The Future of Freight Payments: Outgo and DAT | Episode 296

In this episode of Freight 360, we’re joined by Ken Adamo, Chief of Analytics at DAT, and Marcus Womack, CEO and Co-founder of Outgo, to break down the current freight market and DAT’s recent acquisition of Outgo. We discuss how this move enhances payment speed, transparency, and financial control for carriers. Topics include challenges like capacity constraints and high operating costs, plus how Outgo’s tech simplifies back-office operations and factoring. We also explore fraud prevention, the importance of transparency, and what’s needed for a demand-driven market recovery.

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Episode Transcript

Speaker 1 (00:00):
Welcome back for another episode of the
Freight360 podcast.
We have a special one today.
We've got some of our friendsfrom DAT and Outgo, which we'll
talk about here in just a littlebit Big news there.
But if you are brand new,you've got a whole library of
content episodes, youtube videos, blogs all on our website at

(00:24):
Freight360.net, or just go rightto YouTube and look us up there
.
You'll also find a bunch ofdownloadable products some
little helper guides, dispatchchecklists, produce calendar,
some model contracts.
You've got the Freight BrokerBasics course if you're looking
for training material for you oryour team, so make sure to

(00:47):
check that out.
Share this with your friends.
Do the whole like, subscribe.
Comment on YouTube.
We've gotten some interestingcomments on the YouTubes lately,
so send them our way.
Whether they're love or hate,it helps the algorithm, so we
appreciate it.
Ben, what's happening inFlorida today?
Man?
Anything good.

Speaker 2 (01:06):
Nothing too terribly interesting.
Nice long weekend for MemorialDay Watched a little bit of the
Indy 500.
Didn't watch the end of it.
Watched actually quite a bit ofthe French Open and I've never
actually watched that muchtennis, but my daughter and I
starting to play this year Iwatched quite a bit of it.
It was actually prettyenjoyable.

Speaker 1 (01:22):
Nice.
Well, hey, we've got Marcusfrom Outgo joining us and Ken
from DAT, who's been on numeroustimes.
So, ken, you've introducedyourself enough times and you've
got quite the X following.
So people know you.
But, marcus, we haven't had youon the show before.
So if you don't mind, just realquick tell us.
You know the audience, who youare, what you do, and we'll get

(01:44):
into the whole story about thisbig news in today's episode.
But just a real quickbackground.

Speaker 3 (01:49):
Awesome, well, great to be here.
Thank you, nate, thanks Ben,awesome to be here.
So I'm I'm a CEO and co-founderof Outgo.
Outgo is a fintech andfactoring company in the freight
space, and so we were justacquired by DAT just about seven
days ago maybe, I guess, a weekand a half.

(02:10):
So we started Outgo five yearsago to transform how carriers
get paid.
You know they care aboutfinding work and getting paid,
and we saw an opportunity toreally transform the back office
suite and financial services tohelp them run their business
more profitably and efficiently.

Speaker 1 (02:29):
Awesome, we'll appreciate it.
Well, we're going to get intothat exciting news and the whole
story behind that in a littlebit here.
Ken, what's the latest with you, man?
What?
First of all, congrats to theOhio State University big dub
earlier this year.

Speaker 4 (02:44):
Yeah yeah.
It was pretty, pretty awesome.
We got to go to the tennesseegame.
I took my boy to the tennesseenight game and froze our butts
off, but probably the bestsporting event um I've ever been
.
Previously that would have beenwhen we beat the patriots as a
stealer fan and the afcchampionship game.
There you go, but this, thiswas a different level, being in

(03:05):
a college stadium at night inthe week before christmas nice.

Speaker 1 (03:09):
Um.
Well, on the.
On the topic of uh sports,we'll just hit on it real quick.
Um, I know we're not in uh nflseason yet, but as a buffalo
bills fan, it's really, it's.
It's funny.
So they're they're doing aHallmark movie about the Bills.
It's coming out this Christmas.
So I think they did it with theChiefs last year, but they

(03:30):
filmed it this past weekend, solike I think it was like the
Saturday before Memorial Day orFriday and Saturday.
So they took like 2000 fans asextras, packed them in a couple
of the sections at HighmarkStadium in Orchard Park and it's
they had to make it look likeit's a late december game in the
snow, so like everyone'sdressed up in uh like winter

(03:51):
gear and everything, butironically it happened to be
like 40 degrees and cloudy inbuffalo um in late may.
So, uh, I guess it worked outin their favor.
But, yeah, you, you can see uh,you can see the bill.
I think there's like fiveplayers from the bills that'll.
They'll be featured in themovie, um, but it's some
hallmark love story.
So, in other news, in buffalosports, the uh, if you're a

(04:13):
lacrosse fan, uh, my buffalobandits just won their I think
third straight nationalchampionship this past weekend.
So um way to go bandits.
Indoor lacrosse is like wildly,uh, entertaining to go to.
If you're like if yourosse islike wildly entertaining to go
to.
If you're like if you don'tfollow the sport, you just go
and there's pumping music thewhole time and playing lacrosse,
so yeah.

Speaker 4 (04:32):
EA released the cover athletes for the NCAA game
today.
Oh who we got Jeremiah Smithfor the Ohio State University
and Ryan Williams from AlabamaNice.

Speaker 1 (04:47):
I did not catch that one.

Speaker 4 (04:49):
When's the?

Speaker 1 (04:49):
game coming up.

Speaker 4 (04:52):
I don't know.
I might pick up a copy just toput on the wall, because I think
the extended version has RyanDay and Caleb Williams on too,
but I'm assuming it releases inthe next month or two.

Speaker 1 (05:04):
Yeah, let's see.
Oh yeah, here it is EA CollegeSports Football 26.
Ben, what do we got?
Anything like golf or any othergood sport.
You said the Indy 500, right?

Speaker 2 (05:17):
Indy 500, I didn't see the end and I don't actually
know who finished, and I waswatching some of the French Open
, but that's not over, I don'tthink until like next weekend.
It's like what is that Tennis?

Speaker 1 (05:26):
Yeah, tennis on clay.

Speaker 2 (05:30):
Tennis on clay, so it's like Roland Garros is the
one, the French Open, then theyhave the Australian Open,
wimbledon and then US Open, likethe four big tournaments Gotcha
.
It was pretty cool, though,because Nadal, I guess, retired
this is his first year notplaying and he won 14 of them
there, which is like insane.
I mean like I think the nextperson had won like two or three

(05:50):
, and he's won there 14 timesover his career, so like Monster
on clay.
Wow, Insane.
I was curious, Ken.
What do you think?
I think Aaron Rodgers is goingto end up at the Steelers.

Speaker 4 (06:01):
I mean, I hope not.
I think they should give WillHoward a chance.

Speaker 2 (06:04):
Yeah everybody in Pittsburgh.

Speaker 3 (06:06):
I hope so.

Speaker 4 (06:07):
And get Will Howard a chance and then, if he doesn't
pan out, you draft Arch Manningor Nussmeier out of LSU.
The problem with Steelers fansI belong to two of the most
entitled fan bases in the worldBecause Steelers fans like they
need to just go like 2-15 oneyear and get a quarterback.

Speaker 1 (06:25):
You guys are stuck in purgatory right now.

Speaker 4 (06:28):
You're like making playoffs but not getting draft
picks Tomlin, going 9-8 and thengetting just obliterated by the
Chiefs in the first round ofthe playoffs is like not, I
think, like the standard.

Speaker 3 (06:38):
But you have DK Metcalf now.
You have DK Metcalf now.

Speaker 2 (06:42):
Yeah he's the only receiver.

Speaker 4 (06:43):
We have on the roster .

Speaker 2 (06:45):
Got rid of Pickens.

Speaker 4 (06:47):
They're trying to get Chris Olave, which then you'd
have Olave, jack Sawyer and WillHoward.
I don't know, I mean they'llprobably still be second in the
division, but I think theprospects are better for the
Buckeyes this year than theSteelers.
That's my bold prediction ontoday's show.

Speaker 3 (07:04):
It's like every year, the Steelers.
That's my bold prediction ontoday's show.

Speaker 4 (07:06):
It's like every year.
Well, yeah, there's a few yearswhere the Steelers Remember.
The Steelers were great in mylifetime.
The Steelers were great duringthe middle of the Trestle era
where the Buckeyes were kind ofmiddling about a little bit.

Speaker 1 (07:16):
Yeah, interesting.
Well, we'll see.
I was talking about it with mywife earlier, like we're already
planning like when to take ourkids to like kids day for
preseason and I'm like man, it'slike only a little over two
months away from being back inthe stadium, so it'll be here
before we know it.

(07:36):
They will.
I like to try and enjoy the thefew summer months that we get.

Speaker 4 (07:49):
I'm sure, ken, you're in the same boat.
You know you're in Ohio, right?
Are you in Akron?
Yeah, I am.
This is the worst.
It's been bad weather since theday after Thanksgiving, I'm not
kidding Like it's been theworst stretch of weather in my
adult life.

Speaker 1 (07:56):
I feel very I could probably say we're on the same
page.
In Buffalo, because it has beenwe had like a couple of like
teaser warm summer feeling daysand then it's been like
consistently like a lot of rain,like a ton of rain and like
just not warm, like not warm atall.
Um, Northwest that's the.

Speaker 3 (08:17):
That's the standard out here.

Speaker 4 (08:20):
It's like you could tell I got a little sun.
Yes, there was the first niceday we feel like we've had.
We walked into Memorial DayParade and now it's supposed to
rain for the next six days.

Speaker 3 (08:28):
So yay us Yucks it's supposed to be 86 here tomorrow.
We're swapping weather patterns.

Speaker 1 (08:38):
All right, so, ken, give us the latest on the market
.
You and Ben were having a goodlittle dialogue off air
beforehand, but before we talkoutgo, I want to get your take
on.
You know, where have you seenthings?
We we've, like historicallydone like an annual um show with
you where we talk about, likeeither how the year went or the
upcoming year will be or itwould expect to be.

(08:58):
We didn't do one, I think, inlike 18 months.
So I'm curious, like what's'sthe what's the state of the
market overall?
I know we get a lot of, youknow, weekly stuff from Dean and
from you guys.
Big picture, though, like we'rejust about mid 2025.
I don't think anybody thoughtwe'd be where we are right now.
Still, but what?

(09:20):
What can you say?
You know where have things gone?
Where do you see them going,like on the biggest level
possible?

Speaker 4 (09:29):
Yeah, I mean it's just incredibly stuck right.
I mean it's as indicative ofequilibrium as you could
possibly get.
I don't think the market'strending down, it's certainly
not trending up, it's just stuck.
So we had our executivesymposium in Phoenix last week.
80 or so top execs fromprobably what's called the top

(09:50):
50, top 60 brokerages verysimilar sentiment.
So you know, maybe we'regetting two to 3% on RFPs if
they're lucky, like very luckybut the spot market is just
absolutely holding steady atwhere it's been largely for two
years now.
Road check week I think everyone, especially the loudest voices
out there on social mediathought 200,000 drivers were

(10:13):
going to come off the road thatdon't speak English.
That wasn't the case.
It was just like every otherroad check week.
I made a joke this morning,right, that all of a sudden,
these 200,000 mysterious driversthey spent road check week and
Memorial Day learning Englishand now they're proficient again
because the markets come rightback to where it was and it's
just.
That's what happens when amarket's at equilibrium.

(10:34):
Just think of like it'sbuoyancy, right.
When the market's over capacity, it's like a dead weight in the
water and when it's you know,when it's way under capacity,
it's floating above the water.
Right now we're just kind ofriding the waves and if we get
tropical weather or a polarvortex or road check week, the
market responds and thenimmediately snaps back to where
it was.

Speaker 2 (10:53):
So I have one question about that.
So, from the macro perspective,right, it seemed like the past
two years, right, we're in likethe end of what a four-year,
basically, period where themarket hasn't really changed,
right?
Post-covid.

Speaker 1 (11:06):
But like yeah, let's call it three.
Three, I would say like springof 22, right?

Speaker 4 (11:10):
Yeah, yeah, yeah.

Speaker 2 (11:13):
So the thing that I've seen, again anecdotally, is
that, like any of those thingslike road checks, storms or
anything that were evenregionally affecting capacity
like that normally did pre-COVIDseem to start happening more
now than they had.
And again, is that indicativeof enough carriers leaving the

(11:34):
market that you're starting tosee these things affect the
market more when they do happen?
Because, like the Savannahmarket got super tight last week
to where, like I know they said, like the tender rejections
went up like 28%, but like,again anecdotally, people were
paying like literally two, threetimes the rate to get something
moved out of there.
I just don't remember thathappening the last two years,

(11:56):
right Of this period, where anyof these things affected the
market enough to see the lanerates ever move that much again,
is that showing that we'regetting closer to at least the
excess capacity shutting themarket, do you think?
Or do you think it's just abunch of things converging at
the same time?

Speaker 4 (12:12):
I think, like I posted about Savannah last week,
I mean it just happened to bethat they were caught
flat-footed without enoughtrucks and the marginal units
right, the last couple of loadswithin the last couple of trucks
, or what everyone talks about,right?
I mean, it's hardly ever.
I don't think the first loadout of Savannah last week raised
an eyebrow.
I don't think the middle 50% ofloads raised an eyebrow.

(12:33):
I just think, like on themargin, a lot of trucks have
come out of the market.
They're not continuing to comeout though, right?
That's what I think is reallyinteresting.
Like the last two months, wenet added capacity.
Now April always adds capacity,right.
So I really think, for as muchas being made about what's

(12:53):
happening right now, it reallyisn't that much different than
2019 rounding into 2020.
Had COVID not happened in 2020and we didn't see a market
recovery, we would have had theexact same conversations of how
could we possibly repeat a yearlike 2019 again.
I was still in the industry in19, and it was absolutely awful.
I came to DAT in middle ofDecember and it was like a
Christmas present to get out ofhaving to worry about profit

(13:16):
margins and sending hourly folkshome for 36-hour work weeks
instead of 40.
That was as bad as I could everremember it being.
36-hour work weeks instead of40.
That was as bad as I could everremember it being.
And I don't know.
Do people really like to sitaround and compare the worst
times they've ever experienced?
How much does it actuallymatter if 2024, in the rear view

(13:36):
, was worse than 2019?
Not at all, and so I do thinkit's just too much volatility
with the trade policies.
That's what this all comes downto.
I think.
Had we not had an absolutecoronary in the trade policy
department, we probably would beup seven to 10% year over year

(13:57):
right now, just kind of plottingalong anticipating some Trump
tax cuts with a GOP House,senate and presidency, as
opposed to like literally justcontinuing to hit our foot with
a hammer over and over and overand over and over again.
And that's not a politicalstatement Like I don't care who
you vote for, who you support.
It's just like this is crazy.
Whether you're a Democrat orRepublican, an alien or you've

(14:19):
never even you know you've neverspent a day in global trade.
This is just crazy what'shappening.

Speaker 1 (14:26):
Yeah, it is weird, it's so my, my assistant,
started working for me in May of2022.
And like I remember telling him, I'm like, yeah, I'm like you
know, as we got towards the endof 2022, I was like, yeah,
you'll probably see like themarket shift into next year.
And then we have a conversationlike a year in, two years in,

(14:47):
and now like three years, andhe's like man, he's like where's
this like this turn thateveryone's been talking about?
And then I looked back at theother day.
I look back at like justnational spot rates across like
the three you know, your drive,your van, reefer and flat, and
I'm like they've just been likeflat for years now.

Speaker 4 (15:08):
So I've never seen anything like it.
I mean, honestly, prior to thelast six months, I would have
said this was not abnormal,right, because, like, the front
end of the cycle was not normal.
You know what I mean.
Like it's like I hate to use aroller coaster analogy, but it's
like going up or going up thehill and then being shocked when
coming down was fast and goingup a bigger hill meant you shot
it, like, but the fact that it'sstuck there is, I think, what's

(15:31):
concerning even the most mildmannered Cause.
I don't like freightsensationalism.
I think you know that about me.
Um, it's just that's.
What's most vexing about thecurrent situation is how stuck
things are.

Speaker 2 (15:44):
And that was the thing that, like, we've talked
with Dean about.
I think he was on like December, we were, you know, end of last
year, somewhere give or take.
And we were talking about, likeyou know, there's two.
That's the tale of two carrierscoming out of this right, you
have the carriers that paid alot for their trucks, that have
to get break even at.15 a mileright, but also got a lot of
COVID money right or banked alot of money and saved a bunch

(16:05):
and had enough saved for therainy day.
Then you have the other side ofthe market where carriers
bought really cheap trucks andwere able to bank money right
and also borrow some money.
Coming out of this, where he'slike you know the operational
cost.
There's like two very differentnumbers where, like, some
carriers are able to break evenat like even a buck 90, a buck
95.

(16:25):
Then you have this whole othersection that is over two bucks a
mile.
And he said the interestingthing is like none of them from
what he was saying like, do youfeel like has enough money in
these coffers still after threeyears for a rebuild on any of
these trucks?
And he's like now we'rereaching the mileage point and
time point at which all of thesetrucks are going to need

(16:45):
rebuild.
So even if you got a cheapertruck, you're going to have to
put in.
And he knew the number off thetop of his head.
I can't remember what therebuild number was, but it was
significant.
And he's like so if you don'thave that in savings and you
need a rebuild, you can't justkeep driving, they're going to
have to leave.
And there was his sentiment.
It was, you know, somewherearound the midpoint of this year
those carriers are going tohave to exit the market pretty

(17:06):
quickly because, like, they justdon't have the money, can't
borrow more money, because themarket isn't good enough, their
balance sheets don't look goodenough, the income statement
doesn't.
How are you going to get arebuild?
You're just going to leave.
And he was expecting a big massexodus in the carrier market
and like you just kind ofhaven't seen it.
And then it's like on DOT weekLeffler was talking about like
it was something like 4% ofcarriers like didn't have any

(17:27):
CDL whatsoever.
And it's like are people justdriving just with no CDL and
just completely defunctequipment that aren't anywhere
close to the service standards?
That is keeping the rates upBecause, like, economically
speaking, as big of a hill as itwas, they still should be
exiting the market at some point, right To bring that capacity
back up, or I mean, you know,the equilibrium back up.

Speaker 4 (17:49):
I mean, the FMCSA is like the Cleveland Browns of
government associations, right,like they are the absolute worst
, right.
You've got a guy who's, like,only claimed to fame as being on
road rules, making a big dealabout the English language
proficiency thing, and again 20some percent of commercial motor
vehicles are unsafe at anyspeed.
And then you've got again largepercentages of folks who are

(18:09):
getting out of serviceviolations.
I don't even know I was readingthis tweet from Fuller which
actually blew me away which islike they can't even be taken
out of service because they'retechnically not commercial motor
carrier drivers, like they'renot even licensed to operate.

Speaker 1 (18:24):
So there's actually no Because they never were
authorized to yeah.

Speaker 4 (18:27):
What do you think they're going to do?
They're just going to go rightdown the road and hop into
another truck, and that's what Ido.
I think it's changing a littlebit, like it's a little bit of a
moving target.
But at the end of the day, overthe short term which short term
has changed in its definition alittle bit Market rates are
bound by the variable cost tooperate, so literally the
rolling costs go down the road.
Over the longer term it willbake in the rebuilds and

(18:53):
changing insurance costs andreinvestment and all that the
problem becomes.
We're all going to be verydisappointed if this true
recovery is a supply-drivenrecovery, because those are
always very tepid and unexciting.
And that's when you start tosee a lot of turnover at the top
, like large brokersconsolidating or going out of
business.
Think like Celadon a few yearsago.
What you want to see is-.

Speaker 1 (19:12):
You want demand-driven right.

Speaker 4 (19:13):
Yeah, you want to see like this would be.
Maybe I'm going to speak itinto existence, but this is
where you're primed for a demandevent to shock the market like
ELDs.
You were coming off a really,really sluggish 16.
Capacity had completely cameout of the market and then you
had Harvey and Irma, the Trumptax cuts and then boom ELDs, and

(19:35):
it was like a demand.
Covid was a demand-driven,again on the heels of a very
weak capacity market.

Speaker 2 (19:42):
If we're going to rely on the upward pressure on
rates being purely supply-driven, we're going to be in for a
pretty that caps out probably at10% to 12%, if we're lucky,
unfortunately, maybe we're luckyand it'll be both, but these
carriers won't have to go out ofbusiness because they have a
market-leading factoringsolution.

Speaker 4 (20:03):
now that they can acquire through DAT to manage
their back office at well belowtheir competitors from a rate
perspective, what?

Speaker 1 (20:11):
a fantastic segue.
Yeah, so obviously big news,marcus.
We've got you with us today, Iguess.
Paint us a picture.
What's the big news?
What happened?
I'm sure Ben and I will havelots of questions and whatnot,
but give us the rundown.

Speaker 3 (20:30):
Yeah, so, fresh off the announcement on the 15th DAT
acquired Outgo.
Outgo is a fintech andfactoring company that serves
carriers and, like I said, westarted five years ago.
Carriers care about findingwork and getting paid, and not a
lot of innovation has happenedaround helping them manage their

(20:52):
backoffs and getting paid, andso Alco built a software
platform connected to a bankaccount that it's like hiring
our software to run your ARdepartment, and so it's reducing
the costs, increasing theflexibility and speed that

(21:13):
carriers need to run 24-7, 365.
And so I think it's aboutputting them back in control of
what it means to run aprofitable business as much as
we possibly can with, obviously,the services we offer, and
putting that under the DAT suite.

Speaker 1 (21:29):
I got a question on that because I wasn't very
familiar with Outgo previous tothis.
I've been trying to learn aboutit.
I'm sure this is probably goodfor anyone listening too.
Before DAT's acquisition ofOutgo, how was one of your
customers using the service?
So if I'm a small truckingcompany, for example, we'll say

(21:50):
I'm the average size truckingcompany, which is arguably small
how, how are they using Outgo?
Yeah, so what does thatactually look like on a like, a
actual like load level orwhatnot?
How do they?
Yeah?

Speaker 3 (22:05):
Yeah, yeah absolutely .
OK.
So when you're a carrier, youlike, you have back office
services that you hired aroundyour business so you might have
a factoring company.
You get a bank and then you mayhave a separate way to make
payments.
And so we took, we looked atthat back office life cycle from
you know, you get your, your,your rate con, you deliver the

(22:28):
load, you get a BOL, you got tosend that in to invoice the
broker and you know, then itstarts a payment clock Typically
it's around 30 days and andthen that money lands in your
bank account and then you makepayments, you know, etc.
But obviously we know that, likerunning a trucking company,
there's high operating expenses.

(22:48):
You got fuel, you got payroll,you got insurance, you got your
equipment costs paying for yourlease or your truck payment.
So a lot, of, a lot of carriersturn to factoring companies and
those factoring companies arevery traditional finance
companies.
They use off-the-shelf softwareand they hire a lot of people
to run the invoicing process inthe back office.

(23:08):
And we as technologists I'vebeen in technology for 25 years
we look at technology asleverage and automation and
really kind of use technology totransform how business is done.
And so we took that sort ofback office process.
Think of it as like your ARdepartment.

Speaker 2 (23:28):
Yeah.

Speaker 3 (23:30):
And we built software around that process to automate
the load lifecycle, and then weconnected it directly with a
bank account.
Think of it as, like, I guess,most corner banks, they only
offer treasury services for mostsmall businesses, particularly
trucking companies, because theydon't know how to underwrite

(23:50):
them, they don't offer them thecredit.
So you have your bank and thenyour factoring company, and your
factoring company sends moneyto your bank and then you make
payments.
Well, we combine that all intoone, so it's an all-in-one
business suite that manages yourback office.
And so we turn your futurepayments, your receivables, into

(24:12):
almost like an overdraft linethat sits right behind your bank
account that, as you OPEX yourbusiness, as you spend to cover
fuel maintenance payroll, wefactor on demand out of the
receivables due to you bybrokers you work with.
And so we built the first inthe industry fractional

(24:34):
factoring product that actuallyspends as you spend out of your
bank account.
It takes money out of yourinvoices and you only factor
what you need to fund yourbusiness.

Speaker 1 (24:47):
Gotcha.
So I'm going to break it downBarney style and tell me if I'm
regurgitating this properly.
So, traditionally right, like atrucking company, let's say
they're not factoring, they'redoing everything themselves,
right, they are paying.
Either they're wearing the hatthemselves to do this, which
takes up valuable time toproduce revenue, or they're
going to be paying somebody tohandle their AR department, like

(25:10):
you mentioned.
So that's like you said gettingthe signed bill lading or POD,
merging it with a rateconfirmation from a broker,
creating an invoice, sending it,hoping they send it to the
right person, and then, yeah,then they wait 30 days.
They get a check in the mail.
They have to walk to the bank,deposit it to have access to

(25:31):
those funds.
That's the traditional way.
Factoring says hey well, justsend us your paperwork and we
can basically pay you apercentage of that at a fee and
then pay the rest of it once wecollect on it.
And there's a whole.

(25:59):
You know we've had lots andautomation to shorten the uh,
the distance between all thoseconnecting dots and reduce the
manual lift to actually do thosetasks.
Is that like, in a nutshell yougot?

Speaker 3 (26:13):
it we.
It's like your AR departmentmeets your bank account and, uh,
and that's right.
So, like a traditionalfactoring company, they do, they
do your AR behind the scenes,but they give you cash
immediately at a discount andthen they collect on the
receivable because they own ityep, and they send all that
money to your corner bankaccount.

(26:35):
That you spend as you go outgoes different in that it all
you run all your a, all yourdocuments, so we can instantly
process your documents and sendout.
About 95% of our invoices aresent within four hours of
document submission, so thatstarts your payment clock right
away and then you can accesscapital money from that load

(26:58):
anywhere in the payment cyclebased on your factoring fee.
So it's a fully integrated ARproduct meets a capital product
and it's like super flexiblebecause you can only you only
have, you can only you only getto use what you need and you
don't have to use what you don'tneed, you don't have to access,

(27:19):
and so you can save money.

Speaker 1 (27:21):
I was going to say cause some factoring companies
will say like hey, 100% of yourstuff needs to, like you know,
exclusively come through us.
Yeah, that's right.

Speaker 3 (27:28):
That's right.

Speaker 2 (27:28):
So the two things and I have two things that I kind
of wanted to talk about is oneis what Nate just said, right Is
?
I used to see this when wefirst got in the industry.
I remember going to TQL becauseI had some carriers and I'm
like we're doing all of theirbusiness but yet we can't quick
pay them because they'refactoring company right.
They're basically getting aquick pay from the factoring
company and I remember runningthe numbers on just one carrier

(27:49):
and I'm like they're exclusive,meaning like they've got to put
every invoice they ever do withtheir factoring company and it
basically becomes like it's likea revolving prison because like
they can't get out becausethey're always spending right
what is coming in and they'realways owed the factoring
companies always owed moneybehind them.

(28:09):
And I looked at I'm like they'regetting, they're paying their
factoring company with some likea hundred grand a month on just
the loads we ran them and I'mlike we could make even 80 of
that grand.
They would save 40, but wewould have had to cut a check to
the factoring company for likea quarter of a million dollars
or half a million to buy themout of the factoring
relationship to be able to dobusiness with them directly and

(28:31):
it's just like.
It's like you end up with acredit card as a kid and you
keep making minimum payments.
You never get out of that debt.
It's the same thing with acarrier.

Speaker 3 (28:39):
Totally, you got.
You got exactly right and Ithink we saw that.
So my background is I've beenin tech for 20 years, have built
software.
I started at Microsoft and thenstarted companies about eight
years later and you know, weworked at a company called Axon.
My co-founder and I sold ourfirst company.
We want to build softwarethat's mission specific that is

(29:00):
used by people to change theirlives.
We serve law enforcement forfive years by building them a
suite of services around bodycamera and digital evidence
collection, and so myco-founders then went to Convoy.
I was at Uber for three yearsand we got back together and we
said, hey, we have this missionof focusing and we think

(29:21):
carriers are really underservedwhen it comes to managing their
payments in their back office.
And we just saw this hamsterwheel that factoring was that
once you get off on that thing,you can never get off of it.
And listen, some people need it, some carriers need the cash
flow.
You're an early one truckcarrier.
You're going to have higheroperating expense needs, that

(29:43):
you're going to use up maybe allof the receivables that you run
on a weekly basis, but you cannever get off of it, and I think
that's why we wanted to kind offlip it on its ear and build
software and a banking platformthat said hey, listen, run your
receivables through thisplatform, run all your loads,

(30:03):
and that you can adaptivelyaccess the cash flow you need.
And if you don't need it,that's cool, we'll charge you a
floor rate and it'll operatemore flexibly and it's not a
one-way door.

Speaker 2 (30:16):
And I wanted you to just stop there because, for the
audience, what I want everyoneto understand what that means is
if I don't need the money,money, I'm not paying interest
just to have it sit in my bankaccount.
That's the way a traditionalfactoring company is like if you
need it, you got to take all ofit and you're already paying
interest and fees on that.
And what Marcus is saying is ifI only take what I need out of
my invoices, I'm not payingadditional money to have cash

(30:40):
sit in my bank account I don'tneed for my expenses and I'm
flexible as in when and how Iactually need to take it,
meaning that money is cheaper,actually like you earned it, and
you get to keep more of it.

Speaker 3 (30:49):
Right, that's right, that's right.
And I think, like we have a, wecan get into the details, but
like we have your top line rateand then your floor rate and
like you can adaptively accessthe cash you need, which will
lower your effective rate as yourun your business.
And again, like, if you need it, if you're running one truck
and you need all your cash fromall your loads, you could take

(31:12):
it.
But then let's say you don'tneed.
You grow and you're building upyour business, you can adapt
how much you take in the future.
Because again, it sits, theservice we built.
It sits right behind your bankaccount like an overdraft line
that adaptively, like, as youspend out of your bank account,
we cash flow your needs, whetherit's payroll or fuel or

(31:34):
maintenance so how does themoney?

Speaker 2 (31:36):
the second question is like the money that goes out
to expenses, right, like in myhead I'm picturing similar to
like paypal in a sense that likethey kind of sit together but
they don't sit together in asense that like so if I'm paying
a bill as a carrier, is thatcoming out of Outgo or is that
coming out of my bank account?
Or am I moving all of my moneyexpenses into the Outgo system

(31:58):
to pay them directly out of yoursystem?

Speaker 3 (32:00):
Yeah, so so we're, we're, we're very flexible, so
it's a with Outgo you get a fullFDIC insured checking account.

Speaker 1 (32:08):
Okay, I was going to say there's actually a bank
component to this right.
That's right.

Speaker 3 (32:12):
Yep, we have a partner bank and you register
your business entity with ourbanking partner and it's the tax
ID number of the business.
So it's your bank account, it'sall yours.
It's got a routing number, anaccount number, and you can
spend money out of that accountjust like you could a
traditional corner bank, or youcould move money from that

(32:36):
account, your Outgo account, towhatever corner bank you're
using.
But I think the idea is that wehave a debit card that is
attached to that account andthis using.
But I think the idea is that wehave a debit card that is
attached to that account, andthis is where it's really the
differentiator is that you cansubmit a load and we have a
four-hour funding guarantee forapproved brokerages, where that

(32:57):
money can become cash in fourhours and spendable out of your
bank account on your debit card.
Or we have other, like Visa,direct payment rails.
You can move money around andso you can pay whatever you need
.
Whether it's you pay off yourfuel card, your insurance, you
can pay it directly out of thataccount.

Speaker 1 (33:16):
So like if I'm let's say I'm running a small truck,
or any truck company for thatmatter.
Instead of having to go to abroker and say, hey, can you
send me a fuel advance, Right,my driver can just go to the ATM
pull money out.

Speaker 3 (33:32):
Right yeah.

Speaker 1 (33:33):
Yeah, we have on their balance sheet, essentially
their balance sheet, right.

Speaker 3 (33:36):
Assuming they have either money in their bank
account or they have receivablesthey haven't factored, they can
.
They can pull money directlyout of the ATM if they need cash
.
So they could frankly, theycould use their Alco Visa debit
card at a point of sale tofactor on demand at a point of

(33:56):
sale to factor on demand.
Okay, so think of it as, likeOutgo has a bank account and
there's a debit card attached toit.
It's a Visa sponsored debitcard.
You swipe wherever you swipe,we're in the authorization flow
of that swipe and we can factoron demand for you Interesting.

Speaker 2 (34:14):
So I want to point out too for anyone out there
that's like thinking about thisor trying to understand how and
what this affects right, like mymeeting after this okay is
literally with the factoringcompany to go through our
integration with our TMS,meaning like all of the invoices
and BOLs that go over through.
It is not and everything isfully integrated and it is not,

(34:37):
I would say, straightforward tobe able to see the difference
between what you send into thefactoring company and the cash
that actually comes out of thefactoring company.
And I've been I mean, I've beendoing this for 15 years and
like we're going to go throughthis line by line, to go and
look and see exactly how thishappens.
And I think for a carrier outthere, like the ability to have

(34:58):
this all sit in one place is nota small thing, like knowing
that you're putting yourinvoices in and your BOLs and
being able to see it all thereand see what's hitting your bank
account in one place is a verybig difference from the way all
of these operate.
Now.

Speaker 3 (35:14):
So, ben, this is exactly why we built the
software the way we did isbecause we felt that there
wasn't transparency within thespace to see exactly where your
fees were going, and we custombuild a platform around your
bank account that shows you downto the penny on every
transaction, where the money'scome from and exactly how much

(35:35):
you're paying.
So you can go.
Let's say you have a, you knowyou want to make a $500 payment
out of your account and it justso happens we need to take $250
from one invoice and $250 fromanother invoice.
We're going to show you exactlywhat invoice does those come
from and we're going to show youthe fees that you pay to access

(35:56):
that cash.
And it's like you can literallyclick down into the details to
see what you paid and how muchexactly when you paid it.
Because we felt like thereneeded to be greater
transparency, both on the costof factoring but also on the
fees around the movement ofmoney that often get charged in
this space, and so we wanted tobuild a custom software platform

(36:18):
that showed you all the detailsyou wanted.

Speaker 2 (36:20):
And I wanted, like I was literally working on this
Friday and this morning, like Ihave a background in accounting
I don't I'm not practicing thatfield anymore, but like at least
enough of an understanding thatI should be able to follow a
transaction right From my TMS tothe bank account literally
couldn't follow it.
I'm like could not go throughline by line to see exactly the
statuses of what was purchased,what was funded, what was held,

(36:43):
which portions were and whichwas going to hit the bank
account and when.
Because even when thedisbursements come from the
factoring company and we use oneof the three largest factoring
companies, like it's a bank, youstill can't see it because
it'll do disbursements but itdoes them in lump sums without
remittances.
So it's like hey, we dropped 15grand in, but you can't trace
to your point which invoicesmade up that 15 grand, which

(37:06):
portions were held, which werefees and what does that actually
look like on a per load basis?
Like literally exporting theminto Excel to try to find that
and we still can't find it.
Like it's literally what mymeeting is after this.
So it's like when you're acompany that depends on, I mean,
it's why you go to work is togenerate cash to pay.
The fact that most TMSs aren'tintegrated both ways and will
feed information to a factoringcompany one way but not back the

(37:41):
other way, so you can't evensee this in your TMS in most
cases.

Speaker 3 (37:45):
Yeah, so you can export your bank statements
directly out of Outgo.
But that's why we started this.
We did hundreds of interviewswith carriers truckers that were
like and we looked at the backoffice ecosystem getting paid
and they're like factoring isjust a one-way door that they
felt like they didn't havecontrol over.
It was a necessary evil to runtheir business and we wanted to

(38:14):
put more power in their handsand flexibility and control over
their finances and I think thatwas the premise behind why we,
why we?

Speaker 1 (38:17):
started what we did, ben.
We always say, like, whenpeople ask about factoring,
we're like I've used the phrasenecessary, evil, um, the same
way that you just did, marcus,and I always would say, like
factoring is something that youshould do until you don't need
to do it anymore, right, and Ithink what the trap a lot of the
companies get you in is that,like, hey, we're you're going to

(38:42):
have, you're going to berequired to factor a hundred
percent of your invoices throughus.
So there really is no easy wayout of it, whereas you have it
sounds like.
Well, I mean, it was not whatyou just said.
You have the ability to tochoose.
You know, if you want to scaleit down on how you're going to,
how you're going to use theservices, it's going to reduce
your effective rate that you'repaying.
So that's right.

Speaker 3 (39:03):
I think the bigger problem is that you know, I
think banks just don't servesmall, small trucking businesses
.
They don't know how tounderwrite them and I think
that's created this need forfactoring companies, because
ultimately what factoring is isinvoice underwriting.
You can look at the history ofa business and determine the

(39:24):
creditworthiness of them, and Ithink that's easier to do the
more trucks you have.
But the same problem exists,whether you're running one truck
or 40, is that oftentimes abank won't even collateralize a
business against equipment,especially over the market over
the last few years, as powerunits are, you know, declining
in value because we hit peaksupply back in 23.

(39:46):
So you know, the ability foryou to grow your business
working with credit from abanking institution is really
difficult and I think you knowwhat we see is that this your
invoicing history.
Whether you're a one truck or50 truck carrier, you're working
on a platform that reallyunderstands your business and

(40:06):
that's the.
That's our goal of providing afinancial back office suite to
just run a more profitable,efficient company just run a
more profitable, efficientcompany.

Speaker 2 (40:22):
And the irony is that , like small business banking is
you have to put your bankaccounts with me if you want to
borrow money, because I need tosee your money coming in and
going out.
Right, but to your point, theproblem with the way it's been
structured is that, like they'renot built to lend money like to
small businesses becausethey're incredibly hard to
underwrite.
Like, if you're going tounderwrite a small business as a
bank, the first questionthey're asking is what's your
collateral other than thisbusiness?
Not the truck you're driving,not your office, not your

(40:44):
computers.
Do you have a house?
Do you own another building?
And secondly, are you marriedand do they have a job?
Because I'm underwriting theirincome and the other collateral
to give you the money for thisCause.
I don't know what the businessis doing and your point.
And then, like, what I think iscool about Alco is like, by
tying the bank account to it,you're giving them the benefit
of ease of use and transparency.

(41:06):
But also back to you guysbehind the scenes.
You have visibility into whatthe business is doing, the
lifeblood how much is going in,how much is going out to be able
to better service those peopletoo.

Speaker 1 (41:18):
Let me assist you on the receivable side.
Is a carrier able to see like,hey, this broker is probably one
you don't want to work withbecause of how they've been
paying their bills.
Is there like a credit checking?
Or even with direct shipperstoo?
Most factoring companies,including us, provide a.
Is there like a credit checking?
Or even with direct shipperstoo?
Is there?
Is there a-?

Speaker 3 (41:36):
Most factoring companies, including us, provide
a way to look up a broker todetermine sort of their credit
worthiness, their days to paywhat they're like to work with.
And you know we work directlywith thousands of brokers, just
like all these factoringcompanies.
So we know who pays us on timeand who doesn't, and we

(41:57):
integrate that data into ourplatform because brokers and
carriers can make an instantdecision about whether they can

(42:17):
factor an invoice with thatbroker.
You know on Alco, and so thebottom line is like you know we
provide that information both indetail via a search interface
but then also directly on a loadboard for them to decide who
they want to take a load from.

Speaker 1 (42:32):
Is there a?
I'm trying to think of an issueI've been dealing with.
Hopefully it's an isolatedincident, but we had a slew of
double, triple, quadruplebrokered loads that we
identified and it's nasty andlike we're trying to figure out

(42:54):
who what belongs to who typedeal.
Is there like a fraudprevention piece to any of this
where it'll help?
So for Outgo.

Speaker 3 (43:03):
I can.
I can talk about what we'vebuilt at Outgo, but ultimately
you know we've we built anintegrated platform that is
customer focused but under thecovers.
I talked a lot about how it'sdirectly connected to the
banking network because we're afintech.
But we've built three riskengines.
We have a carrier engine, wehave a broker engine and we have

(43:25):
an invoice engine and those areunderwriting brokers and
carriers upfront when they jointhe Alco platform.
And then when a carrier submitsa load document, we analyze
that load document with ourinvoicing engine, risk engine,
to determine the carrier on theload, the broker on the load,

(43:46):
and ensure that it's all legitand healthy in real time.
And we have processes to gothrough and adjudicate and
identify common forms of fraud.

Speaker 1 (43:59):
But NetEase is like we built that into our platform
as part of running sort of aFinTech and payments platform
owner-operator, for example thathe's trying to figure out like
hey, you know, this says you'resupposed to pay me and we're

(44:20):
like, well, I have no idea whatload that is.
And you find out somebodydoctored a rate confirmation and
then like on top of it, likethe bill of lading, they're not
even the carrier that's listedon there and it's like you know.
We'll try to help you get tothe bottom of this, but
unfortunately it should be aduty of yours to verify that,
when you're accepting a load,that your company's name is

(44:41):
listed as the motor carrier onthat bill of lading, which is a
legal document, right?
That's right, you probably haveimaging that's reading that and
catching doctor documents andthings like that you know,
doctor documents and things likethat.

Speaker 3 (44:57):
Yeah, Double brokering happens and we have
customers that run intochallenges where they didn't
properly assess the paperworkand see that the you know the
domain has changed and thecontact has changed.
And we work with them in casesto try to work with the broker
to figure out, like either holdpayment and like also teach, to
say like hey, look at that rate,does that rate rate?
It looks like it's way abovethe market rate here.

(45:20):
If it looks too good to be true, it's probably too good to be
true.
You need to ask more questionsabout that rate.
Systems that detect doctoredpaperwork, and so that's part of
the process.
But also it starts up frontwith the carrier looking and,

(45:42):
like you know, challenging isthat the right rate for this
lane right now?
And you know, I think again,this is why also, like you know,
the connection with DAT makesso much sense is that if we're
linking all these together, youcan see there's going to be more
opportunity to come of helpingcarriers make really good

(46:03):
decisions about what loads arethe best for them and, you know,
integrating that into the loadlifecycle from an AR and payment
standpoint.

Speaker 1 (46:11):
Yeah, like if rate view is telling you hey, here's
your 50th percentile on thislane and you're being offered a
triple rate.
Triple that, that amount.
Um warning, yeah, that's goodexactly, exactly.

Speaker 3 (46:24):
Like you know, spidey sense should go up and but
there's all.
There's so many subtleties,like in modification of
documents, that you know it'shard to detect.
Detect a slight characterchange on a domain.
Obviously, we've seen FMCSAcontact modification to make it

(46:46):
even harder.
But Net is like listen, it's anever-ending battle to deal with
fraud in the industry.
But the net is that we've hadto do that on the payment side
and continue to make investmentsthere.

Speaker 1 (47:03):
You mentioned the blue checkmark on DAT.
I'm curious what's next, orwhat does this mean for
everybody, with now DATacquiring Alco?
What are the changements?
You know what are the changes,or I guess what changements
enhancements et cetera.
So you mentioned Blue Checkmark.
Carriers are going to knowright away this is a factorable
carrier.

Speaker 3 (47:23):
Yeah, it'll be a factorable load with via Outgo
for that broker and you know,obviously we're we're just you
know about seven days in, but Ithink the bottom line is like we
want we want to bring thefinancial back office suite for
carriers to run their businessand connect it with the tools,

(47:45):
the load board and themarketplace for carriers to make
.
They're going to make gooddecisions about what work they
do and they're going to have asoftware platform that helps
them get paid efficiently andthose things are going to work
even better together.
You know, over the future.
I think you know day seven it'sabout ensuring that there's,
you know, tight integrationacross the two and I don't know

(48:09):
that we have any immediateannouncements to share like
specific, like new features, butyou should be able to find work
and get paid really efficientlyin the marketplace.

Speaker 1 (48:18):
So if somebody, um, if they want to use Outgo and
they're an existing DAT user, isit like they're automatically?
Do they already have an accountor is something they have to
see?

Speaker 3 (48:29):
Yeah, so they there's a, there's a website.
They just go onto the websiteand they link and click through
to factoring.
They can also go directly toAlcocom and sign up to join the.

Speaker 2 (48:49):
Alco service.
How does that work for acarrier that already has a
factoring company?
They have additional steps.

Speaker 3 (49:01):
It's typically.
What's required is that you needa buyout and this is because
you're about normally 30 daysahead.
You have like a balance of thelast 30 days of loads that
you've done and because of the,the way factoring companies are
secured, you know one, the thenew factoring company would work
with your old factoring companyto buy you out of your uh, your
loads or your contract and thenmigrate you over to the new

(49:23):
platform.
You know every company has adifferent um you know set of
terms of what they allow andwhen they allow it.
So you have to look at theterms of your factoring
agreement to understand when youmight be in the buyout window.
Again, many factoring companieshave long-term contracts that
they retain you on.

(49:43):
Alco is a little bit differentin that we have no long-term
contracts and you can leavewhenever you want.
I think we have a 15-day or daynotice of of of transition, but
when you decide you want tojoin Alco from another factoring
company, you share with us yourfactoring agreement and then we

(50:05):
would go through a buyoutprocess with your previous
factoring company.

Speaker 1 (50:12):
Interesting Ben.
You got any other questions?

Speaker 2 (50:16):
I don't.
I think this is really prettycool and the fact that you guys
have that that's, you know, kindof seamless in the background
that allows carriers to workaway from their existing
factoring company into a new one, that all the money out all at
once, all at the same time andjust at the end of the day, like

(50:36):
these numbers add up, like evenlike when you see, like from
the brokerage side, it's like,oh, I'm only paying 1.2%, but
that's not annualized.
Like annualized, those numbersend up being like 12 to 16%.

Speaker 3 (50:50):
You got it Totally.
This is the challenge is that Ithink when you look at the
discount fees that are taken outof an invoice, if you annualize
that in the terms of APR, it'spretty high APR it's, like you
know, north of often 36 to 60percent, depending upon you know
what the what the percentage is, and so it can get quite

(51:12):
expensive.

Speaker 2 (51:13):
And think about that like, for every thousand dollars
you make, right after you payall your expenses, you're hoping
to keep 200 of it.
Right Like no, you're givinganother half of that to a
factoring company.
In some of these instances, toyour point.
And it's like if you can reducethat number, right, that's just
more money you get to keep thatyou've already earned, instead
of sitting in some static setupthat was set by a factoring

(51:37):
company that everyone just hasto do on every invoice all the
time.
Right Like?
You're just not keeping enoughof your own money.

Speaker 3 (51:42):
In those scenarios, I feel like and here's the other
thing about that.
I think technology unlocks morevalue in that we you know
carriers need speed andflexibility and transparency.
You need money 24-7, 365.
And you want the flexibility toonly take what you need,

(52:06):
because you don't want tooverpay for funds.
It's like you don't want totake out a loan you don't need.

Speaker 2 (52:10):
You're borrowing your own money.

Speaker 3 (52:12):
Yeah, yeah, you want to run a vision business and I
think the technology platformwe've built really puts the
carrier back in control of theirfinances and you know whether
it's you just want to factor andrun your entire business and
take cash flow or you want touse our software as an AR
department, like we felt likethere was total automation

(52:34):
capable there in the market andwe want to put more power in the
hands of carriers to just runtheir back office more
efficiently.

Speaker 1 (52:44):
Yeah, it's like you don't.
If you want to go buy a car for, let's say, 25 grand and you're
taking an auto loan out, youdon't take a $50,000 loan out,
you know, and pay interest onthat to buy a $25,000 car.
It's like, whereas if you'refactoring, even if you don't
need all the money right away,and you're forced to put a
hundred percent of it through atyour three to 5% rate, like,

(53:04):
yeah, you're, you're, you'repaying fees that you otherwise
shouldn't have to pay, and itsounds like Alco is a great
solution to that with being ableto hey, when there's that month
when you've got a big expenseand you do want to maximize the
amount that you can get accessto, you have the ability to do
that.
But the other one, you don'tneed it, you can, you can find

(53:27):
that happy medium.
So it's kind of like you know,your solution helps companies
grow at whatever speed they aregrowing at, and every company
operates individually.
Right, it's their own storywith their own you know growth
trajectory and all that.
So that's good, that's.
That's a.
It's an interesting concept.
I, I are, you, are you guyslike the first?

(53:47):
Did you like trailblaze this?
It's like.

Speaker 3 (53:51):
Yeah, I'm really proud of the team and what we
built.
We were the first ones to bringFinTech.
It's called FinTech, it'sbasically connecting a bank

(54:13):
account to software and theopportunity to really bring what
I would say is fintech and AIfor automation all together in a
suite that really gave carriersleverage to run their business
more efficiently.

Speaker 1 (54:28):
Nice, well, that's cool.
Ben, you got anything else onthis?
I'm excited to see how this all, like where it can go, because
I feel like you know, this isthe beginning of what could be.
You know, I have like a millionideas in my head of like how
you can use similar technologyin other applications in our
industry.

Speaker 3 (54:49):
So, be cool, we're excited.
Actually, when I first startedtalking to Ken was a couple
months ago now.
We just talked about the visionof what could be to bring Alco
under the DAT umbrella.
No-transcript.

Speaker 1 (55:26):
Ken, are you, do you have any direct involvement in
any of this or any any anythingto add in that we didn't hit on?

Speaker 2 (55:35):
I always, I always think of you.

Speaker 1 (55:36):
I'm like he's the numbers guy.
He's like the, the analyticsguru yeah, it's, it's been so.

Speaker 4 (55:42):
About a year and a half ago I took over corporate
development at dat right.
Roper, our parent company, hasbeen pretty vocal about their
interest in getting into kind ofa diversified investment
approach instead of just buyingbig platforms every year, taking
on, uh you, 30% to 40% of theircapital deployment on bolt-ons,
which is what you would callOutgo or Trucker Tools, earlier

(56:02):
this year.
So, yeah, I mean, I don't know,I think it's probably more luck
than anything, but less than ayear and a half in to have two
deals hit has been awesome.
Everything out there is forsale right now.
I think there's no mystery toany of your listeners that, um,
I guarantee that every one ofyour brokerage listeners have at
least one vendor that's in anactive process to sell or raise

(56:25):
money right now.
That's not like a hot take oranything crazy.
So it's going to be a veryinteresting year.
I think it'd be really fun todo a corporate development redux
at the end of the year oneverything that and where
everything landed.

Speaker 1 (56:42):
Yeah.

Speaker 2 (56:42):
Yeah, there's a ton of potential in this when my
brain went the first time andI'm going to be anxious to
follow up later this year on howthings kind of come to fruition
.
But it's like you've gotvisibility now between the load
board and the marketplace,directly to a bank account.
Why that matters is they'refederally regulated, meaning
you're going to know yourcustomer knowing where those

(57:03):
funds actually went, right.
So I think there's a ton ofpotential to increase trust in
the market, increase trust inthe marketplace to be able to
verify these things.
At the end of the day,everybody wants to just make
sure that the people thatperform the work get paid Right,
and in the middle there's usRight.
There's that as the marketplace, we're connecting the people

(57:25):
that are needing the work doneshippers, with drivers doing
that work, and the more you canverify that the person or
individuals that perform thework are the ones that got paid,
the more work gets done, thefaster things go, the more
transactions happen, and I thinkthat's good for the industry.

Speaker 4 (57:40):
You got it large, yeah yeah, you've said the
entire thing.
It's like ben gpt I'll sayright, like this is, it's not
just going to be who's buyingand selling.
I think, like the consolidationplay um, all of the swirl that
happened during covet, all ofthe advancement remember
pre-covid paper bill of ladingsand pod's, and everything was

(58:01):
still by far the more commonapproach to checks like yeah, I
remember, um, yeah, you go dropyour com checks.
We used to mail them toourselves at fedex.
We'd go out back drop them in a, um, a t-check box, whatever.
Those things were called theyellow envelopes, whatever they
were and then mail them back forconsolidated billing and, and
so I think, like what's going tohappen is you're going to see

(58:21):
these players and for us, it'sabout end-to-end visibility, the
data exhaust that comes offthese businesses, but also just
making things really easy forour customers, right, like we're
only ever going to invest inthings where we feel we have a
very high, establishedrelationship.
You know, internally we callthat like a right to win and so
like with visibility, it justmade a ton of sense with
Truckers Rules, right.

(58:41):
Our customers are on ourplatform every day, millions of
loads getting posted, looking uprates.
Sure, you want to see whereyour truck is and you get an
industry leading solution to dothat.
Well, we have 100,000 carriers,almost a million and a half
trucks, in our network.
Of course, they want to helptheir working capital.
It only makes total sense.
So I'm very bullish on wherewe're positioned.

(59:01):
I think you're seeing a lot ofother players out there.
Try to make some sense of it,right.
I think earlier this year yousaw like a publicly traded bank
by a freight analytics startup,which is, I think, a little bit
of a different approach.
So I think you're going tostart to see these moves start
to coalesce.
The cart just bought three GTMSand they bought my carrier
portal a little less than a yearago, so I think you're going to

(59:22):
start to see a lot of thesemoves come together over the
next 12 to 18 months.

Speaker 2 (59:28):
Yeah, and even just the two you mentioned.
I was just going to say like,okay, I booked a load through
the marketplace.
Can I see that the truck Ibooked picked up my load and can
I make sure the truck that Isaw that picked up my load is
the one that I paid Right?
Like, just very simply speaking, like the those three things
together create so much valuejust being under one roof.

Speaker 3 (59:49):
Yeah, I think you know we when we we talked about
a bank account.
You open a bank account and yougo through a what's called a
KYB process, know your business,where we thoroughly vet you
know all the all the carriers wework with to ensure we're we
ensure we've identified theentity and the key operators
associated with that entity, andso that's a key piece of Alco

(01:00:13):
in our onboarding process.
But when you talk aboutsettlement from a marketplace
standpoint, it's liketransacting on eBay or
transacting on Amazon.
You know that both sides ofthat marketplace, you know, are,
you know, good for the goodpayment can happen and be

(01:00:34):
transacted efficiently.

Speaker 1 (01:00:36):
Is there anything like because Ben and I sit in
the broker's seat like, is thereanything that we will see an
impact on from like day one?
Like do we know?
Like hey, this carrier, thatI'm this truck I just saw on a
truck search.
Like they're, you know,verified through your service,
or is that not?
Is that, is that anything?

(01:00:57):
Is there any, I guess,immediate impact of brokers or
change for brokers, orexperience wise, or no, no news
today.

Speaker 3 (01:01:02):
I mean I think we're bringing you know Outgo under
the DAT portfolio and you knowno specific.
You know new features orannouncements.
I think that's what I'minterested in the biggest one is
like already you know, go, youknow.
Any load with that blue checkmark means it's factorable on

(01:01:23):
Outgo.
Any carrier customer can go,apply for Outgo under the DAT
factoring brand or direct atOutgocom, and that will continue
to bring the marketplace sidetogether with the payments and
factoring side of the business.
And I think that we're excitedabout what this means for

(01:01:47):
brokers long-term too, andcertainly we'd love to come back
and talk more about that oncewe're ready.

Speaker 2 (01:01:54):
That one you just said was huge, by the way, Like
the blue checkmark from thecarrier point of view right,
Like if I can see that load thatI want to run is factorable,
like there's already trust therethat I didn't have before.

Speaker 1 (01:02:05):
Yeah it's like, hey, these guys have a blue checkmark
that one doesn't.
So yeah, if I'm a carrier, it'sthe same way as when you would
see credit score days to pay.
It's one more thing that'sgoing to give a carrier I, you
know, or I guess reassurance.

(01:02:26):
Yeah, like gives them data tomake a decision based on.

Speaker 3 (01:02:29):
Yeah, and here's the other thing is that you know
getting the best loads meansacting fast, right and getting
in touch with the broker, andwhen you see that you can know
with confidence that you'regoing to be able to get paid, if
you negotiate that load andland it and like it removes a
step and simplifies the processof just finding work, getting
paid, and I think that's what acarrier cares about.

(01:02:50):
Yeah.

Speaker 4 (01:02:53):
Yeah, I think just to kind of land this all, I think
it might seem like we've gotlike a lot of not yet.
So I'll just give you twointeresting bits of context,
because markets is a prettymodest guy.
We broke Outgoes, we, thecollective new company, broke
Outgo's single day applicationrecord 30 minutes into
announcing the acquisition andwe announced it at 430 on like a

(01:03:14):
Thursday.
We broke the monthly recordMarcus by the end of that
calendar day, correct?

Speaker 3 (01:03:19):
That's right, that's right.

Speaker 4 (01:03:21):
So these guys are like training.
I'm going to probably beprocessing lead forms by the end
of the month.
The whole executive team isgoing to be sitting there
processing.
So like, that's part one of it.
Part two this has been a reallygreat experience.
So my job is out there.
You've got to find these dealsright before you can even start
working on whether they makesense.
And so Marcus and I startedtalking probably nine months ago
, and it's like, wow, this isreally really cool.

(01:03:41):
But amongst everything else,it's like then we touched back
in again.
It's like, oh, this is reallyreally cool.
And then Marcus met with myteam at Manifest and it all came
together.
I won't I don't think I'll everforget when it came together,
because it was the weekend of myson's 10th birthday, because I
remember being at his birthdayparty singing happy birthday to

(01:04:09):
get the deal moving.

Speaker 3 (01:04:09):
So what, marcus, was it like?
Seven, not even seven weeksfrom when we decided to do the
deal to closing it?
It was incredibly fast.
Yeah, I met with you and thenJeff, and it was like lightning
fast.

Speaker 4 (01:04:15):
Yeah, that's our advantage, right, roper is our
superpower, our parent company.
They do deals all day, everyday.
They do things fast.
But the reason like we've gottons of ideas around data
exhaust, like like verifying acarrier that's factored more
than five or ten times thatcarrier's not fraudulent, at
least not like systemicallyfraudulent.
So it's just, I can't wait toget access to their database so
I can start playing with thedata.
But they slapped my hand threetimes already in the last week,

(01:04:37):
so we'll get there.
It's just like let's geteveryone laptops and employee
credentials and make sure theyhave insurance before we yeah,
before we go too crazy.
First, things first, yeah Firstthing is first, and then the
next one Go to the next deal foryou on making the deal happen.

Speaker 1 (01:04:52):
That's, that's huge.
Thank you, awesome.
Well, we'll definitely leave alink for Alco in the description
or the podcast show notes.
So if you guys, alongside ournormal DAT link, that's there.
So if you, if you need accessto the greatest marketplace in
brokerage and trucking, the DATlink is there.

(01:05:14):
And now Outgo will have a linkin this episode as well.
So make sure you guys check itout, sign up and can't wait to
to be talking later this yearwith you can and see.
You know what the year inreview has looked like and,
however, things all uh pannedout.
So appreciate you both uhjoining us today.
Marcus, did you have anythingyou wanted to wrap up with, or?

Speaker 3 (01:05:36):
no, just come check us out.
We're at, uh you know, datcomslash factoring or alcocom.
Feedback Always welcome.
Love to engage through carry.
I want to reach out Love tolove, to have a conversation, so
awesome Ken, you got anything.

Speaker 4 (01:05:54):
No, still reveling in that national championship.
I think 10 and two is probablythe prediction for this year,
with a win in Ann Arbor.

Speaker 2 (01:06:02):
But always trying to get out there and play some golf
in my parka.

Speaker 4 (01:06:06):
In May I got out and played a little golf.
I got more windburn thansunburn, so maybe we'll get a
couple months of summer, as yousuggested this year.

Speaker 1 (01:06:13):
Awesome, Well, always good having you on Ben any
final thoughts.

Speaker 2 (01:06:17):
Whether you believe you can or believe you can't,
you're right.

Speaker 1 (01:06:21):
And until next time go Bills.