
Speaker 3 (13:28):
Yeah, if a carrier is working with convoy platform,
the vast majority of thosecarriers are owner operators and
that's primarily to do with thefact that they have to use the
app to engage in book freight.
We do allow dispatchers midsizecarriers, but they still have
the driver has to manage theload through the application.
Loud dispatchers midsizecarriers, but they still have
the driver has to manage theload through the application.
There's a certain size carrierby which you know they may have
constraints around allowingtheir drivers to use the apps,
(13:50):
but generally that's theconstraint and for them too it's
a strong product market fitbecause they just don't have, as
the other options are not asseamless and easy to use.
So it's a preferred option.
But if you're an owner operatoror if you're on the app, we have
to know the driver, we know thedevice, like.
We know we have thatinformation.
We have a lot of richinformation about the users and
(14:11):
we know then too that like arethey.
You know we have all thelocation information so we can
their IP address, all the rest,all the other information.
So we have a lot of.
We do have driver level detailversus strictly carrier.
Now, if so, we have a lot of,we do have driver level detail
versus strictly carrier.
Now, if it's an owner operatorit's one of the same and so,
because we have such a largeowner operator population,
(14:31):
probably a huge percent of ourcarrier base, by capacity and by
count, is a driver and acarrier and it makes a lot of
sense, like we've talked aboutthis a lot.
Speaker 2 (14:37):
It's like, well, one, just how the whole carrier
market is like segmented, rightand like for owner ops like I
don't want to use the word likedisenfranchised, but like, okay,
you only have so many resourcesright as an owner op to be able
to, like you said, make phonecalls, talk to brokers,
negotiate different loads, right, like even if you're starting
early calling and going, okay,like this load looks good, but
(14:58):
then, okay, well, that load'sbooked.
Now I got to talk to the nextperson.
I got to talk to the nextperson, and then it's the other
uphill battle of like, okay, howlong is your MC history?
Can they verify it?
Do you have enough inspections,which I think were like old
school ways to prevent fraudthat are now probably not as
effective.
But we've always talked aboutthis as a sense that, like how
the industry tried to solve thatbasically created this giant
(15:22):
headwind for owner operatorsright, and for new trucking
company owners to where it'sjust like, okay, so you don't
have history.
Like, how do you start?
How do you gain thatcredibility?
And the reality is is if you'vegot visibility all the way down
to the insurance, the VIN leveland that driver on the tracking
side and specifically all theway through the payment side,
then at the very least, likethat mitigates so much of the
(15:43):
risk for the brokers to workwith those carriers.
that really wasn't solving thatproblem anyway, and it's
certainly not solving it thesedays.
Speaker 3 (15:50):
Yeah, and if I mean from a carrier experience, just
so much easier.
I often use the analogy of likepreviously that it was more
like Craigslist and this is morelike an Amazon, and it's like
somebody brought this up theother day.
They said, well, you know,there's other systems where you
can just book a load online now.
And I said, sure, but if youwent to Amazon and you just you
(16:13):
said, oh, I bought it.
And then they said, great, nowyou have to send a check to the
vendor and it'll show up.
It's the whole experience,right, it's the fact that it's
end-to-end and integrated too.
It just makes it that mucheasier, but also to your point
then lowers the risk becauseyou're controlling every step of
the process and you havevisibility through every step,
so there can't be any disconnectthrough that process.
Speaker 1 (16:34):
And there's so much risk to around that, the Amazon
impact or effect.
I think about how frictionlessthe experience is, which draws
people back in there, and thenthey just get so used to how
easy it is, and I kind of feellike that's the way this is
going, versus, like what yousaid if you order something
(16:54):
online, it's a great, you haveto send a check in.
Well, that's not quite asfrictionless as they made it out
to be originally.
So I'm curious the, the, so notnecessarily how Convoy's
platform operated in the past,but so, moving forward, how does
what's the broker's experiencegoing to be like with Convoy now
part of DAT?
What does that?
Speaker 3 (17:15):
like.
For us, the broker experiencereally centers around their tms.
So we have a series of tmspartnerships.
Uh, we have native integrations.
We just launched with the porttms.
We've got a great one.
Uh, coming to market with thesend tms, where we've got deep
integrations and relationshipswith these tms companies.
We have a broker portal.
A lot of that capability Iexpect we will integrate within
(17:37):
the core DAT system.
What Convoy, really, you know upfront, it is similar to a lot
of the other DFM providers inthat you're managing load state
bidding and all that.
But you have to integrate everystep of the transaction.
So we have to have deepintegrations with the TMS,
because for the TMS, theintention is that it should just
operate like a visible set ofhands, like another carrier rep,
(18:00):
and that really depends on usbeing integrated for booking,
for bidding, for load statemanagement, to tracking, to key
milestone updates, to paymentsand even payment approvals, and
all of that integrated in onesystem just makes it that much
easier.
So it's very TMS.
We have great partnerships withTMSs.
(18:21):
So from a broker perspective,it's a complimentary service.
Now it's a.
You know it's part of the DATpackage going forward as we
think about this as an ecosystem.
So I sign up with Convoyplatform.
If I have a TMS, that haspretty much worked with all the
TMSs at this point, but then weintegrate through the TMS.
(18:42):
Capabilities are slightlyvariant between TMSs so that
should all converge over time.
But yeah, it's as simple as itcan be.
As simple as you just post allyour loads, filter out the ones
that maybe don't work or thatyou want your floor to work, get
real-time feedback on expectedcost to cover probability of
coverage, see when those loadsare booked immediately in your
(19:03):
system off convoy.
You see the carrier.
You can automate the carrierapproval or the carrier approval
.
If you have additional stepsthat you want to take, you can
manually override that or managethat process.
Tracking is all automated.
Breadcrumb data is allautomated.
Anytime you can call thecarrier because you have all the
visibility.
They'll call you because that'swhat's showing in the app and
then payments are managedautomatically.
How?
Speaker 1 (19:23):
about that pricing, though?
Is it like you can put a rangein, or?
Yeah, brokers set the ranges.
Speaker 3 (19:29):
So brokers determine what range they want the price
to be in.
They can set an absolute maxpay that we will never pay above
because it's all programmatic.
It manages bidding activity.
So this is where there wassignificant investment and we've
got real-time ML models thatmanage this behind the scenes
that determine.
You know, are we going to haveregret if we don't take this bid
?
Is this bid within range?
(19:50):
There's a reserve price.
It's operating within for anygiven time.
Speaker 1 (19:53):
This reminds me of eBay early on and how, how great
that evolved everything Right.
Yeah, it's just way moreadvanced.
Speaker 3 (20:00):
Yeah, yeah, if I think back to early eBay, you
could do things like auto acceptcertain counter bids and it has
similar functionality, but it'sall automated on the backend
when, yeah, like, if you thinkof it on, yeah what?
(20:22):
Ebay is actually a good andinteresting case study because
something like 85% of all eBayis actually buy it now versus
bidding, and we have that option.
They can buy it now or they canput a bid and most carriers
choose to bid because they knowthat there's some bid range
above that.
Speaker 1 (20:31):
It's kind of just the operating model you just think
about, like Ben, think about howmuch time is spent at a
brokerage when someone's likeyou know carrier puts an offer
in and like they go on their TMSand like log a carrier offer
and then it might go to somebodyelse who then maybe the manager
has to approve it and it justtakes so many people and so much
time like that.
Speaker 3 (20:58):
That automation of that process just seems like
such a time saver to me.
Yeah, and you have to respond,uh, immediately, because I was
um, I was more inclined to want,like a buy it now, early on as
we were taking thesecapabilities to market.
But it's really, carriersprefer to bid, but only if you
give them a response like rightaway you can't have a bid, and
then it goes like off into theether and you come back 15
minutes later because you justget such dramatic fall off.
Yeah, it's got to be whilethey're in the app, while
they're looking, becauseotherwise they're going to go do
(21:20):
other things, find otheroptions, start calling people.
Speaker 2 (21:23):
I am curious about that that you bring that up,
like what does that look likefrom like a fall off percentage?
And again, like I'm curiouswhat that looks like even
internally, like across thenetwork, right?
So from the carrier'sperspective, right, like I'm
bidding on a few loads, I getaccepted from Nate's load, but
then do I see yours, if you giveme back the higher rate after
(21:46):
I've accepted him and because,like in a practical scenario,
like you know, think back toCoyote, like how we do this,
it's like okay, there's theethics of once you have given
that load and agreed, you aregiving them that freight, even
if you get to carry the callsand you know two minutes later
and gives you a better rate,right.
Like how does the system?
(22:06):
I guess kind of address thatfrom a practical standpoint.
Speaker 3 (22:09):
Yeah, that's why it's very important to respond to
the bid immediately and thenit's a yes, you know, yes, no,
so the carrier doesn't have toeven go out of the session to
get a response.
It's very critical for thesystem because you have the fall
off is dramatic and if you Imean I don't, I don't know the
exact numbers, but I would guessthat your success rate after an
hour to just recalling my timeat coyote, because I did look at
(22:30):
this data in detail back thenit's got to be 10 to 20 percent,
um for the bit, actually evenbeing alive, particularly in
your peak hours, because in a 6to 10 am like, if you try to go
to back to a bit at 1 pm, it'sjust it's not gonna be there,
right, yep, it's like 6 am and 8am, maybe because you're in
that window where people arelike parsing through options,
and I'm sure it's evolved evensince I back the days that I was
(22:51):
looking at that data.
But certainly I and again Idon't recall the exact numbers,
but I do know, like you know,convoy studied this quite
intently in terms of bidresponse and the fall off if you
don't respond immediately Nowthose bids do go and are visible
to brokers.
So if this is where there's alittle bit of learning, when a
broker comes onto the platform,just how does it react, how the
(23:12):
bids come in?
Because you know, the conceptof max pay or the maximum
willing to pay, varies very muchby broker and also it adjusts
with time.
And so how do you get ahead ofthat and say, okay, if you're
willing to pay a thousanddollars one hour out, like, we
will ramp the rate up for you.
We're not going to pay athousand two days out, we'll pay
, you know, 800 or whatever.
(23:32):
And how do we make thattransparent If a what we often
see is they can see the bids, sothey set the max pay at 800,
even though they really will payup to 1,000 if they have to.
And it's now six hours later andthe best bid is 850, but they
set it at 800.
Like, why didn't we take the850?
Well, it's because the systemis absolute right.
You got to control it.
(23:53):
As we're on the floor as we'reon the floor, you're often
having a conversation.
So your real max pay and it's.
It's funny because a lot oftms's have like max pay and then
they have like over max pay,yeah, absolute max pay, yeah,
like emergency pay, yeah, yeah,yeah exactly, and communicating
that concept programmatically,like the computer's gonna, the
algorithm's gonna just do whatit does.
(24:14):
So, yeah, so let me ask you howto use it on the back to like
the broker's use case.
Speaker 1 (24:19):
You mentioned TMS integrations.
Is that like an all or none oris there?
Can they operate?
Can a broker operate in theconvoy or DAT platform without a
TMS integration?
Speaker 3 (24:32):
No, it requires a TMS integration because it's core
to the experience.
Speaker 1 (24:36):
I figured it would.
I just was curious if there wasany way around that.
Speaker 3 (24:38):
Yeah, it's like the Amazon versus the other modes,
because we have to manage loadstate.
So to be able to manage thatsimultaneously.
What you don't want to is theidea is that brokers may be
working these loads Parallelhappens all the time.
If they're posting 100% oftheir freight, they've got a
floor, the floor is working inparallel.
They got a floor, a floorworking in parallel.
So if something, if they bookthat, we want to take it off the
app and vice versa.
So, like you need thoseintegrations.
(25:00):
And then for tracking,everybody has basic tracking
integrations these days in theirTMS.
You just want to upload thatdata.
Speaker 1 (25:07):
Got it, but the tracking is actually happening
through the convoy side of it.
Speaker 3 (25:12):
Is that correct?
Through the app?
Through the app, exactly Okay,got it.
Speaker 2 (25:16):
How is this like?
And it sounds like, I guesslike a very simple question, but
like once, so right now it'sstill technically two separate
products.
They're not integrated yet.
Correct Between being able touse it through the TMS, through
DAT.
Is it still the standalone yet,or have you guys merged them
together?
Speaker 3 (25:34):
They're two separate products.
They are very complementary.
They're definitely featuresthat will be integrated over
time and we'll bring togethercertainly a lot of the
investments in fraud and othercapabilities.
There's application acrossdifferent parts of the DAT
ecosystem.
But really think of it forConvoy.
It's loads that can beautomated, because not all loads
can be automated.
(25:54):
It's a today.
It's a smaller carrier poolbecause it goes through a
different compliance processOver time.
You know we'll integratedifferent capabilities across
both, but DAT is still thelargest load board, lets you do
anything.
It's got full features.
It's fully scoped.
Right, it's 47 years ofdevelopment and build up.
(26:14):
But clearly we expect thesethings.
You know we're going to benefiton both sides and the convoy
network will scale up.
But there's slightly differentuse cases.
You can think of it too, justin the way brokers use them.
Brokers tend to post loads assoon as they get them onto the
convoy platform, let it work inthe background.
Brokers are often using DAT tosource new capacity when they
need it or as they need it, andso a lot, most of pretty much
(26:39):
well every customer we havetoday that I'm aware of also had
a DAT when we went through thisprocess.
So and they use them incomplimentary ways, and
sometimes it's they've gotsimilar people managing the
postings or thinking about howto use them day to day, but it's
, they're very complimentary.
Speaker 2 (26:55):
So from the TMS point of view, from, like, the user
right Once that integration'sthere.
Now what it would look like isI'm basically deciding whether
or not I'm posting my loads toconvoy or to DAT, which will
eventually be one posting, ormaybe an option into one Cause.
We'll eventually be likecentralized under, obviously,
the one umbrella, correct?
Speaker 3 (27:16):
Correct and, as of today, there's more optionality
to post-loads on DAT.
It just covers a broader set ofservices and capabilities and
it's more flexible.
Load has to be well-formed toland on Convoy platform because
we're going to execute it.
We had to have all theinformation.
There can be some differencesthere, but yeah, practically, if
I was starting a broker todayand I was trying to build a tech
(27:39):
forward and highlysophisticated, I would probably
use those in the way that Iwould have most of my freight
posting on Convoy, also postingon DAT.
There's a lot of companies thathave stepped into the market too
to manage inbound calls in amore automated way off of DAT.
I think the market's going tolook.
You know it's fine to be on theinside because I do think this
is one of the pivotal changesthat's going to push through the
(28:00):
market in the next five to 10years.
Carrier procurement in generalis just going to become a lot
more tech driven in terms of howbrokers manage it and DAT just
has a legacy of depth andcoverage and scale and
capabilities and flexibility interms of how the product works
and on the convoy side it's allabout automation efficiency.
Speaker 1 (28:19):
So you mentioned there's some differences between
what's required to post to abasic posting on DAT versus
convoy.
Can you talk?
Because I'm thinking like if Iwant to post any old load on DAT
I'm looking at like origin,destination, equipment, type,
equipment right.
Speaker 3 (28:36):
Yeah, and the date, maybe not even wait.
You can imagine just the usecases at which you're doing that
.
There's a broader set of usecases in which you might post a
load to get it inbound.
Speaker 1 (28:45):
What does that narrower scope look like for
convo With?
Speaker 3 (28:47):
convo.
It's the actual load, right,we're pulling it out of your TMS
scheduled.
Right, it's ready to go.
We've got the pickup location,delivery location, the schedule,
like all the.
Speaker 1 (28:57):
Down to the address.
You got the price range inthere.
Is there limitations onequipment types?
Speaker 3 (29:02):
You can imagine.
I mean, there are definitely alot of operating models in terms
of how brokers manage loads orget freight from their carriers
that support a DAT-like approach, where you just need a little
more flexibility and the loadhas to be automatable.
It has to be a little morerigorous, uh coming through the
(29:24):
convoy platform.
Okay, any limitations onequipment like is it specialized
?
Drive, flatbed and reefer, anddon't do like we don't have the
full scope of specialized interms of uh flatbed as we're on,
you know dat it's pretty muchwhatever.
Like we, it's a, it's a fullybroad set of services got it
cool.
Speaker 1 (29:36):
so what do you go ahead, Ben?
I'll ask some questions inlater.
Speaker 2 (29:40):
What do you kind of see, like what this is going to
look like?
And I would say like probablyin the interim, because I think
you alluded to a minute ago I'mlike I don't think most people
think the industry is going tofunction the way it does today
Five years from now, for sure,and it's probably going to look
different in three years than itdoes in five or six, whatever
that ends up being Right.
There's like this interim stepand there's probably what it's
(30:00):
going to look like and thenultimately, probably 10 years,
probably looks even differentthan it does in five.
No-transcript.
That kind of overlaps with someof the things you guys are
(30:22):
doing.
There's the Alco piece with afactoring, which kind of
overlaps a bit with whatConvoy's been able to leverage
for trust verification, fraudprevention.
What are some of your thoughtsand I guess like even the near
term, and how maybe these thingswill be able to leverage each
other to be able to create morevalue across the platform.
Speaker 3 (30:40):
Yeah, it is week two and there's a lot of work to do,
but it's.
There's definitely a vision bywhich all this comes together
and you can start to think aboutthem as different, the
different capabilities in each,each segment.
There's a little bit of overlaparound the edges but you're
starting with Outgo factoringfinancial services and
capabilities around that.
We had payments built in but itreally didn't overlap at all
(31:02):
with what Outgo was building andalready I see huge benefits
just in engaging with that team.
They have such deep expertiseon factoring, on credit, on
underwriting capabilities thatjust shore up DAT top to bottom
in those those realms and as wethink about how we manage
payments, the payment optionsand how to expand that service
(31:22):
set, because certainly acrossthe broker portfolio everybody's
got slightly different.
Um, you know ways of managingtheir working capital or
thinking about going to marketand this will give us a lot of
optionality plus expertise, Iknow on my side and then across
tat.
So it's been uh fun engagingwith that team.
Um, trucker tools, more matureproducts already got a broader
(31:43):
install base.
It's got more white labelcapabilities in terms of
tracking and it's got more likeI'd say, services or additional
like points of interest andthings like that and
capabilities for truckers thatwould be interesting,
complementary capabilitieswithin the convoy app.
And then Convoy is reallyfocused on that end-to-end
execution and streamlining everypart of the load lifecycle,
(32:04):
because again, we came out of abroker.
It was a broker, it wasdog-fooded with a billion
dollars of investment, so it's avery refined execution.
I always I like to use the wordlike the label execution layer.
It's like an execution layercapability.
I mean it's in the hands of thecarriers managing every step of
their process and thenautomating that on behalf of the
broker to make it easier forthem.
So they're all.
(32:25):
They're complimentary in thatsense.
Yeah, they overlap around theedges and you know we are, you
know, actively working throughautomating what the end state
looks like and how the piecescome together.
But yeah, it's like the convois kind of the last piece of the
puzzle.
And the earlier question, likehow does this evolve over time?
I think I've had the fortune ofworking with some very
(32:45):
forward-thinking brokers thatengage in these products very
early, that wanted to learnabout them, wanted to try them,
some of whom I would say aremore farther down that path of
evolving into what a next stateof I would say are more farther
or farther down that path ofevolving into what a like next
state of broker looks like.
I'd say the golden use casewould be Uber, freight and
Convoy as they existed or asthey progressed as digital
(33:05):
brokers, which you know.
It's 80 to 98% plus of load asloads are automated from booking
to execution.
You have a small carrier teamthat's really managing around
the edges to execution.
You have a small carrier teamthat's really managing around
the edges, and those in the OPEXcan be a third or less of what
a traditional broker operates at.
(33:25):
So that, to me, is probably theend state.
I think there's always going tobe a mix because oftentimes the
limiting factor is how theshippers engage or what they
need, and then how that maps tothe capabilities of the broker,
and that's why you see a hugevariance in operating models of
how brokers go to market.
But I do think that procurementwill become more and more
automated and more focused backon the relationships, meaning
(33:46):
that a lot of brokers have verygood relationship with
mid-to-large carriers.
That tends to be the sweet spot, particularly those mid-sized
carriers where they have aparticular capability.
They understand theirgeographic footprint.
They under like the carrier repis building a deep relationship
with that carrier, knowsimmediately when loads hit the
board.
Is it going to be a good fitfor that carrier?
They're problem solving um some.
(34:07):
That's what I think becomesmore valuable from uh carrier
engagement.
But a lot of the puretransactional stuff just
continues to get automated awaybecause it's not just us, it's
also ai and other capabilitiescoming to market on the shipper
side.
I just it's a slower um uh pushin terms of how brokers engage
with shippers.
Shippers are always just alittle more conservative in how
they go to market um, and Ithink ultimately that like it's
(34:31):
still so relationship driven,because a lot of the variance
again in opex internally is alljust driven by how shippers want
to engage in their expectationsand their service expectations
or how they want to managethings on their end.
So I don't think that side isgoing to change as quickly.
I think the carrier side iswhere we're going to see the
change happen more quickly.
So it already has.
Speaker 1 (34:50):
Yeah question on the evolution because you know you,
you guys can create the greatestproduct out there, but there's
a reliance on integration withTMS.
There's a reliance onacceptance of the process and
the product from brokers andcarriers.
I'm curious, as you've I mean,you've been in this industry
long enough to see the evolutionhappen at light speed.
(35:11):
Do you feel that?
Is there any part of thatequation where someone's a
little bit behind the ballversus someone else, or
someone's a little bit too farahead?
You know what I'm saying islike, if you've got this great
product, are there TMS companiesthat are not ready for the
integration yet?
Or is adoption from the usernot ahead, or is it just kind of
(35:32):
?
Speaker 3 (35:33):
homogenous alignment.
The digital freight model ismodel has been popularized
enough in the marketplace thatall the TMSs at this point have
some solution for that, but it'snot the same as being ready for
what we're offering, because itusually focuses on the booking
and the matching piece of it,but not the full load execution.
But the rest of the process hasbeen built out and solved along
(35:54):
the way as well.
There's so many differenttracking solutions, so all those
APIs and capabilities are builtout.
I'd say that all TMSs thatwe've talked to are ready for
like phase one.
Phase one is basic loadmanagement, end to end.
To me, the next phase, though,is really about workflow
automation for the brokers andthinking about how to streamline
how they manage their day today, how they allocate loads to
(36:14):
carry reps.
It's like the tactical questions.
I know that X percent.
If I know that, I shouldprobably expect that 10% of my
loads are going to be booked offof inbounds, off DAT, 20% are
going to be booked via convoy,and then I need to focus on the
remaining 70%.
How do I focus that 70%?
What information do I need?
What tools do I need?
How do I need to think aboutthe load board management on a
(36:36):
day-to-day basis.
Also, as I'm going to market ifI'm going to bid on freight or
bid on a contract, how should Ithink about these other
capabilities and capacitychannels available to me and how
that balances against currentinternal capabilities?
So I think that's where you'llprobably see the bigger
differentiation of TMSs over thenext five years.
I think the base levelcapabilities the booking, the
(36:57):
load management, bidding allthat is kind of table stakes and
we're far enough along in thisdigitization freight journey
that every TMS knows they got toplay that game.
Yeah, what I think they are,what they'll have to come to the
table with over the next fiveyears, is that next level.
Like if I for my brokercustomers, how am I helping them
operate in a more digitallyforward model that allows them
(37:19):
to optimize their team and makesure that their team is being
utilized in the best way?
Speaker 1 (37:24):
Yeah, what's interesting about what you just
said there is, I think, back to.
I just went through a TMSevaluation for my brokerage this
year for an upgrade, and I didthe same thing about five years
ago year for an upgrade and Idid the same thing about five
years ago and I work.
So what I saw was availablefive years ago versus what is
available now, it is night andday.
A lot of the names are stillthe same, but what they're
(37:46):
actually focusing on is very,very different.
Like five years ago, a lot ofthe focus was, you know, some
automation, but a lot of it waswe're trying to get away from
the legacy system and get moreto the online, web-based.
It's accessible anywhere, it'seasy to use, it looks nice.
And now, five years later, it'slike well, that's the industry
normal now, like it should beeasy to, you know, easy to
(38:07):
access.
You could get it on your phoneor on online, whatever, from
anywhere.
And now it's like there's allthese other cool tools out there
.
We want to be able to integratewith them and leverage what
they're doing.
So it's, you know, our folkscan operate in one system but
leverage all the stuff that'sout there.
So it's really, really cool.
That's why I was curious.
If there's any TMS, you knowyou don't have to name any, but
(38:28):
if there's, like you know,mostly all of them are leaning
into this and they're bought in.
Or is there, is there a decentpercentage?
That's like we're just notthere yet or we don't really
want to do that.
Speaker 3 (38:38):
I can call out a few that we've got good
relationships with.
I touched on a few before Forlong tail brokers.
Ascend is one that I'm veryexcited about.
The launch it's natively builtin.
We've worked quite hand in hand.
Speaker 1 (38:50):
Tim's done a great job with keeping that always
ahead of what's coming in themarket.
Speaker 3 (38:54):
Yeah, like always ahead of what's coming in the
market.
Yeah, tim's a great guy, youknow we, the cloud, is the
biggest one.
We've got a great relationshipwith them.
I was recently at one of theirconferences where you know
they're already ahead of thegame on AI integrations and
other capabilities, and so, youknow, we're currently in the
process of pushing our firstfully certified release with
them.
So, more to come, more press tocome on that one.
(39:15):
But then, moving down the list,like you know, we just launched
Port Pro native integration.
We've got pretty much, I'd say,the top 10, some commercial
agreement or relationship withall of them, by which and
they're all at slightlydifferent phases, which dictated
both by their internal roadmapsand you know, as we've brought
stuff to market, and ourcustomer mix and what they're
(39:37):
asking for.
But yeah, I wouldn't saythere's any.
There may be, you know, withoutcalling anybody out, there may
be some of the more old school,old school ones that haven't
just haven't invested at thesame pace, that are kind of
slowly weeding out of the market, but I'd say by and large, by
pure load count, broker count,all the TMSs, because it's a
very competitive market as well.
(39:57):
So they don't want to be caughtout and I think, certainly with
us now coming on to DAT, andit's going to be a default
expectation from a broker tohave these capabilities.
So yeah, to your point, likethe I almost feel like they're
going to.
Speaker 1 (40:10):
Yeah, they're going to be forced to adopt, Like if
their customer wants something.
If they're smart and they run agood business, they're going to
listen to their customer Rightno-transcript.
Speaker 2 (40:49):
It was something Tim and I were actually talking
about two weeks ago was more tolike the larger, like, think
like load matching companies,right, the automations ones like
in the back, and like the two,then the teens, the.
Where they really found a fit,it seemed like, was with
contract freight, where time wasan advantage, meaning like if
you can predict where thecarrier is going to be and you
know the load's going to beavailable.
They worked very well.
But in the spot market theytend to be very unprofitable
(41:09):
because it's very hard todetermine how many trucks are
going to be there if you've gota shorter amount of time.
Right, and Tim was.
I think he actually putsomething on LinkedIn recently
about like just Uberspecifically, was it like they'd
been running at a lossconsistently?
Right, and I'm curious, likeyour thoughts between, like,
revenue growth and profitabilitywhere, like lots of other
(41:30):
brokers have looked at some ofthe very big models and said
they're basically just usingfunded money to drive rates down
right and at the end of the day, can they ever actually turn a
profit?
And is that an economicsituation?
Is that the timing of thefreight and the niche they're in
, or is it related to just thefreight market we've been in for
three and a half years of itbeing recessionary, where like
(41:52):
that may turn around justbecause of the current economic
situation.
Speaker 3 (41:56):
Like that may turn around just because of the
current economic situation.
Yeah, with both Uber Freightand Convoy, I think it's
important to understand thatthey both had or have.
I have not, like I don't.
I'm not at Uber Freight anymore, so I don't know the details,
but I certainly understood it aswe were as, as I was there,
there's a highly profitablebroker buried in a kind of
(42:17):
larger enterprise and a largertechnology company, and it was
true for Convoy as well thatthere was a.
You could have taken a veryprofitable chunk of business out
of that if you did not have,like, there were a lot of other
pieces around that which kind ofresulted in it being
unprofitable.
And this gets to.
I think one of the corechallenges in our space is to be
(42:39):
able to invest in technology atthat scale.
It can only be supported.
Speaker 1 (42:44):
Oh, I'm not the only one who has a dog that goes nuts
on the podcast.
All three of us have them.
Yes, welcome to the crew, billAmazon delivery driver.
Yeah, let me follow thatscrewdriver.
One of the things I'm curiouson is um, so with when, whenever
a broker, um, whenever there'san integration into into
someone's TMS?
(43:04):
Um, there's a certain group ofpeople who the first thing they
think is, like my data is notprotected, someone's going to
have access to all my customersinformation and loads and
they're going to steal it fromme.
Um, can you speak to the, theguess, the protection or how
that works, so that people wouldfeel at ease having their
customer's business and thatdata running through the convoy
(43:27):
platform?
Yeah, the same as for DAT.
If you're posting a load likeDAT, you can see who's posting
what load.
Do you know what I mean?
Speaker 3 (43:32):
Yeah, it's the same.
That's always my counterargument.
Yeah, in terms of, like,partitioning the data and how we
control that data, there are alot of protections within in the
contract, just legally, interms of how we manage that data
.
Uh, and beyond that, like weare not a um uh, we're not
engaging with the shippers.
Like we're not a broker, wedon't have any like, there's no
(43:52):
uh financial incentive ormotivation to use that in any
sort of like ant, likeanti-competitive way.
Internally.
Certainly it's a big part ofwhat we're trying to do is
position like be neutral,position ourselves as neutral.
Uh, we want, we're here for thebroker, we're building tech for
the broker.
So I would say it just, youknow, generally it's part of
doing business that at somelevel you've got to be able to
(44:14):
share the data by which you wantthe transactions to execute.
Beyond that, like we have, no,we don't see, as an example,
revenue.
We don't see shipper rates.
We only see the rates that theygive us for the buy side and
what they would want to set thatat.
Speaker 1 (44:30):
So we limit the data that we pull, to that that's
relevant for the transaction andto that note, and this is it's
slightly unrelated, but I thinkpeople that get afraid, because
I've heard people be like Idon't want them to even know,
like the number of customersthat I have or the number of
loads that I'm moving, and atthe end of the day, the way I
always see it is like there's alevel of data you need to share
to be able to have optimization.
(44:51):
And on top of that if you have agood relationship with a
customer who cares how manyloads you're moving with them
you know what I mean that.
That's the way I've alwayslooked with it.
If you do good business and youhave good partnerships, part of
you know, part of that businessrelationship is sharing some
sort of information with oneanother in a safe way.
Speaker 2 (45:08):
So yeah, I wanted to loop back to the one thing right
before your dog barked to.
Let you finish the thought,though, because I think you were
going down the line of thoughtof, like, if you've got to raise
enough capital to buildsomething that big and that
impactful, you need to have alarge enough portion of the
market to be able to repay itover a certain period of time.
Right, but what are your kindof thoughts on like?
Does that at some pointeconomically kind of fall back
(45:32):
out, or does it like there'sjust always going to be a
section of the market where,like, those are going to work
better, where the spot marketloads in the speed in which they
need to be negotiated andchange hands are going to be
more fit for like a part I meanliterally what you guys have
partnering with DAT well, notpartnering, but like bringing
those two things together to mefeels like you guys are now
starting to approach that spotmarket with the same value
(45:54):
proposition, without theeconomic disadvantage of locking
in the rate and then hoping youcan pay it later.
Yeah, exponentially larger,because now you're servicing
every one of the largebrokerages.
Back to that same customer, youadd up all their 10 percent of
that customer's freight.
If you get five or 10 of themor all those brokers now, you're
being able to service a muchlarger piece of that whole pie
(46:16):
and I think there was a lot oflessons learned in that.
I mean, there were a lot ofcompanies that I think tried to
do that in the 2020s, that youknow, two, three year range,
where you know, I think, theyjust weren't as constrained on
their cap table and, like yousaid, there's just only so much
of that market you're going tobe able to grab within a certain
amount of time and you justcan't repay it.
(46:41):
You just basically end updrowning and chasing a goal that
is unreachable with onebrokerage.
But when you spread it out now,all of a sudden, you can
actually leverage that valueacross a lot more of the market.
Speaker 1 (46:48):
Cool.
I mean anything else as we gettowards the tail end here,
anything like near future thatfolks can look forward to or
what's like, you know the shortterm 50 meter targets for for
this.
You know the acquisition hereversus you know what should we
expect three to five years fromnow?
You got your work cut out foryou, man.
It's exciting, though.
Awesome, ben, you got any otherquestions for Bill?
Speaker 2 (47:08):
I'm super looking forward to just really kind of
all these pieces that have cometogether.
I mean, from talking with Jeffearlier this year and like all
the acquisitions and just youcan kind of see how the pieces
are going to come together.
(47:29):
And even going back to, I mean,when we were talking with them
like two years ago on plans, onjust what they were doing,
starting to see the roadmap cometogether and to see the pieces
come into place, I think it'sgoing to be really exciting
seeing how all of these thingsfit together, because I think
there's a ton of value in howthe things can some in some ways
, oh it's, you know, it's likeeconomies of scale, the fact
that like you can add the oneand one and get three, or the
three to get five when you startpulling them together, where
one is able to help in the oneway that another one necessarily
(47:51):
wasn't necessarily designed tosolve that problem, like you
were saying, like alco andfactoring and how that's a part
of Convoy, but like that istheir focus, and being able to
leverage that value along withyours and along with the value
of, like some of the otherpieces.
I think it's going to be reallycool to see how it all comes
together.
I did want to ask one morething.
I mean, coming from Flexport,you excited to be back and
(48:12):
mostly in the domestic truckloadspace again, seeing it to come
to fruition.
Speaker 1 (48:17):
Full circle.
Speaker 2 (48:18):
That's awesome man.
Speaker 1 (48:19):
Well cool, bill.
Thanks for joining us on theshow.
I'm super excited to see howall this rolls out.
Any last things you'd want toadd in before we wrap up here?
Yeah, we'll throw your page inthe show notes here too.
So if anyone wants to connectwith Bill, definitely check out
show notes or the descriptionand you'll be able to connect
with them.
So thanks again for being onwith us, bill Ben.
Any final thoughts?
Speaker 2 (48:40):
Whether you believe you can or believe you can't,
you're right.
Speaker 1 (48:44):
And until next time my hard knocks boys, go Bills.
Welcome back.
It's another episode of theFreight360 podcast.
We've got a fun one today.
We've got a guest.
We're going to talk about somebig news that has happened
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You can go to Freight360.net ifyou'd like to find our
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(00:22):
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(00:44):
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And leave us that five-starreview.
We haven't run any reviews offin a while, but yeah, good stuff
.
All right, ben, anything new inSouth Florida today before we
introduce our guest.
Speaker 2 (01:04):
Yeah, just looking forward to winter.
That's about it.
Super hot, like it's been allsummer.
Speaker 1 (01:09):
All right.
Well, without further ado,we've got Bill Driegert with us.
Today we're going to talk aboutthe DAT acquisition of Convoy
and all the tech there.
Bill, welcome to the show,really quick.
For anyone who doesn't know,you, feel free and give a brief
rundown on you or yourbackground, current role, and
(01:30):
we'll dig all into.
Speaker 3 (01:30):
Convoy and DAT later on in the episode.
But feel free and give a quickintro.
Yeah, thanks for having me.
So I've been in this industrysince 2006.
I was fourth employee at CoyoteLogistics, spent about eight
years there, spent a coupleyears at Amazon and then was
co-founder of Uber Freight andspent about eight years building
that up, before going over toFlexport and having the
fortuitous opportunity toacquire the assets of Convoy as
that wound down and we, ofcourse, recently sold that to
(01:53):
DAT, which we'll talk abouttoday, and so now I'm EVP of
Convoy Platform over here at DAT, driving Convoy Platform within
the DAT ecosystem.
Speaker 1 (02:01):
Awesome and I'm super excited to dig into that.
Dat's had a massive 12 months.
I feel like we've talked aboutacquisition after acquisition
and just a lot of great productdevelopment.
So we'll get into the convoypart of it in a little bit here.
That is the big news, so we'regoing to skip over our news
portion today For a quick sportsroundup.
(02:22):
Ben, did you see the BuffaloBills are the Hard Knocks
preseason team they selectedthis year.
Speaker 2 (02:29):
I didn't.
Speaker 1 (02:30):
So I'm a diehard Bills fan.
Being here in Buffalo, I havenever watched Hard Knocks on HBO
.
Basically they follow teams.
They've evolved it over theyears.
It's been around for like acouple of decades, I think,
following teams throughout theseason.
But now they've got like followa team through training camp,
which the Bills are beingfeatured on right now, and they
follow another team during theseason and then another team
(02:50):
post offseason.
I guess is what they're doing.
But I went to training camp inRochester, new York, which is
like 75 miles east of Buffalo.
The Bills are like one of fiveor six teams that actually leave
their home facility fortraining camp.
The Bills are like one of fiveor six teams that actually leave
their home facility fortraining camp.
And then we went to on lastFriday they came back to Orchard
(03:16):
Park in Buffalo to do like a inour stadium scrimmage, you know
Bills versus Bills.
And we watched the firstepisode of Hard Knocks last
night when it dropped and theyhad like footage from like
literally last Friday in thatshow and I was like this is
insane.
It's really cool Cause I'm likeI wonder, as we watch the show,
if you know, my wife and I willmake a little cameo, I don't
know, but either way, if you'rea sports fan and your team is
featured, whether it's like.
You know, we talked with Steven, our producer, about having Joe
(03:38):
Burrow on the Netflixquarterback series this that
just dropped from last year'sseason like it's just fun to
follow your team through.
You know, obviously you knowhow the season ends, um, in
those shows.
But just get you pumped up likethis is, you know, training
camp and heading into preseasonthis weekend.
So I'm I'm super excited.
What do you think about thesteelers this year, ben?
Speaker 2 (03:58):
your boys.
I'm saying like cautiouslyoptimistic.
I mean like training campreports are saying that like
aaron rogers is really, I don'tknow, showing leadership
qualities.
I camp reports are saying thatlike Aaron Rodgers is really I
don't know, showing leadershipqualities.
I mean like the fact that likehe's spending time with like the
younger guys on the team.
There's lots of really goodpositive reports from like
almost all of the local media upin Pittsburgh.
So I mean it went from we don'twant this guy would rather him
(04:20):
not be here to immediately likethis warm welcome and it seems
like I don't know could bepretty optimistic.
Speaker 1 (04:27):
We'll see, you never know, man.
I know a bunch of Steelers fansthat were like, if we sign
Rodgers, I'm not going to followthe team anymore.
And I'm like, yeah, if you're adiehard fan, you're still going
to give it a week or two andBilly, you said you're not a big
sports guy, but you said you're.
I mean in the San Fran area,right?
Is there a lot of Niners fansout there?
Speaker 3 (04:44):
Oh, my son is a diehard Niners fan.
I actually grew up in Dallas.
My wife and her whole familyare big Cowboys fans.
Okay, definitely a bit of aNiners Cowboys, oh yeah.
Speaker 1 (04:53):
Oh yeah, very true.
Well, cool, good stuff.
We'll get right into it, bill.
So you came over to DAT.
I mean, this just happened.
What two weeks ago?
Speaker 3 (05:04):
It officially closed last Wednesday.
Speaker 1 (05:05):
So a week ago.
Speaker 3 (05:06):
The first full week, yeah.
Speaker 1 (05:09):
So take us through and then we'll, you know, we'll
dig into it a bit.
For the folks out there thatare listening to kind of paint
the picture of you know how thisall happened and what does it
mean.
Can you kind of set the stageon?
You know, I kind of want tohear more about you too.
I mean, your background's superimpressive, but how did, how
(05:29):
did the convoy platform you know, how did you feel about it and
how did it work for you in theyears past and how did
everything lead up to thisacquisition?
We'll start there.
Speaker 3 (05:39):
Yeah, I've known, I knew Dan pretty early in his
journey with the convoy platform.
I actually met him while I wasstill at Amazon in Seattle when
they were first starting offback in 2015 and 16.
And I always believed in theidea.
It's an idea that reallystarted coming to market in
2012-ish the idea of an Uber forfreight or using an app for
driver to manage freight.
(06:00):
It seems pretty obvious inretrospect and a lot of people
were converging on this ideaaround the same time, but there
weren't a lot of companies thathave the capital and capability
to really push it hard.
And Convoy I mean it came downto Convoy and Uber Freight there
from 2016 to 2020, reallypushing the market and going tit
for tat in terms of productfeatures and just pacing and
(06:22):
growth.
And so I was on the other sideof that because I helped
co-found Uber Freight inSeptember 2016.
Convoy originally launched alittle bit before us in 2015.
So they had a little bit of aheadstart, but we of course,
have the Uber brand name and thefact that Convoy was pacing
their all through that.
They always were leading withproduct, they always had
incredible product, they alwayshad an incredible team and, of
(06:44):
course, they got significantamount of investment and like
gold tier investment investorsthroughout the whole process.
So I was very familiar with itas a competitor and I knew that
they had built a very solidproduct.
I knew that carriers loved theproduct.
I knew the brokers the shippersat the time they worked with
loved what the service thatConvoy offered.
Well, then came the pandemic andlots of things changed.
(07:06):
Uber Freight became quite adifferent company.
We made a large acquisition ofTransPlace Convoy.
Ultimately, the end of thatstory was come 2023, they had to
shut the doors.
Unfortunately, we were able toengage with them very early,
Almost as soon as that happened,reached out to Dan, had a
conversation.
It was clear they had a veryshort window to make a decision
(07:28):
around what to do with thetechnology, because the bank was
effectively taking all theother assets and we had the
opportunity to buy thetechnology.
But it was no business.
We weren't buying a business,we were just buying the tech.
But myself and Ryan, CEO ofFlexport, were super bullish on
just the value of that tech andthat platform and because I was
(07:48):
incredibly familiar with it andhad built very similar
capabilities at Uber, I alsoknew that I was pretty confident
that we could take it and dosomething with it.
Speaker 1 (07:56):
Can you talk a little bit, because there's probably
people in our audience well,there's definitely people in our
audience that are new and maybedon't understand what an Uber
Freight does compared to atraditional brokerage model or
what the convoy technology does.
Can you just break that downBarney style to understand
specifically convoy what?
What is it?
What does it do?
Speaker 3 (08:16):
Yeah, both convoy and Uber Freight were very tech
forward, and I'd say convoy evenmore so in the scope of the
products they built out.
It really starts with adifferent operating model that
is app-centric on the carrierside and then, I'd say, building
up from there.
There was a significant amountof technology investment in all
sorts of different capabilitiesin Convoy, but I think the
(08:36):
pivotal piece that most peoplecenter on is this idea of
instant booking, app-centricbooking, and it's been highly
transformative for carriers andI think, fundamentally, the
carrier market has shifted as aresult over the last 10 years.
So if you put yourself in theshoes of an owner operator and
it's 2010 and you need to find aload or let's say you just got
(08:56):
your CDL how do you get started?
Right, there aren't.
It's a lot of just banging ondoors.
Hopefully you've got some goodrelationships.
Hopefully you've got previousshippers you worked with who you
can offer your services to, ormaybe there's other carriers you
can sign on with, but it's very, it's very unlikely that you
can just book a load the nextday and if you do that, you're
probably going to um, you knowDAT or a load board.
(09:17):
You're making phone calls.
There's a lot of frictioninvolved in that process and if
you're calling a broker, you'reoperating on broker hours, so
you're calling them at 6ambecause you're trying to be the
first one, first call they get,and that's just a very like
that's how it worked up untilreally these models came to
market.
So now today I'm an owneroperator, I can download an app,
I can book a load, I can juststart doing business.
I've heard hundreds of thesestories from carriers where they
(09:40):
said, yeah, I mean first day Igot my CDL.
Carriers where they said, yeah,I mean first day I got my CDL I
didn't have options.
Like now I've got options andit just allows me to be a lot
more, allows them to be a lotmore flexible and have access to
more freight and just managetheir business through the app.
So from a carrier perspective,they can book a load there, all
the tracking happens in the appand then they get paid and their
the payment can be one to twodays.
It's very like everything.
It's a consistent experienceacross a whole set of different
(10:03):
freight types.
From a broker perspective.
So because Uber Freight andConvoy went to market as brokers
and Uber Freight still is abroker Convoy is no longer a
broker.
We shifted away from that.
We decided this tech is great,let's give it to all brokers and
go to market that way.
But from a broker perspective,it's like a magic button.
It's like when a load justcomes off the board or gets
(10:25):
booked at 10 pm and you don'teven have to touch it or call a
carrier.
That's a magical experiencewhen it happens, but it's an
OPEX saver.
And to get there, though, everyelement of that load had to be
optimized and automated.
So, starting with the biddingand the pricing and allowing the
carrier to book itautomatically, all that had to
(10:47):
be built out.
Tracking very robust tracking.
These days, the phone in yourpocket has incredibly precise
GPS and tracking compliance isincredibly high.
Early on, when carriers firststarted using apps, they didn't
want to use them or the trackingwasn't great.
There were issues, but thoseare 10-year-old problems.
Today, carriers using apps.
They're highly compliant.
And then all the paymentssystem had to be built out Up
(11:08):
front.
All the one of the biginvestment areas for Convoy was
in fraud right, because ifyou're going to automate this
like, you've got to ensure thatyou've got very tight controls
in terms of who comes on boardand how we bring carriers
through the compliance process.
So.
Speaker 1 (11:22):
Ben, you know what this makes me think it was.
We go back probably to early on, and when me and you first were
getting into the brokerage side, I remember writing articles on
LinkedIn and like writingcomments when Uber, freight and
Convoy came out because peoplewere like they're going to
replace freight brokers and I'mlike, I'm like they're literally
acting as a brokerage.
They're just leveragingtechnology to do a way better
(11:44):
job and if they can really dothat, well, I think there's
something there and I always sawthe benefit of the technology
versus just trying to replace abroker as the more important
part.
Ben, do you remember when thisfirst stuff all came into
discussion?
Speaker 2 (11:58):
Very much so this is like the mid to later 20-teens.
Speaker 3 (12:02):
Yeah, yeah, there was a lot of anytime a new entrant
comes into market with so muchinvestment, so much media and
impressive attention, there wasa lot of counter narratives in
the market, yeah, and I thinkfundamentally there's a also.
I think, just if I'm a smallcarrier or a small broker and I
can't make that level ofinvestment, what does this mean
(12:26):
for me?
And I think that's also one ofthe things that's changed over
the last 10 years.
A lot of tech now is availableto most brokers and, like, with
us going to DAT, even more sonow they have access to this
capability.
But certainly there was a lot offear in that too, because,
having been at Coyote and havingbeen gone through a broker
startup, a lot of what we weredoing by the time we started
(12:49):
Uber Freight was just goingthrough our wish list, right,
just like automating everything.
That if we had had the budget,we had had the capability and
had had access to this manydevelopers like this is what
everybody would have wanted todo, right.
I think we also got a littlebit of pushback for that,
because I think in any industry,it's not always like the ideas
is a brand new, it's just abetter execution that the tech
has evolved.
You can just do it moreefficiently than you could
before, and if you can do itwith that level of investment,
(13:11):
you can just pace much fasterthan anybody else from a tech
investment perspective.
Speaker 2 (13:14):
I'm curious on the part that you were talking about
on, just like the from thedriver's perspective.
Right, so this is, it's goingall the way down to the driver
level, or to the VIN level, orpretty much that MC level
compliance insurance.
Speaker 3 (13:28):
Yeah, if a carrier is working with convoy platform,
the vast majority of thosecarriers are owner operators and
that's primarily to do with thefact that they have to use the
app to engage in book freight.
We do allow dispatchers midsizecarriers, but they still have
the driver has to manage theload through the application.
Loud dispatchers midsizecarriers, but they still have
the driver has to manage theload through the application.
There's a certain size carrierby which you know they may have
constraints around allowingtheir drivers to use the apps,
(13:50):
but generally that's theconstraint and for them too it's
a strong product market fitbecause they just don't have, as
the other options are not asseamless and easy to use.
So it's a preferred option.
But if you're an owner operatoror if you're on the app, we have
to know the driver, we know thedevice, like.
We know we have thatinformation.
We have a lot of richinformation about the users and
(14:11):
we know then too that like arethey.
You know we have all thelocation information so we can
their IP address, all the rest,all the other information.
So we have a lot of.
We do have driver level detailversus strictly carrier.
Now, if so, we have a lot of,we do have driver level detail
versus strictly carrier.
Now, if it's an owner operatorit's one of the same and so,
because we have such a largeowner operator population,
(14:31):
probably a huge percent of ourcarrier base, by capacity and by
count, is a driver and acarrier and it makes a lot of
sense, like we've talked aboutthis a lot.
Speaker 2 (14:37):
It's like, well, one, just how the whole carrier
market is like segmented, rightand like for owner ops like I
don't want to use the word likedisenfranchised, but like, okay,
you only have so many resourcesright as an owner op to be able
to, like you said, make phonecalls, talk to brokers,
negotiate different loads, right, like even if you're starting
early calling and going, okay,like this load looks good, but
(14:58):
then, okay, well, that load'sbooked.
Now I got to talk to the nextperson.
I got to talk to the nextperson, and then it's the other
uphill battle of like, okay, howlong is your MC history?
Can they verify it?
Do you have enough inspections,which I think were like old
school ways to prevent fraudthat are now probably not as
effective.
But we've always talked aboutthis as a sense that, like how
the industry tried to solve thatbasically created this giant
(15:22):
headwind for owner operatorsright, and for new trucking
company owners to where it'sjust like, okay, so you don't
have history.
Like, how do you start?
How do you gain thatcredibility?
And the reality is is if you'vegot visibility all the way down
to the insurance, the VIN leveland that driver on the tracking
side and specifically all theway through the payment side,
then at the very least, likethat mitigates so much of the
(15:43):
risk for the brokers to workwith those carriers.
that really wasn't solving thatproblem anyway, and it's
certainly not solving it thesedays.
Speaker 3 (15:50):
Yeah, and if I mean from a carrier experience, just
so much easier.
I often use the analogy of likepreviously that it was more
like Craigslist and this is morelike an Amazon, and it's like
somebody brought this up theother day.
They said, well, you know,there's other systems where you
can just book a load online now.
And I said, sure, but if youwent to Amazon and you just you
(16:13):
said, oh, I bought it.
And then they said, great, nowyou have to send a check to the
vendor and it'll show up.
It's the whole experience,right, it's the fact that it's
end-to-end and integrated too.
It just makes it that mucheasier, but also to your point
then lowers the risk becauseyou're controlling every step of
the process and you havevisibility through every step,
so there can't be any disconnectthrough that process.
Speaker 1 (16:34):
And there's so much risk to around that, the Amazon
impact or effect.
I think about how frictionlessthe experience is, which draws
people back in there, and thenthey just get so used to how
easy it is, and I kind of feellike that's the way this is
going, versus, like what yousaid if you order something
(16:54):
online, it's a great, you haveto send a check in.
Well, that's not quite asfrictionless as they made it out
to be originally.
So I'm curious the, the, so notnecessarily how Convoy's
platform operated in the past,but so, moving forward, how does
what's the broker's experiencegoing to be like with Convoy now
part of DAT?
What does that?
Speaker 3 (17:15):
like.
For us, the broker experiencereally centers around their tms.
So we have a series of tmspartnerships.
Uh, we have native integrations.
We just launched with the porttms.
We've got a great one.
Uh, coming to market with thesend tms, where we've got deep
integrations and relationshipswith these tms companies.
We have a broker portal.
A lot of that capability Iexpect we will integrate within
(17:37):
the core DAT system.
What Convoy, really, you know upfront, it is similar to a lot
of the other DFM providers inthat you're managing load state
bidding and all that.
But you have to integrate everystep of the transaction.
So we have to have deepintegrations with the TMS,
because for the TMS, theintention is that it should just
operate like a visible set ofhands, like another carrier rep,
(18:00):
and that really depends on usbeing integrated for booking,
for bidding, for load statemanagement, to tracking, to key
milestone updates, to paymentsand even payment approvals, and
all of that integrated in onesystem just makes it that much
easier.
So it's very TMS.
We have great partnerships withTMSs.
(18:21):
So from a broker perspective,it's a complimentary service.
Now it's a.
You know it's part of the DATpackage going forward as we
think about this as an ecosystem.
So I sign up with Convoyplatform.
If I have a TMS, that haspretty much worked with all the
TMSs at this point, but then weintegrate through the TMS.
(18:42):
Capabilities are slightlyvariant between TMSs so that
should all converge over time.
But yeah, it's as simple as itcan be.
As simple as you just post allyour loads, filter out the ones
that maybe don't work or thatyou want your floor to work, get
real-time feedback on expectedcost to cover probability of
coverage, see when those loadsare booked immediately in your
(19:03):
system off convoy.
You see the carrier.
You can automate the carrierapproval or the carrier approval
.
If you have additional stepsthat you want to take, you can
manually override that or managethat process.
Tracking is all automated.
Breadcrumb data is allautomated.
Anytime you can call thecarrier because you have all the
visibility.
They'll call you because that'swhat's showing in the app and
then payments are managedautomatically.
How?
Speaker 1 (19:23):
about that pricing, though?
Is it like you can put a rangein, or?
Yeah, brokers set the ranges.
Speaker 3 (19:29):
So brokers determine what range they want the price
to be in.
They can set an absolute maxpay that we will never pay above
because it's all programmatic.
It manages bidding activity.
So this is where there wassignificant investment and we've
got real-time ML models thatmanage this behind the scenes
that determine.
You know, are we going to haveregret if we don't take this bid
?
Is this bid within range?
(19:50):
There's a reserve price.
It's operating within for anygiven time.
Speaker 1 (19:53):
This reminds me of eBay early on and how, how great
that evolved everything Right.
Yeah, it's just way moreadvanced.
Speaker 3 (20:00):
Yeah, yeah, if I think back to early eBay, you
could do things like auto acceptcertain counter bids and it has
similar functionality, but it'sall automated on the backend
when, yeah, like, if you thinkof it on, yeah what?
(20:22):
Ebay is actually a good andinteresting case study because
something like 85% of all eBayis actually buy it now versus
bidding, and we have that option.
They can buy it now or they canput a bid and most carriers
choose to bid because they knowthat there's some bid range
above that.
Speaker 1 (20:31):
It's kind of just the operating model you just think
about, like Ben, think about howmuch time is spent at a
brokerage when someone's likeyou know carrier puts an offer
in and like they go on their TMSand like log a carrier offer
and then it might go to somebodyelse who then maybe the manager
has to approve it and it justtakes so many people and so much
time like that.
Speaker 3 (20:58):
That automation of that process just seems like
such a time saver to me.
Yeah, and you have to respond,uh, immediately, because I was
um, I was more inclined to want,like a buy it now, early on as
we were taking thesecapabilities to market.
But it's really, carriersprefer to bid, but only if you
give them a response like rightaway you can't have a bid, and
then it goes like off into theether and you come back 15
minutes later because you justget such dramatic fall off.
Yeah, it's got to be whilethey're in the app, while
they're looking, becauseotherwise they're going to go do
(21:20):
other things, find otheroptions, start calling people.
Speaker 2 (21:23):
I am curious about that that you bring that up,
like what does that look likefrom like a fall off percentage?
And again, like I'm curiouswhat that looks like even
internally, like across thenetwork, right?
So from the carrier'sperspective, right, like I'm
bidding on a few loads, I getaccepted from Nate's load, but
then do I see yours, if you giveme back the higher rate after
(21:46):
I've accepted him and because,like in a practical scenario,
like you know, think back toCoyote, like how we do this,
it's like okay, there's theethics of once you have given
that load and agreed, you aregiving them that freight, even
if you get to carry the callsand you know two minutes later
and gives you a better rate,right.
Like how does the system?
(22:06):
I guess kind of address thatfrom a practical standpoint.
Speaker 3 (22:09):
Yeah, that's why it's very important to respond to
the bid immediately and thenit's a yes, you know, yes, no,
so the carrier doesn't have toeven go out of the session to
get a response.
It's very critical for thesystem because you have the fall
off is dramatic and if you Imean I don't, I don't know the
exact numbers, but I would guessthat your success rate after an
hour to just recalling my timeat coyote, because I did look at
(22:30):
this data in detail back thenit's got to be 10 to 20 percent,
um for the bit, actually evenbeing alive, particularly in
your peak hours, because in a 6to 10 am like, if you try to go
to back to a bit at 1 pm, it'sjust it's not gonna be there,
right, yep, it's like 6 am and 8am, maybe because you're in
that window where people arelike parsing through options,
and I'm sure it's evolved evensince I back the days that I was
(22:51):
looking at that data.
But certainly I and again Idon't recall the exact numbers,
but I do know, like you know,convoy studied this quite
intently in terms of bidresponse and the fall off if you
don't respond immediately Nowthose bids do go and are visible
to brokers.
So if this is where there's alittle bit of learning, when a
broker comes onto the platform,just how does it react, how the
(23:12):
bids come in?
Because you know, the conceptof max pay or the maximum
willing to pay, varies very muchby broker and also it adjusts
with time.
And so how do you get ahead ofthat and say, okay, if you're
willing to pay a thousanddollars one hour out, like, we
will ramp the rate up for you.
We're not going to pay athousand two days out, we'll pay
, you know, 800 or whatever.
(23:32):
And how do we make thattransparent If a what we often
see is they can see the bids, sothey set the max pay at 800,
even though they really will payup to 1,000 if they have to.
And it's now six hours later andthe best bid is 850, but they
set it at 800.
Like, why didn't we take the850?
Well, it's because the systemis absolute right.
You got to control it.
(23:53):
As we're on the floor as we'reon the floor, you're often
having a conversation.
So your real max pay and it's.
It's funny because a lot oftms's have like max pay and then
they have like over max pay,yeah, absolute max pay, yeah,
like emergency pay, yeah, yeah,yeah exactly, and communicating
that concept programmatically,like the computer's gonna, the
algorithm's gonna just do whatit does.
(24:14):
So, yeah, so let me ask you howto use it on the back to like
the broker's use case.
Speaker 1 (24:19):
You mentioned TMS integrations.
Is that like an all or none oris there?
Can they operate?
Can a broker operate in theconvoy or DAT platform without a
TMS integration?
Speaker 3 (24:32):
No, it requires a TMS integration because it's core
to the experience.
Speaker 1 (24:36):
I figured it would.
I just was curious if there wasany way around that.
Speaker 3 (24:38):
Yeah, it's like the Amazon versus the other modes,
because we have to manage loadstate.
So to be able to manage thatsimultaneously.
What you don't want to is theidea is that brokers may be
working these loads Parallelhappens all the time.
If they're posting 100% oftheir freight, they've got a
floor, the floor is working inparallel.
They got a floor, a floorworking in parallel.
So if something, if they bookthat, we want to take it off the
app and vice versa.
So, like you need thoseintegrations.
(25:00):
And then for tracking,everybody has basic tracking
integrations these days in theirTMS.
You just want to upload thatdata.
Speaker 1 (25:07):
Got it, but the tracking is actually happening
through the convoy side of it.
Speaker 3 (25:12):
Is that correct?
Through the app?
Through the app, exactly Okay,got it.
Speaker 2 (25:16):
How is this like?
And it sounds like, I guesslike a very simple question, but
like once, so right now it'sstill technically two separate
products.
They're not integrated yet.
Correct Between being able touse it through the TMS, through
DAT.
Is it still the standalone yet,or have you guys merged them
together?
Speaker 3 (25:34):
They're two separate products.
They are very complementary.
They're definitely featuresthat will be integrated over
time and we'll bring togethercertainly a lot of the
investments in fraud and othercapabilities.
There's application acrossdifferent parts of the DAT
ecosystem.
But really think of it forConvoy.
It's loads that can beautomated, because not all loads
can be automated.
(25:54):
It's a today.
It's a smaller carrier poolbecause it goes through a
different compliance processOver time.
You know we'll integratedifferent capabilities across
both, but DAT is still thelargest load board, lets you do
anything.
It's got full features.
It's fully scoped.
Right, it's 47 years ofdevelopment and build up.
(26:14):
But clearly we expect thesethings.
You know we're going to benefiton both sides and the convoy
network will scale up.
But there's slightly differentuse cases.
You can think of it too, justin the way brokers use them.
Brokers tend to post loads assoon as they get them onto the
convoy platform, let it work inthe background.
Brokers are often using DAT tosource new capacity when they
need it or as they need it, andso a lot, most of pretty much
(26:39):
well every customer we havetoday that I'm aware of also had
a DAT when we went through thisprocess.
So and they use them incomplimentary ways, and
sometimes it's they've gotsimilar people managing the
postings or thinking about howto use them day to day, but it's
, they're very complimentary.
Speaker 2 (26:55):
So from the TMS point of view, from, like, the user
right Once that integration'sthere.
Now what it would look like isI'm basically deciding whether
or not I'm posting my loads toconvoy or to DAT, which will
eventually be one posting, ormaybe an option into one Cause.
We'll eventually be likecentralized under, obviously,
the one umbrella, correct?
Speaker 3 (27:16):
Correct and, as of today, there's more optionality
to post-loads on DAT.
It just covers a broader set ofservices and capabilities and
it's more flexible.
Load has to be well-formed toland on Convoy platform because
we're going to execute it.
We had to have all theinformation.
There can be some differencesthere, but yeah, practically, if
I was starting a broker todayand I was trying to build a tech
(27:39):
forward and highlysophisticated, I would probably
use those in the way that Iwould have most of my freight
posting on Convoy, also postingon DAT.
There's a lot of companies thathave stepped into the market too
to manage inbound calls in amore automated way off of DAT.
I think the market's going tolook.
You know it's fine to be on theinside because I do think this
is one of the pivotal changesthat's going to push through the
(28:00):
market in the next five to 10years.
Carrier procurement in generalis just going to become a lot
more tech driven in terms of howbrokers manage it and DAT just
has a legacy of depth andcoverage and scale and
capabilities and flexibility interms of how the product works
and on the convoy side it's allabout automation efficiency.
Speaker 1 (28:19):
So you mentioned there's some differences between
what's required to post to abasic posting on DAT versus
convoy.
Can you talk?
Because I'm thinking like if Iwant to post any old load on DAT
I'm looking at like origin,destination, equipment, type,
equipment right.
Speaker 3 (28:36):
Yeah, and the date, maybe not even wait.
You can imagine just the usecases at which you're doing that
.
There's a broader set of usecases in which you might post a
load to get it inbound.
Speaker 1 (28:45):
What does that narrower scope look like for
convo With?
Speaker 3 (28:47):
convo.
It's the actual load, right,we're pulling it out of your TMS
scheduled.
Right, it's ready to go.
We've got the pickup location,delivery location, the schedule,
like all the.
Speaker 1 (28:57):
Down to the address.
You got the price range inthere.
Is there limitations onequipment types?
Speaker 3 (29:02):
You can imagine.
I mean, there are definitely alot of operating models in terms
of how brokers manage loads orget freight from their carriers
that support a DAT-like approach, where you just need a little
more flexibility and the loadhas to be automatable.
It has to be a little morerigorous, uh coming through the
(29:24):
convoy platform.
Okay, any limitations onequipment like is it specialized
?
Drive, flatbed and reefer, anddon't do like we don't have the
full scope of specialized interms of uh flatbed as we're on,
you know dat it's pretty muchwhatever.
Like we, it's a, it's a fullybroad set of services got it
cool.
Speaker 1 (29:36):
so what do you go ahead, Ben?
I'll ask some questions inlater.
Speaker 2 (29:40):
What do you kind of see, like what this is going to
look like?
And I would say like probablyin the interim, because I think
you alluded to a minute ago I'mlike I don't think most people
think the industry is going tofunction the way it does today
Five years from now, for sure,and it's probably going to look
different in three years than itdoes in five or six, whatever
that ends up being Right.
There's like this interim stepand there's probably what it's
(30:00):
going to look like and thenultimately, probably 10 years,
probably looks even differentthan it does in five.
No-transcript.
That kind of overlaps with someof the things you guys are
(30:22):
doing.
There's the Alco piece with afactoring, which kind of
overlaps a bit with whatConvoy's been able to leverage
for trust verification, fraudprevention.
What are some of your thoughtsand I guess like even the near
term, and how maybe these thingswill be able to leverage each
other to be able to create morevalue across the platform.
Speaker 3 (30:40):
Yeah, it is week two and there's a lot of work to do,
but it's.
There's definitely a vision bywhich all this comes together
and you can start to think aboutthem as different, the
different capabilities in each,each segment.
There's a little bit of overlaparound the edges but you're
starting with Outgo factoringfinancial services and
capabilities around that.
We had payments built in but itreally didn't overlap at all
(31:02):
with what Outgo was building andalready I see huge benefits
just in engaging with that team.
They have such deep expertiseon factoring, on credit, on
underwriting capabilities thatjust shore up DAT top to bottom
in those those realms and as wethink about how we manage
payments, the payment optionsand how to expand that service
(31:22):
set, because certainly acrossthe broker portfolio everybody's
got slightly different.
Um, you know ways of managingtheir working capital or
thinking about going to marketand this will give us a lot of
optionality plus expertise, Iknow on my side and then across
tat.
So it's been uh fun engagingwith that team.
Um, trucker tools, more matureproducts already got a broader
(31:43):
install base.
It's got more white labelcapabilities in terms of
tracking and it's got more likeI'd say, services or additional
like points of interest andthings like that and
capabilities for truckers thatwould be interesting,
complementary capabilitieswithin the convoy app.
And then Convoy is reallyfocused on that end-to-end
execution and streamlining everypart of the load lifecycle,
(32:04):
because again, we came out of abroker.
It was a broker, it wasdog-fooded with a billion
dollars of investment, so it's avery refined execution.
I always I like to use the wordlike the label execution layer.
It's like an execution layercapability.
I mean it's in the hands of thecarriers managing every step of
their process and thenautomating that on behalf of the
broker to make it easier forthem.
So they're all.
(32:25):
They're complimentary in thatsense.
Yeah, they overlap around theedges and you know we are, you
know, actively working throughautomating what the end state
looks like and how the piecescome together.
But yeah, it's like the convois kind of the last piece of the
puzzle.
And the earlier question, likehow does this evolve over time?
I think I've had the fortune ofworking with some very
(32:45):
forward-thinking brokers thatengage in these products very
early, that wanted to learnabout them, wanted to try them,
some of whom I would say aremore farther down that path of
evolving into what a next stateof I would say are more farther
or farther down that path ofevolving into what a like next
state of broker looks like.
I'd say the golden use casewould be Uber, freight and
Convoy as they existed or asthey progressed as digital
(33:05):
brokers, which you know.
It's 80 to 98% plus of load asloads are automated from booking
to execution.
You have a small carrier teamthat's really managing around
the edges to execution.
You have a small carrier teamthat's really managing around
the edges, and those in the OPEXcan be a third or less of what
a traditional broker operates at.
(33:25):
So that, to me, is probably theend state.
I think there's always going tobe a mix because oftentimes the
limiting factor is how theshippers engage or what they
need, and then how that maps tothe capabilities of the broker,
and that's why you see a hugevariance in operating models of
how brokers go to market.
But I do think that procurementwill become more and more
automated and more focused backon the relationships, meaning
(33:46):
that a lot of brokers have verygood relationship with
mid-to-large carriers.
That tends to be the sweet spot, particularly those mid-sized
carriers where they have aparticular capability.
They understand theirgeographic footprint.
They under like the carrier repis building a deep relationship
with that carrier, knowsimmediately when loads hit the
board.
Is it going to be a good fitfor that carrier?
They're problem solving um some.
(34:07):
That's what I think becomesmore valuable from uh carrier
engagement.
But a lot of the puretransactional stuff just
continues to get automated awaybecause it's not just us, it's
also ai and other capabilitiescoming to market on the shipper
side.
I just it's a slower um uh pushin terms of how brokers engage
with shippers.
Shippers are always just alittle more conservative in how
they go to market um, and Ithink ultimately that like it's
(34:31):
still so relationship driven,because a lot of the variance
again in opex internally is alljust driven by how shippers want
to engage in their expectationsand their service expectations
or how they want to managethings on their end.
So I don't think that side isgoing to change as quickly.
I think the carrier side iswhere we're going to see the
change happen more quickly.
So it already has.
Speaker 1 (34:50):
Yeah question on the evolution because you know you,
you guys can create the greatestproduct out there, but there's
a reliance on integration withTMS.
There's a reliance onacceptance of the process and
the product from brokers andcarriers.
I'm curious, as you've I mean,you've been in this industry
long enough to see the evolutionhappen at light speed.
(35:11):
Do you feel that?
Is there any part of thatequation where someone's a
little bit behind the ballversus someone else, or
someone's a little bit too farahead?
You know what I'm saying islike, if you've got this great
product, are there TMS companiesthat are not ready for the
integration yet?
Or is adoption from the usernot ahead, or is it just kind of
(35:32):
?
Speaker 3 (35:33):
homogenous alignment.
The digital freight model ismodel has been popularized
enough in the marketplace thatall the TMSs at this point have
some solution for that, but it'snot the same as being ready for
what we're offering, because itusually focuses on the booking
and the matching piece of it,but not the full load execution.
But the rest of the process hasbeen built out and solved along
(35:54):
the way as well.
There's so many differenttracking solutions, so all those
APIs and capabilities are builtout.
I'd say that all TMSs thatwe've talked to are ready for
like phase one.
Phase one is basic loadmanagement, end to end.
To me, the next phase, though,is really about workflow
automation for the brokers andthinking about how to streamline
how they manage their day today, how they allocate loads to
(36:14):
carry reps.
It's like the tactical questions.
I know that X percent.
If I know that, I shouldprobably expect that 10% of my
loads are going to be booked offof inbounds, off DAT, 20% are
going to be booked via convoy,and then I need to focus on the
remaining 70%.
How do I focus that 70%?
What information do I need?
What tools do I need?
How do I need to think aboutthe load board management on a
(36:36):
day-to-day basis.
Also, as I'm going to market ifI'm going to bid on freight or
bid on a contract, how should Ithink about these other
capabilities and capacitychannels available to me and how
that balances against currentinternal capabilities?
So I think that's where you'llprobably see the bigger
differentiation of TMSs over thenext five years.
I think the base levelcapabilities the booking, the
(36:57):
load management, bidding allthat is kind of table stakes and
we're far enough along in thisdigitization freight journey
that every TMS knows they got toplay that game.
Yeah, what I think they are,what they'll have to come to the
table with over the next fiveyears, is that next level.
Like if I for my brokercustomers, how am I helping them
operate in a more digitallyforward model that allows them
(37:19):
to optimize their team and makesure that their team is being
utilized in the best way?
Speaker 1 (37:24):
Yeah, what's interesting about what you just
said there is, I think, back to.
I just went through a TMSevaluation for my brokerage this
year for an upgrade, and I didthe same thing about five years
ago year for an upgrade and Idid the same thing about five
years ago and I work.
So what I saw was availablefive years ago versus what is
available now, it is night andday.
A lot of the names are stillthe same, but what they're
(37:46):
actually focusing on is very,very different.
Like five years ago, a lot ofthe focus was, you know, some
automation, but a lot of it waswe're trying to get away from
the legacy system and get moreto the online, web-based.
It's accessible anywhere, it'seasy to use, it looks nice.
And now, five years later, it'slike well, that's the industry
normal now, like it should beeasy to, you know, easy to
(38:07):
access.
You could get it on your phoneor on online, whatever, from
anywhere.
And now it's like there's allthese other cool tools out there
.
We want to be able to integratewith them and leverage what
they're doing.
So it's, you know, our folkscan operate in one system but
leverage all the stuff that'sout there.
So it's really, really cool.
That's why I was curious.
If there's any TMS, you knowyou don't have to name any, but
(38:28):
if there's, like you know,mostly all of them are leaning
into this and they're bought in.
Or is there, is there a decentpercentage?
That's like we're just notthere yet or we don't really
want to do that.
Speaker 3 (38:38):
I can call out a few that we've got good
relationships with.
I touched on a few before Forlong tail brokers.
Ascend is one that I'm veryexcited about.
The launch it's natively builtin.
We've worked quite hand in hand.
Speaker 1 (38:50):
Tim's done a great job with keeping that always
ahead of what's coming in themarket.
Speaker 3 (38:54):
Yeah, like always ahead of what's coming in the
market.
Yeah, tim's a great guy, youknow we, the cloud, is the
biggest one.
We've got a great relationshipwith them.
I was recently at one of theirconferences where you know
they're already ahead of thegame on AI integrations and
other capabilities, and so, youknow, we're currently in the
process of pushing our firstfully certified release with
them.
So, more to come, more press tocome on that one.
(39:15):
But then, moving down the list,like you know, we just launched
Port Pro native integration.
We've got pretty much, I'd say,the top 10, some commercial
agreement or relationship withall of them, by which and
they're all at slightlydifferent phases, which dictated
both by their internal roadmapsand you know, as we've brought
stuff to market, and ourcustomer mix and what they're
(39:37):
asking for.
But yeah, I wouldn't saythere's any.
There may be, you know, withoutcalling anybody out, there may
be some of the more old school,old school ones that haven't
just haven't invested at thesame pace, that are kind of
slowly weeding out of the market, but I'd say by and large, by
pure load count, broker count,all the TMSs, because it's a
very competitive market as well.
(39:57):
So they don't want to be caughtout and I think, certainly with
us now coming on to DAT, andit's going to be a default
expectation from a broker tohave these capabilities.
So yeah, to your point, likethe I almost feel like they're
going to.
Speaker 1 (40:10):
Yeah, they're going to be forced to adopt, Like if
their customer wants something.
If they're smart and they run agood business, they're going to
listen to their customer Rightno-transcript.
Speaker 2 (40:49):
It was something Tim and I were actually talking
about two weeks ago was more tolike the larger, like, think
like load matching companies,right, the automations ones like
in the back, and like the two,then the teens, the.
Where they really found a fit,it seemed like, was with
contract freight, where time wasan advantage, meaning like if
you can predict where thecarrier is going to be and you
know the load's going to beavailable.
They worked very well.
But in the spot market theytend to be very unprofitable
(41:09):
because it's very hard todetermine how many trucks are
going to be there if you've gota shorter amount of time.
Right, and Tim was.
I think he actually putsomething on LinkedIn recently
about like just Uberspecifically, was it like they'd
been running at a lossconsistently?
Right, and I'm curious, likeyour thoughts between, like,
revenue growth and profitabilitywhere, like lots of other
(41:30):
brokers have looked at some ofthe very big models and said
they're basically just usingfunded money to drive rates down
right and at the end of the day, can they ever actually turn a
profit?
And is that an economicsituation?
Is that the timing of thefreight and the niche they're in
, or is it related to just thefreight market we've been in for
three and a half years of itbeing recessionary, where like
(41:52):
that may turn around justbecause of the current economic
situation.
Speaker 3 (41:56):
Like that may turn around just because of the
current economic situation.
Yeah, with both Uber Freightand Convoy, I think it's
important to understand thatthey both had or have.
I have not, like I don't.
I'm not at Uber Freight anymore, so I don't know the details,
but I certainly understood it aswe were as, as I was there,
there's a highly profitablebroker buried in a kind of
(42:17):
larger enterprise and a largertechnology company, and it was
true for Convoy as well thatthere was a.
You could have taken a veryprofitable chunk of business out
of that if you did not have,like, there were a lot of other
pieces around that which kind ofresulted in it being
unprofitable.
And this gets to.
I think one of the corechallenges in our space is to be
(42:39):
able to invest in technology atthat scale.
It can only be supported.
Speaker 1 (42:44):
Oh, I'm not the only one who has a dog that goes nuts
on the podcast.
All three of us have them.
Yes, welcome to the crew, billAmazon delivery driver.
Yeah, let me follow thatscrewdriver.
One of the things I'm curiouson is um, so with when, whenever
a broker, um, whenever there'san integration into into
someone's TMS?
(43:04):
Um, there's a certain group ofpeople who the first thing they
think is, like my data is notprotected, someone's going to
have access to all my customersinformation and loads and
they're going to steal it fromme.
Um, can you speak to the, theguess, the protection or how
that works, so that people wouldfeel at ease having their
customer's business and thatdata running through the convoy
(43:27):
platform?
Yeah, the same as for DAT.
If you're posting a load likeDAT, you can see who's posting
what load.
Do you know what I mean?
Speaker 3 (43:32):
Yeah, it's the same.
That's always my counterargument.
Yeah, in terms of, like,partitioning the data and how we
control that data, there are alot of protections within in the
contract, just legally, interms of how we manage that data
.
Uh, and beyond that, like weare not a um uh, we're not
engaging with the shippers.
Like we're not a broker, wedon't have any like, there's no
(43:52):
uh financial incentive ormotivation to use that in any
sort of like ant, likeanti-competitive way.
Internally.
Certainly it's a big part ofwhat we're trying to do is
position like be neutral,position ourselves as neutral.
Uh, we want, we're here for thebroker, we're building tech for
the broker.
So I would say it just, youknow, generally it's part of
doing business that at somelevel you've got to be able to
(44:14):
share the data by which you wantthe transactions to execute.
Beyond that, like we have, no,we don't see, as an example,
revenue.
We don't see shipper rates.
We only see the rates that theygive us for the buy side and
what they would want to set thatat.
Speaker 1 (44:30):
So we limit the data that we pull, to that that's
relevant for the transaction andto that note, and this is it's
slightly unrelated, but I thinkpeople that get afraid, because
I've heard people be like Idon't want them to even know,
like the number of customersthat I have or the number of
loads that I'm moving, and atthe end of the day, the way I
always see it is like there's alevel of data you need to share
to be able to have optimization.
(44:51):
And on top of that if you have agood relationship with a
customer who cares how manyloads you're moving with them
you know what I mean that.
That's the way I've alwayslooked with it.
If you do good business and youhave good partnerships, part of
you know, part of that businessrelationship is sharing some
sort of information with oneanother in a safe way.
Speaker 2 (45:08):
So yeah, I wanted to loop back to the one thing right
before your dog barked to.
Let you finish the thought,though, because I think you were
going down the line of thoughtof, like, if you've got to raise
enough capital to buildsomething that big and that
impactful, you need to have alarge enough portion of the
market to be able to repay itover a certain period of time.
Right, but what are your kindof thoughts on like?
Does that at some pointeconomically kind of fall back
(45:32):
out, or does it like there'sjust always going to be a
section of the market where,like, those are going to work
better, where the spot marketloads in the speed in which they
need to be negotiated andchange hands are going to be
more fit for like a part I meanliterally what you guys have
partnering with DAT well, notpartnering, but like bringing
those two things together to mefeels like you guys are now
starting to approach that spotmarket with the same value
(45:54):
proposition, without theeconomic disadvantage of locking
in the rate and then hoping youcan pay it later.
Yeah, exponentially larger,because now you're servicing
every one of the largebrokerages.
Back to that same customer, youadd up all their 10 percent of
that customer's freight.
If you get five or 10 of themor all those brokers now, you're
being able to service a muchlarger piece of that whole pie
(46:16):
and I think there was a lot oflessons learned in that.
I mean, there were a lot ofcompanies that I think tried to
do that in the 2020s, that youknow, two, three year range,
where you know, I think, theyjust weren't as constrained on
their cap table and, like yousaid, there's just only so much
of that market you're going tobe able to grab within a certain
amount of time and you justcan't repay it.
(46:41):
You just basically end updrowning and chasing a goal that
is unreachable with onebrokerage.
But when you spread it out now,all of a sudden, you can
actually leverage that valueacross a lot more of the market.
Speaker 1 (46:48):
Cool.
I mean anything else as we gettowards the tail end here,
anything like near future thatfolks can look forward to or
what's like, you know the shortterm 50 meter targets for for
this.
You know the acquisition hereversus you know what should we
expect three to five years fromnow?
You got your work cut out foryou, man.
It's exciting, though.
Awesome, ben, you got any otherquestions for Bill?
Speaker 2 (47:08):
I'm super looking forward to just really kind of
all these pieces that have cometogether.
I mean, from talking with Jeffearlier this year and like all
the acquisitions and just youcan kind of see how the pieces
are going to come together.
(47:29):
And even going back to, I mean,when we were talking with them
like two years ago on plans, onjust what they were doing,
starting to see the roadmap cometogether and to see the pieces
come into place, I think it'sgoing to be really exciting
seeing how all of these thingsfit together, because I think
there's a ton of value in howthe things can some in some ways
, oh it's, you know, it's likeeconomies of scale, the fact
that like you can add the oneand one and get three, or the
three to get five when you startpulling them together, where
one is able to help in the oneway that another one necessarily
(47:51):
wasn't necessarily designed tosolve that problem, like you
were saying, like alco andfactoring and how that's a part
of Convoy, but like that istheir focus, and being able to
leverage that value along withyours and along with the value
of, like some of the otherpieces.
I think it's going to be reallycool to see how it all comes
together.
I did want to ask one morething.
I mean, coming from Flexport,you excited to be back and
(48:12):
mostly in the domestic truckloadspace again, seeing it to come
to fruition.
Speaker 1 (48:17):
Full circle.
Speaker 2 (48:18):
That's awesome man.
Speaker 1 (48:19):
Well cool, bill.
Thanks for joining us on theshow.
I'm super excited to see howall this rolls out.
Any last things you'd want toadd in before we wrap up here?
Yeah, we'll throw your page inthe show notes here too.
So if anyone wants to connectwith Bill, definitely check out
show notes or the descriptionand you'll be able to connect
with them.
So thanks again for being onwith us, bill Ben.
Any final thoughts?
Speaker 2 (48:40):
Whether you believe you can or believe you can't,
you're right.
Speaker 1 (48:44):
And until next time my hard knocks boys, go Bills.
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