Ep. #57, Part 1: Jeff Silver, CEO & Founder of Mastery Logistics Systems

Episode Transcript
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Andrew Silver (00:00):
Hey FreightPod listeners.
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(01:32):
Welcome back to another episodeof the Freight Pod.
I'm your host, andrew Silver,and I am joined today by a
special guest.
I say special guest most of thetime and every guest has been
special in its own way.
Today we're going family, andnot just any family, but the man

(01:54):
, the myth, the legend, the onewho I've been asked repeatedly
to have on the show, one of twopeople who I've been asked about
the most, him and his oldpartner, my father, dad Mr Jeff
Silver, welcome.
So I'm not sure how I want todo this.

(02:19):
Let me just break the fourthwall and let the audience.
The audience know like this ischallenging, because I know that
there's a lot people want toknow about you and those that
those that don't know youprobably mostly want to know
about your time at backhaulers,your time at coyote and now what

(02:40):
you're building, a mastery.
Those that do know you probablywant to know more deeper,
especially on the personal level, because and I'm really
grateful that I had my episodewith Cole Stevens already, which
you haven't heard yet becauseit will release two days from
when we're recording but Cole,who worked at his family

(03:02):
business Stevens Trucking, hasworked at his family business.
Stephen's Trucking has workedfor his dad for years and the
level of pride that he talksabout his father with and the
accomplishments and howimpactful he's been to him.
It's like this kind ofunabashed pride, grateful to

(03:25):
have been able to hear thatbefore coming into this episode,
because I think for me I'veshied away from being so overtly
proud to be your kid, notbecause I'm not more so, I think
because of just the insecurityof, like you know, I want to be
my own man, I want to make myown career and I just I'm glad
that I got to see Cole with justbeaming with pride, talking

(03:45):
about how impactful his dad was.
Because now I'm coming intothis and I'm going to my goal.
This episode is to show theworld kind of the brilliant man
that you are, which is usuallywith the modesty you have.
I know that's not a path youwant to go down, but I think it

(04:06):
comes out naturally in somerespect and so just let's, let's
start way back.
So I'm gonna let you walk usinto back haulers, but before
you do, take me back to college,university of michigan, 18, 19
years old.
What was life like for you backthen?

Jeff Silver (04:28):
Well, we had a great football team.
We had Anthony Carter.
This is 1980 to 84.
I really never knew what Iwanted to do when I grew up.
While I was there, I startedoff there as an econ major,

(04:53):
having no idea why I wanted todo that, and I switched ideas of
what my major was about everyfive minutes.
So I was an econ major.
I was a Russian major.
I did three semesters of eighthours of intensive Russian at

(05:15):
Michigan.
I decided, maybe I wanted to bea doctor, like my father was,
and I got to organic chemistryand that proved to be a really
bad idea and I spent a hugeamount of time trying to figure
out what I wanted to do when Igrew up and never could figure

(05:36):
out anything.
Eventually I switched.
Going into my junior year Iswitched into Michigan's
Computer and ElectricalEngineering School and this was
the days of Fortran and carryingpunch cards to the lab to try
to get your programs to run.

I have no idea what you're talking about.
Somebody will.
Some of the audience will Keepgoing.

And I'd always done super well in math.
But I got to something in myfirst semester of my first year,
or my my junior year.
But my first year at in theengineering school called
fourier systems and I justwasn't very focused and I was
doing terribly.
So I decided I better switchback into liberal arts where I

(06:31):
could do okay.
But before I did I found thisinternship programming in Paris
and I could speak French.
Well, I couldn't code, but Idid have a Pascal class and a
Fortran class.
On my transcript I'm stillconvinced that I was the only
one that applied for thatinternship because they gave it

(06:52):
to me, and so I did the firstyear of that two-year program.
Switched back, switched back,but before I left.

(07:13):
I got this internship and thenwent off to Paris for the summer
between my junior and senioryear, and that turned out to be
a pretty important move, reallyinteresting.
At the time I actually didlearn how to code.
I was part of a group that wasworking for a private company
but working with the Frenchgovernment and its education
system.
They had created their ownlanguage to write a software

(07:37):
package to help the educationalsystem of France manage its
business and the task at handwith this group of folks that I
worked with over there was totranslate all the stuff written
in that language back intoPascal, and so I actually

(07:59):
learned how to code.
There.
I learned what Paris was like atthe time.
I learned what working inFrance was like at the time.
I learned what working inFrance was like at the time, and
there it meant you started atnine o'clock.
At 10 o'clock you went and hadcoffee for a half hour.
At noon you took a two-hourlunch that was subsidized by the
government for two hours.

(08:19):
So you came back at two, youworked till 2.30, you took
another coffee till three andyou left at 4.
How we ever got anything done,I don't know.
They offered me to stay on as apermanent job, but I had signed
up to go to the University ofCopenhagen in Denmark for the

(08:41):
first semester of my senior year, so went off and did that.
That was a phenomenalexperience, and I came back and
finished my degree at Michiganwith a degree in economics,
partially because all theclasses that I took in Denmark

(09:03):
were more or less econ classesand appeared in in Danish on the
train script anyway.

So was school easy to you.

Uh, parts were, parts were challenging.
You know the all the languageclasses were were easy.
Uh, math was easy for for awhile, till I got to that really
high level stuff.
Uh, writing was always easy,but things like organic
chemistry didn't seem that wayand and actually the computer

(09:36):
classes I took back then werenot easy and languages have it's
.

it's kind of hard to fathom.
I need, I need our, I wouldlike our audience to better
understand your relationship tolanguages.
And I guess, to start, I'll saythat, as a kid, one of my
memories of any time you droveus anywhere, whether it was to
football practice, to the soccergame, to a friend's house,

(10:06):
wherever there was one of a fewthings being played in the car
Bob Marley, some other music, ormore likely, pimsleur and you
were learning a language.
How many languages do you speaktoday?

I've studied about 23.

I would say that I speak 10 or 11, probably
passably well.
What about languages is soattractive or interesting to you
?
Why?

study 23 different languages.
I don't know.
It's always just, it's beenvery, very easy for me to do at
least with both most languages.
Some of them feel like I'mbeing reminded of something that
I knew already before I wentand and learned them.
Um, it's um, it really.
You can't possibly, in myopinion, begin to understand

(11:05):
another culture unless you canunderstand the language and how
it's put together.
There are so many pieces oflanguage, for instance, in
Japanese, you never know whethera statement to call it that is

(11:31):
going to be a question, or anegative or a positive statement
, until the very end of thesentence, and that means that

(12:04):
folks there are, just by theirvery nature, developing a
different way of listening, adifferent need to listen to the
very end of a thought beforethey can possibly think about
responding or understand whatthe thought is Right.

That's really fascinating.
I especially just think abouthow, like in relationships with
people or when someone getsfrustrated, you can tell within
the first in English, like youcan tell very quickly if someone
is, you know, coming at you orif there's a reason that you
might get defensive.
But I could see how if, if youdidn't know the person's intent
until the very last word, youwould be able to listen better.

that's that's, that's, yeah, and, and that
occurs in a few languages, right, the the.
You know, in german it's alittle different where the verb
is at the end of the sentence,so you're not really sure what's
going on.
In Finnish, there are theselittle particles that come at
the end of after nouns thatdescribe that you're going to

(12:56):
somewhere, or that you're at theplace or something right, and
so there too, you're listening,completely differently from the
way we do in English and theRomance languages.

Just list the languages for me, the ones
you've studied and certainly theones you can speak passively
now.

So obviously I'm pretty good at English, my
French is very strong, mySpanish is is is very strong, um
Danish.
At one point I I was prettyfluent and could be again very
easily, and I've studied Swedishand Norwegian since then, which
are pretty easy to pick upafter.
After Danish, um, I've studieda fair amount of Italian, get by

(13:46):
pretty well in Italian, a bitof Portuguese and some Romanian,
actually Russian, for sure, andsome Polish, Studied Greek,
hebrew and Levantine, arabic,german, dutch, kiswahili, irish,

(14:14):
gaelic, mandarin.

I'm sorry.

Japanese.
There's others, I don't know,they're just not coming to mind
right now.

And, if I remember correctly, romanian is
one you learned because the somma at the restaurant you went to
all the time was remaining as awaiter, not a Somali a, and
that guy was French, obviously,but but that's why you learned
language because I couldn'tstand that I couldn't speak 10

(15:00):
minutes in his language.
I mean, it's just kind of hardto fathom the amount of time and
effort it takes to accomplishsomething like that, to go to
that length, just to speak toone person.

You know, it's not just to do that, obviously.
It definitely helps as you getolder.
It helps keep your mind nimbleand learning new things and, um,
I also find it super relaxingand empowering to be able to do
that right.
I mean, I it.
It drives me crazy when I'mwith somebody and I can't speak

(15:38):
their language.
Just bugs me yeah.

Did you ever consider a career where you
could leverage that skill?

yeah, actually I, I , I did a little, so, um, you
know when I we'll talk aboutbackhaulers, I would guess.
Well, when I ended up there, Iwasn't convinced I wanted to be
in this industry at all.
You know, my father was anophthalmic surgeon.

(16:11):
All of his friends were doctors, lawyers or architects,
certainly nobody in the truckingbusiness, not even any
salespeople, because it was sortof a bad, bad word to to him.
Um, but at one point, so when Iwas working at backhaulers, at

(16:36):
one point I found this, thistutor, uh, japanese, and I got
to be pretty good at it and Ientered a japanese speech
contest that was put on by Ithink it was marubeni america,
and I actually came in secondplace to a woman who was half
japanese.

(16:57):
I didn't think that wasactually fair, that time out.

Help me understand japanese speech.
Contest you.
You just had to.
What was speech?

in Japanese in front of a huge auditorium of
people, and they were thecompany that sponsored it.
We're judging it.

And they were judging on the quality of your
Japanese or the quality of thespeech in your Japanese.
Just had to be good enough.

It was the quality of the Japanese.

And so, and you lost.
To someone who Nash, someonewho came from Japanese roots,
that seems a little unfair.

It was a little unfair In any case, not the
point.
What I will tell you is,besides feeling like I won, that
also was the last time I wasever intimidated to speak in
front of a group of peopleCompletely lost that fear
because I went up there in frontof this whole group, of this

(17:50):
whole auditorium of people 22years old or whatever I was and
I completely forgot everything Iwas supposed to say for a good
two minutes.
That seemed like a year.
And then it came back to me andI've never been intimidated to
speak to a room of people againafter that experience, because I

(18:12):
was terrified.
But as a result of coming insecond at that point they
offered me a chance to come inand see about working there and
I was was like oh, that'd bepretty cool to get to go work
for a Japanese company and getinto some international business
.
And I walked into this roomfull of desks, with all men

(18:37):
sitting there, all in whiteshirts, sitting in desks that
all face the same way.
You know, we were at the timemy bad collar, we were wearing
jeans and everything.
These guys were all dressed up.
I'm like I am.
This is not for me.
I'm out of here.
So I thanked them, I took offand you know that was that was

(18:59):
about it for that and and reallythe thought of using language
in this business did not comeback until 99 or I guess early
2000.
After we had sold back haulersto Robinson and as you know that

(19:21):
was partially for the people,partially to take out the
competitors, partially for thetechnology CH had bought a
company called Norminter, basedin Normandy in northern France,
about six months before theybought Backhaulers and they
wanted me to go over there andlook at the possibility of what

(19:47):
would be involved in making oursystem, which was called Express
, work in the European offices.
There were 14 offices there atthe time.
The original owner was stillinvolved.
My now good friend, chrisO'Brien, was in charge of the
business, but very young.
He had moved over to Brusselsand the whole business was based

(20:10):
in in Normandy so wasn't superinvolved there yet.
But the very first day I walkedinto this room in in Normandy
where there are groups of peoplethat are talking to the
carriers in Iberia, spain andItaly.
There's groups of peopletalking to the nationals,

(20:33):
obviously the French.
There's an Eastern Europeangroup where they're speaking
Russian and Polish and Bulgarian.
There's an English group,obviously for england and
ireland and so on, and I wascouldn't even believe it was the
coolest thing that I'd seen,and um, but other than that, and

(20:54):
you know, our failedexplorations into europe with
with uh coyote, or with limitedsuccess.
At least that language hasnever been a huge part of this
business.

Yeah you, thank you.

(22:09):
So all right, well, take meback then to post-grad.
You finding backhaulers.
What did that?
What did that look like?

you know.
So I had, um, I came back from,from copenhagen, with a
semester left and no idea what Iwas going to do after that, in
the summers before I went toDenmark.
So after my freshman and aftermy sophomore year, for the first
summer I'll go back.

(22:42):
I had gone to a camp in thesummers in wisconsin and gotten
to know a bunch of people fromthe north suburbs of chicago.
One of them actually was, uh, Iwas a counselor with in in the
summer before my freshman year.
Uh, so I was in chicago, or thenorth suburbs of chicago a fair

(23:04):
amount while I was in college.
So during my, the secondsemester of my senior year, at
on maybe spring break orsomething, I went to to
northwestern and looked at thejob board as a way to maybe find
a job and, uh, I found this.

(23:25):
Actually let me go back, Imessed that up In my freshman
year.
During spring break I found ajob for the first summer after
my freshman year, after myfreshman year, and that job was
to scrub yachts in BelmontHarbor in um, in Chicago, on

(23:50):
Lake Michigan, and so I wasexcited.
I rented an apartment.
Uh, and I go, you were excitedto scrub.
You were excited to scrub thejob that was going to pay me
okay and so, okay, michigan, asyou know, gets out very early,

(24:13):
so I think april 26th, 27th orsomething like that uh, I'm in
chicago and I go to my first dayand it is cold in chicago at
the end of April and it isreally cold.
If you're scrubbing yachts,it's awful.
And so I did that the first dayand I scrubbed this boat.

(24:34):
It didn't really to me look anycleaner when I finished than
when I started a bit cleaner.
And the second day I go backand the guy's like, well, okay,
go do that boat again.
I'm like you're kidding, right.
And so I had to scrub that boatagain and I was a little faster
, so I got onto another boat,but it was mind-numbing and

(24:59):
freezing and every day I justscrubbed that same boat.
So at the end of the first weekI'm like I can't do this, so I
quit.
I had to go find another job, um, and so there at the time I'm
sure they're still there werethese different campus painter,

(25:20):
uh groups that know college kidsthat went and painted houses on
the North shore in the summers.
Uh, and there were two of them.
One was called campus painters,and then these little little
yellow trailers that you saweverywhere and parked in front
of somebody's house, and theother one was called David
Hopman associates and they hadthese uh, victorian, painted

(25:42):
lady looking trailers, that thatyou pulled around with the
paint and stuff in them.
And so I went to the DavidHopman one and they give you two
weeks where you have to go,canvas and try to get people to
sign up for jobs.
And I did it and I found someand I was assigned to a crew and
I painted houses that summer,which was way better, because

(26:05):
when you're done painting ahouse, it's painted.
It's going to stay painted fora while years in fact, and every
time you drive by you can seeit it's painted.
You did that.
I used to love it because wewere outside and the best thing
about it was that we got paid asa percentage of what the
company got for the house.

(26:26):
It was my first sort ofcommission type of a scenario.
I was the youngest guy or thenewest guy, so I got the
smallest cut, but still, and ifyou were on a good group, on a
good crew, and you wanted tostart when the sun came up and
quit when it was down already,when it was finally down right

(26:46):
In the summers.
That's a long day, but youcould burn through a lot of
houses and make a lot of moneythat way and it was wonderful.
So, as I was doing that, thesecond year I rented maybe it
was two years I did this Irented an apartment with this

(27:06):
guy that I'd been at campcouncil with and you know I kept
in touch with them when I wasback at Michigan and when I'd
gone overseas.
And eventually, during the lastsemester of my senior year,

(27:28):
when I started looking for a job, this guy, who was a year older
than me and had gone to Penn,and he said well, why don't you
come work here in this businessI'm in, it's this trucking thing
in Chicago.
So this guy's name was NolanFrankel, he's the one that

(27:51):
brought me there.
And I was ecstatic.
You know, I really had no ideawhat I wanted to do still, but
they were willing to pay me$16,000 a year, which I thought
was outstanding.
I was able to rent atwo-bedroom apartment, ground

(28:15):
floor, with parking and a yard,at 1867 Sheffield, which today
that apartment would cost fiveor six thousand dollars for sure
, four hundred and ten dollars amonth, and I was off and
running.
So I I came to chicago 1984.

(28:38):
So I came to chicago to workwith nom and this other guy
named paul lobe and uh it was,it was just the two of them.
At the time paul's father, uh,was in the sand and minerals
business and, uh, we had a small, maybe 300 feet inside of uh,

(29:03):
an office that his dad had.
His dad had one lady thathelped him and we had a young
lady that came in a couple daysa week to help get invoices out
the door.
So I show up in Chicago thevery first day of work like

(29:26):
April 28th, 6th, something likethat of 84.
And I walk into this room andthere are these slot boards on
the wall with room for thesefive by seven cards in them.
There is a group of four ofthese vertical boards for each
day of the work week and thefour columns of these slots

(29:52):
represented loads that were open, that hadn't been covered,
loads that were covered, loadsthat had been dispatched and
loads that had picked up.
Only four columns.
And the reason there were notfive?
Because when a load deliveredwe took the card off.
The board entered informationon it into two different ledger

(30:17):
books, one for the customer andhow much we were going to bill
the customer and one for thecarrier and how much we were
going to bill the customer andone for the carrier and how much
we were going to pay thecarrier.
They gave me Paul and Noam, gaveme a folding card table, a
three-button push-button phoneand a Rolodex of all the

(30:41):
trucking companies they hadworked with and told me to start
calling the trucking companiestrying to find out where they
had empty available trucks andmatch them to the loads on the
wall.
And I did that.
That was my very first day.
I was our first carrier person.

(31:02):
So if you know today, whenpeople talk about the Chicago
way of brokerage or whatever,that was just the way we
organize things.
And I did that until we hiredanother guy, john Thompson, who
was eventually to go and startAmerican Transport Group and he

(31:25):
was our carrier department.
After that we hired a bunch ofpeople to work with him and I
started selling to customers.

So what was Paul's idea for this business?
I mean, the industry had beenderegulated.
Why was Paul doing this?

What did he see as the opportunity or did he even
realize on his story?
You gotta convince him to comeon this thing there's no chance,
although granted a year.

My wife, my wife was giving me shit last night
because she's like do youremember when this thing first
started?
I said you gotta get jeff onand you said there's not a
chance in the world.
And at at that same time, youhad also only ever listened to
one podcast and it was about thecolor blue.
So things change.
Maybe, I don't know.
I did text him, and a fewmonths ago, and his response to
me was I've stayed incognito for42 years.

(32:18):
I'll do anything for you, butnot this.

It was definitely him, I'm definitely, I lean that
way, but as you know, I'm alittle less incognito than he is
.
But the whole, the way Paul gotinto the business actually
technically, maybe slightlybefore it was deregulated enough
for him to do this, but I don'tthink he realized that involved
his brother-in-law and aneighbor, one who worked for his

(32:44):
brother-in-law, and a neighborone who worked for his
brother-in-law I think was Neil,was working for I'm going to
screw this up but a company thatwas making brake shoes out in
the middle of Nebraska that hadto come back to Chicago, and his

(33:05):
neighbor who worked for amattress company that had a
private fleet that wasdelivering out into Nebraska and
coming back empty.
And Paul realized that he could, you know, help everybody and
make money doing it.
Help everybody and make moneydoing it.
So that's how he started doingit.

(33:32):
Now CH Robinson had been inbusiness since 1905, if I'm not
mistaken, they'd been around fora long time in doing this.
Before the industry wasderegulated, you were still
allowed to do freight brokerage,but only with what were called
exempt commodities, and thatincludes produce, and so they
were forever.
That's how they, you know, wereborn as a, actually as part of

(33:54):
a grocery business andeventually became a
transportation business forthese exempt commodities.
But in the early 80s, whenthings were deregulated, then
everything changed.

So Robinson had this kind of massive leg up from
having built the infrastructurefor this produce business that
by the time the industry wasderegulated it set the stage for
them to become the kind of goldstandard or the behemoth of the
industry that they are today.
When Paul started Backhaulers,that first couple years was

(34:37):
there a lot of competition orlike what were the biggest
challenges that you all ran intoas you were building the
business?

Everything was a challenge.
Carriers didn't want to workwith brokers.
Shippers generally didn't wantto work with brokers.
Things were very, verydifferent.
There were two types of twotypes of equipment, two sizes of
equipment.
Everything was a 48 footer, 45or a 48.
And there were starting to besome 53 foot trailers.

(35:06):
You know there were folks thatthat worked with Robinson.
I think Alan Lund was alreadyin business, he had left, chn
was out there and there were afew of those that were shipper
agents and things like that.
But it the big challenge wasconvincing somebody that

(35:31):
brokerages was was okay, right,and I mean the good news was
that, if you, you know we didn't, there weren't this, there
wasn't this proliferation of alot of bad actors at the time
because there weren't that manyactors, but at the same time,
people weren't used to doingthis.

Yeah, because it feels like when you say you had
to convince them to be okay withbrokers, it's not like the way
that I had to grow up convincingsomeone to work with a broker,
Because when I had to do itthere was already years of
history and a connotationsurrounding brokers that was
based on historical performanceof many of the brokers in the
space.
When you had to do it for thefirst time, it was different,

(36:16):
right, and I'm just curious whatthat was like.
If you could kind of help usget into the interaction of you
reaching out to shippers, likewhat were those rejections?
What was that like relative tohow it is today or how it was in
the last 10 years?

I think it's way different today.
I mean, today, anybody who's ashipper has hundreds or
thousands of brokers beatingdown their door, plus carriers.
Right, certainly was not thatcourse.
Um, you know, I think we werejust too young and and naive to
know we shouldn't do it.
You know, I I'll so when I I Ihad to get.

What do you mean by shouldn't?
To know we shouldn't do it,shouldn't do what?

brokers was wasn't going to work right or anything
like that.
It just, it just seemed there'sjust.
I guess it's as simple as thefact that that was what Paul
expected me to be doing was togo find customers.
Paul, a lot of Paul's customerswere originally, uh, folks that
had come from his father's sandand mineral business where he

(37:28):
dealt with all these folks thatwere involved with mining
bentonite, clay and silica, sandand calcium carbonate and all
these.
And you know his relationshipsoriginally his father's
relationships and then hisrelationships and then that had
been parlayed.
You know the way we sold thenwas get your first load from a

(37:50):
customer and immediately call ashipper on that load If that
wasn't the customer, call theconsignee on that load If that
wasn't the customer, and say,hey, we're delivering to you for
from this customer.
What else do you guys do, tellme about your business and
somehow or another.
So what paul did when I startedworking with him after my brief

(38:12):
stint on the carrier side, um,was he would give me his scraps
right and say why don't you trythis guy?
He would keep his maincustomers and and gave me one or
two of the less well-developedrelationships and says you know,
start calling on them.
The first sales call I ever wenton was up in Saginaw, michigan,

(38:38):
at the Central Foundry Divisionof General Motors.
At the Central Foundry Divisionof General Motors, and whatever
suit I had I put it on, flew upto Saginaw and American Eagle
or whatever.
I was 22.
I don't know if I turned 22 yetor not, probably not.

(38:59):
I was probably 21.
And I went and saw this guynamed Lee Neer who was just so
perplexed that such a young kidwould come up that they actually
gave us a contract.
We started hauling for GeneralMotors at least this division of
them, and that was a customerof mine for a very long time.

(39:20):
We were bringing in bentoniteclay that was being used to and
olivine sand that were beingused to line the furnaces in the
foundry.
So after that, you know, Ifound, just by accident, I went

(39:41):
to a block party, um, and founda customer that uh, well,
another Paul, actually anotherPaul's accounts that that he had
had run into.
So there was originally anotherguy involved in in backhaulers
guy named Jim Stone, uh, who wasfrom the family that at one

(40:06):
point owned Stone Container,which eventually merged with
Jefferson Smurfit and ContainerCorporation of America and all
these other companies.
But Jim introduced Paul to thepaper business as well and so at
some point I started takingover some of those paper

(40:27):
customers and that became myentire focus for the most part,
except for a few types ofcustomers where a few specific
customers.
So I developed an entirebusiness of paper customers to
where I was dealing withconverters, of paper customers

(40:47):
to where I was dealing withconverters.
I eight of my customers werewere exact replicas, or Dunder
Mifflin from the office is anexact.
I've been in that building, notexactly not the same one, for
sure, but the same people.
Those are folks I dealt withall the time, from a bunch of
different and a bunch of themwere based in in Eastern
Pennsylvania, where DunderMifflin is based on the office,

(41:10):
but paper mills as well.
I used to go to paper week inNew company a prospect about
paper rather than freight Rightand what the industry was doing

(41:35):
and how the market looked andthe market for OCC and what
diameter and basis weight paperthey were making, and just got
to to know everything about it.
And we had um, you don't know,I'm had focused in metals uh,
gary Bazelon, I think, plasticsmaybe.
So we did our own thing andthat was our focus and that was

(41:58):
the way we organized that partof the business, right To where,
if it was a paper customer Iwas calling on, if it was metal
it was non.
And then on the carrier side,we just automatically were
starting to work by backhaulright, and so many others did it
a different way, where theywould, you know, work where you

(42:19):
know, in these small mole hills,which we never thought was
going to be very efficient.
It would never work.
Obviously, we had no idea.
If you look at TQL's business,which is mostly still built that
way, it's incredibly successful, although they are, I think,
centralizing some of theircarrier stuff.
But we organized very naturally, very differently.

(42:44):
One of the things about us,these young kids that were doing
this at the time, is we spentno time worrying about what
anybody else was doing.
We never spent any timeworrying about CH.
We didn't look at other people,competitors, that were coming
up.
We just focused on what wethought was the right thing to

(43:04):
do.
You.

Thank you.
Would it have even beenpossible to to know what others
were doing at that time in thelate 80s?
Could you know what someoneelse was doing?
I mean, I'm trying to just putmyself into that environment
mentally, and and I'm trying tovisualize all of this, which, by
the way, speaking ofvisualizations like how much
hair did you have?
at this point of hair afros atthat point, but I had hockey

(44:29):
hair.
Afro was gone, but you hadhockey hair.
Okay, I was just imagining yougoing into this saginaw facility
as a 21 yearold with a suit onand, uh, I was a non-hockey
playing running the business gotit, um, okay, so so I get the.
You know, you guys were justfocused on what you were trying

(44:51):
to build and had started todevelop the Chicago way, wherein
the carrier team was generallyfocused on back halls regionally
developing yeah, and rememberis that at least very early on,
our focus really was on privatefleets.

That was the idea.
American backhaulers it wasloading private fleets on their
backhauls.
Many of those fleets don'texist anymore.
So Carnation Company hadCarnico Transport.
I mean there were the Singerbusiness Singer makes sewing
machines and made some otherstuff at the time, but they had

(45:31):
a private fleet and every timewe could we would load these
private fleets.
Culligan had a private fleet andthat was what we.
We tried to do that anytime wecould.
But we also started workingwith just about any fleet as
well.
But the idea was we just madeall the sense in the world that

(45:54):
we would have a group of folksthat were based, that were
focused on, let's say, the, thecarolinas, right, and so they
would automatically work withall the carriers that were
trying to get back to thecarolinas and all the freight
that was going to the carolinas.
So whenever they had a carrieron the phone, if that guy had a

(46:15):
truck in chicago or orwashington state or washington
missouri, it in Chicago orWashington State or Washington
Missouri, it wouldn't matter,the guy was trying to go back to
the Carolinas.
So that carrier rep that wasdealing with that Carolina
carrier would be able to offerthem all the loads without

(46:35):
restriction.
They didn't have their ownloads that they were trying to
push or sell over the benefit tothe company like a lot of the
other method do.

Yeah, and I mean that's always been a cornerstone
of, well, I guess, backcars andcertainly Coyote in your
business and your mindset ofwhat great brokerage looks like
is structuring the business in away that optimizes itself with
how you pay people, how youincentivize them in terms of

(47:11):
their responsibilities andputting them in a position to
want to make decisions thatoptimize the business or make
the business run as efficientlyas possible.
But you have seen, obviously,your credit comments to TQL's
model.
There's clearly another waythat has the potential for

(47:35):
significant success.

Yeah, I mean there's good and bad to both.
Significant success, I meanit's there's.
There's good and bad to both.
Um, there haven't been too manythat have scaled the other way,
the way tql has, thenon-chicago way, whatever that's
called.

so yeah, cradle of grace, talk to me about the
culture like define, define theamerican backhaulers culture for
me gotta look at it in twophases.

Phase one we definitely had fun.
Uh, back then we hired peoplethat we knew, or somebody knew
somebody or or whatever somebodycould walk and maybe chew gum
at the same time.
We would hire them.
We didn't know what we weredoing and so I would say it was

(48:36):
maybe a culture of people, someof whom were trying to do things
by emulation and seeing what wewere doing and trying to sort
of do the same thing.
But it was not a deliberatething, I don't you know.
We're like we sort of werestupidly thinking we could take

(48:56):
anybody and make them successful, right it just you know what we
were doing.
So that that phase sort ofended in in 91 when we hired
marianne who came in I think wehad about 80 people at the time
uh, she weeded out about half ofthose and then brought.

(49:22):
You know, she very naturallydecided that she was gonna
change the way we hired andreally for the whole industry
today and the way it recruits,invented this idea of going and
recruiting at great collegesNobody really did that before
and along with it, creating aculture that would be attractive

(49:46):
to those people.
So her idea was to try to, in away make the industry less
important.
Meaning this trucking thing,people were at the time just
starting to call it logistics.
Nobody was really calling itsupply chain anything.
Then she didn't believe shecould go sell freight to college

(50:10):
kids.
But she could sell a greatculture right.
And so I was listening to Iforget the guy's name another
one of your podcasts about theguy that had started at Calvary
and he was attracted to itbecause they drank beer on
Fridays.
Well, we did that.

(50:33):
I'm not sure if it was eververy smart or not, but it was
part of what we did and a verynatural thing and part of what
sold and brought kids fromcollege campuses to want to come
and work for us.
So when she first went out andstarted recruiting, she was also
very young.
She shows up at Indiana.
She figures you know, I'm goingto go recruit at Big Ten

(50:55):
schools, big dense schools, andIndiana university basically
laughed at her and said you'renever going to hire kids here,
cause she was going up againstthe big accounting firms, the
PNGs and those folks you know,cause IU is not that far from
Cincinnati and RJR or Altria orwhatever where college grads

(51:19):
would go out and sell cigarettesand all those things as part of
a territory, and she wassuccessful.
And two or three years later wewere the largest recruiter at
Indiana and she did the samething in Michigan State and with
that came a drastic change tothe culture and one that was

(51:43):
really based on making it adeliberate culture in the first
place.
Right, this idea of work hardand play hard and frankly I
think very often the work hardpart was what everybody looked
at.
I'm sorry, the play hard partwas what people looked at as
opposed to the the work hard.
You know, and you know notreally the folks that we would

(52:06):
hire.
They got it because so many ofthem came from a reference that
was already working for us, fromthe same fraternity, from the
same sports team.
But people will look at us andsee there's ping pong tables and
, yeah, there's beer Fridays andthere's this and that and the
other, and not realize how hardit is of a job and how much you

(52:27):
really have to work.
But for the right folks, it towork like that, that want to
work in that environment, issort of a self-propagating thing
for the type of culture thatallowed us to be super
successful.

When did you notice that the business was
taking off, that this was reallygoing to be something, that you
couldn't just be the naiverunning around we can make
anyone successful.
There's got to be a point whereyou're like, holy cow, this is
a real business.

It happened.
We made a lot of money, I madea lot of money, a lot of us made
a lot of money.
But we never thought about itthat way, really, or at least I
don't remember, none of us hadMBAs.
We eventually hired a CFO kindof guy that had an MBA, but we
thought it was silly, there wasno, what do we need an MBA for?

(53:23):
That was not a thing, right, Imean.
We, we just did things thatseem natural, like the idea of
creating our own technology.
There was no other choice forthat, for sure, there was
nothing you could buy that wasworth anything.
No other choice for that forsure, there was nothing you
could buy that was worthanything.

Uh, yeah, that that was where I was.
That was what I wanted to ask,because there had to be a point
where you're looking around andsaying, like these punch cards,
we have 80 employees, 100employees.
Like, how many freaking punchcards can we have?

so that we need to change that started very early
and you know, I actually I thinkit was the it was the very
first summer after I'm sittingthere every day calling the same
.
You know, even in that firstweek, as I sit there with that

(54:13):
um rolodex of carriers and ayellow pad of paper where I'm
writing down, I remember one ofmy first carriers I was calling
was Beeline Motor Freight, basedin Omaha, nebraska.
Eventually became CornhuskerMotor Freight, but I would call
Beeline, talk to a guy namedPaul Turley every day and say

(54:34):
where do you got trucks today?
And he said well, I've got guysin Chicago and Atlanta or
whatever, new Jersey andwherever, and which of these
guys need to get back toNebraska and which ones do you
want in Hartwell, georgia,because there was, I think, a
Monroe shock absorber plantthese guys did business with and

(54:57):
they had to get trucks there,and one in Paragoulder,
jonesboro, arkansas as as well.
So that's where their bigcustomers were based.
And so the very first day I'mriding b-line motor freight,
writing out the whole thing, andchicago, illinois, going to
paragold, arkansas, and I'mwriting this down in the size

(55:18):
trailer and it's a van right,and you know, by like the second
day and the third day I'mstarting to, I'm starting to
abbreviate stuff right, andeventually I'm abbreviating more
and more and more.
And then I started using codesfor the cities, basically or
three digit, you know.
And I started using codes forthe cities, basically or three

(55:39):
digits, you know, the firstthree letters of the city and
then the state and I've got the.
Now it's a V48 instead of 48band and all this kind of stuff.
And actually that first summer Iconvinced Paul that we need to
go buy a computer and went andbought was a Capro.

(55:59):
It was one of the firstportable computers.
It weighed about 25 pounds.
It had a keyboard that foldeddown from the front that was
attached to the computer withthis big curly cord and it had a
handle on the back so it wouldattach to this big computer so
you could take it home.

(56:20):
It was portable.
And at night I wrote our firstload matching algorithm.
Basically that provided a veryeasy, quick way to enter the
capacity hour.

(56:42):
It would spit out a green barreport for those that know what
that is that would show by date,by origin state, by destination
state, all the trucks that wehad put in there, so that
whenever a new load came in, wecould go look at that report,
find the trucks there, callthose carriers, see if they
still had the trucks.
Okay, and so the tech wasalways important between Noam

(57:02):
and I.
We were always both sort ofinvolved in that, at least until
Noam left which was prettyearly, but I don't remember
exactly what year that was andthen we had hired this guy, eric
Harrison, whom you know, and hehelped us create this system

(57:22):
that was called Express.
That became a huge part of oursuccess in that and actually a
big part of why CH bought us andis actually still involved in
behind the scenes in a lot ofwhat happens at CH today.

So that was kind of your first foray into TMS.

Yeah, but there were a few of them over the
course of time at Backhaulers.
I mean we always had something.
We always had a computer systemafter that very first start.

And you just kind of expressed, you just kind of
kept building and iterating onto make better and better over
time.

No we actually, uh, had a failed start, something
we had called, I think, falconor something like that, and then
scrap it.
And then we wrote express, andI don't remember the year we
started trying to write that,but you know, the tech was
involved was evolving quickly.
Uh, you know, there was a pointat which, I think, eric and I

(58:22):
went and looked at trying towrite the whole thing in Java
and decided to stick withMicrosoft instead.
I'd always kept my sort ofprogramming certifications up to
speed, not that I was actuallydoing it, but I always wanted to
know what the tools were thatwere involved.
And so, you know, it wasdefinitely always critical to

(58:46):
what we did, and that's in anindustry that was not doing the
same thing.

What do you think are the key elements from the
back hauler days that are stilljust very true in what makes
great brokerage?
What are the parts of backhaulers that?

you think live on in so many of the companies that
have been started now as aresult of people who once worked
for you and Paul 40 years ago.
I mean, the by far the mostimportant thing is is the people
that we hired and and and whobecame successful as part of
that and everything that they'vedone since then.
But it's, it's some of it isthe sort of method of moving
freight.
You know, we did treat carrierslike gold always.

(59:47):
That was always critical, right?
I mean, we always in ourcommission structures paid our
carrier reps at least as much asour customer reps, right, we
always made sure that thecarrier was at least as
important as the customer.
Some we talked about all thetime.
That was very different from alot of what a lot of people you

(01:00:07):
know do in the industry.
Who would you know, abuse acarrier just on a daily basis
for for profit reasons or someother stupid idea.
So I think that was that was abig part of it.

Andrew Silver (01:00:26):
What about Paul?
What made Paul so unique orgreat?

Jeff Silver (01:00:30):
at what he did.
Oh, he's a great guy he's.
He's a great relationshipperson.

Um, he has the Midas touch Everything he
touches turns to gold you andwhen you think about yourself in

(01:01:38):
those years age to 37, I thinkis when you the company sold,
you were 37.
What did your leadership stylelook like back then, when you
actually got into running thebusiness?
What kind of what kind ofleader were you?

is.
So I did communicate a lot.
I wrote the truck stops hereall the time, uh, something that
we what's that was a newsletter, uh, that we sent out every
week.
Um, I I read a couple booksover the course of my time at

(01:02:24):
Backhaulers that had a hugeimpact on me.
One was this hugely cheesy ZigZiglar book on sales.
Up until I read that book I wasstill sort of saddled with that
idea.
I'd gotten growing up thatsales is a dirty word.
You know, the one time a yearwe were allowed to go buy new

(01:02:46):
shoes, we always had to becareful that that salesman
wasn't going to talk us intobuying two pairs instead of one
kind of thing.
Right, because those salespeople are.
It was a bad word, or it was abad word.
And so I remember I had gone toSylacauga, alabama, to visit a
customer and I had to get backhome and there was a line of

(01:03:08):
thunderstorms coming acrossgoing east that was aiming at
Alabama, and the only chance Ihad to get home was to jump on a
flight to Atlanta and thenconnect there, as opposed to
waiting for the Birmingham toChicago.
That was later that night.

(01:03:29):
And so I go to Atlanta and I'msitting in Hartsfield for hours
looking for something to do, andI go into this bookstore and I
buy this book by Zig Ziglarcalled the Art of the Sale or
Art of Selling or something Iforgot what it was called, and,
for whatever reason, thatabsolutely cheesy book made
sense about.

(01:03:50):
If you're going to do it, figureout how to fall in love with it
, and if you're not going tofall in love with it, don't do
it.
You've got to treat sales asthis is something I'm going to
be better than everybody else at, and that changed the way I
thought about sales ever sincethen.
As long as you're selling aproduct that you believe in and

(01:04:11):
you know that you should be ableto convince people that it's
going to help them, and you haveto realize that maybe they
haven't heard you yet, maybethere's something that's
blocking your ability to sell tothem right now because they
don't get it yet.
Once they do get it, they willbuy from you.

(01:04:32):
They will buy what you'reselling, right?
So that was a transformativemoment for me, having read that
book.
As cheesy as it was, anotherbook that I read was Wait wait.

What other elements whether coming from the
book or just now, yourexperience do you realize make a
great salesperson?

curiosity for sure.
I remember hearing one of yourguests talk about that on your
podcast.
Somebody didn't forget it mighthave been piet, I think.
Uh talk about that and that'svery, very true.
You know, one of the things thatthat I learned it's boring,
actually now that I remember itwas boring talking about that um
, one of the things that thatyou realize is that and we used

(01:05:33):
to teach all of our traineesthis immediately when they came
in a training class, atote butthe most powerful thing that you
can do in selling is shut upand listen.
Customers don't want to hearyou talk.
They want to talk.
They want you to hear them.

(01:05:53):
And if you can learn how toshut up, you've got half the
battle won already.
Not everybody can learn how toshow up.
You've got half the battle wonalready.
Not everybody can learn how toshow up.
That's a very critical thing.
That includes learning how toask for the sale and then
shutting up and not trying totalk yourself out of it.
Silence, quiet, is veryuncomfortable for people.

(01:06:17):
That's why some people justnever shut up.
See, it gets uncomfortable, andso learning to do that is very,
very critical.
But most mostly, you know thewhole thing about having two
ears and one mouth and lettingthe two ears do the do the work

(01:06:39):
in the mouth, not right, uh?
But I think that that curiosityreally learning about what
makes a paper company work andand that is, I think, the
coolest thing about what we'redoing now at mastery, where I
get to spend my time with theceos of these trucking companies

(01:07:02):
, where every bit of that hasbeen a learning process.
Yeah, I know all the customers.
A lot of the customers theyhave were our customers before.
Trucking companies where everybit of that has been a learning
process.
Yeah, I know all the customers.
A lot of the customers theyhave were our customers before
and I know those.
I'd never gotten to reallyinteract with professional truck
drivers before and really getto know what they care about or
what it's like to run a truckingcompany.
I mean, I've learned atremendous amount from the CEOs

(01:07:28):
of these businesses and everyone of them is different, right
From Warner to Schneider toPrime, to Averitt and Covenant.
Every one of these the Canadiansthat we have CAT, canadian
American Trucking and B bisonevery one of these companies is

(01:07:48):
different.
They run completely differently, they care about different
things and that is, for me, hasmade this in some ways, even
cooler than the other thingsbefore, because we're not.
You know when you're, when youare selling freight, you're

(01:08:08):
trying to get a customer to giveyou business right and they're
going to protect themselves abit and they're going to share
certain things and not certainthings, and we had great
customer relationships.
This is a whole different story.
Once somebody has bought ourTMS and it is being embedded in
their business and becomescrucially important, the

(01:08:29):
conversations that we have withthem now are way different.
You know they're doing welldepends on our really helping
them as much as possible Atleast, that's what we're trying
to do, and really understandingtheir business is absolutely
necessary in order to do that,right At the scale that we're

(01:08:49):
talking about.

Well, especially because, in a lot of cases, as
pertains to technology, you know, the statement made by every VC
that's invested in this spaceis and it's been made by
everybody else too is that thetrucking industry has always
been so far behind on technology, and in a lot of ways, that is

(01:09:12):
definitely true.

And so the relationship, the intimacy.
Let me stop you because there'sa really important distinction
here.
Go ahead.
That is 100% true on thetrucking industry.
It is not true on the freightbrokerage industry.

I agree that's a good distinction.
Granted, I said trucking for areason.
So we were going to get to thebrokerage element and Coyote.
We're not there yet.
We've got a long way to go.
But the comment I wanted tomake was we got a long way to go
.
But the comment I wanted to makewas it's really interesting to

(01:09:57):
think about the notion of youselling into the Schneiders and
Werners as a TMS provider versusselling to Coca-Cola and Pepsi
as a brokerage provider.
Because, as you said, in thelatter example the shipper is
there's stuff that needs to stayclose to the vest and there's
stuff that there's risk involved.
They don't want to let you seeeverything.
In this environment whereyou're selling TMS and you're

(01:10:19):
becoming the nucleus of thetechnology that kind of how they
operate their business you needto know everything and in a
world where a lot of thesecompanies have never had great
technology, they don'tnecessarily know what to even
ask for or what they could have.
So it's not like theynecessarily have all the answers

(01:10:39):
.
Part of your job is to get inand understand their business so
deeply that you can put answersin front of them that they
didn't even know necessarilywhat the questions they were
going to ask are.
Does that?

make sense?
It does, and especially withthe very large trucking
companies.
Most of the very large truckingcompanies have been running on
mainframe for a very long time.

Will you define very large in your mind capacity
, like how many trucks you think?
What does that?

mean five hundred thousands, I mean a lot of the
500s are as well, but you know,the most of the large trucking
companies and the railroads haverun on mainframe technology for
a long time.
You, there was one dominant andstill is one dominant program

(01:11:30):
that is being run by the largestnot everyone, but most of the
largest trucking companies inNorth America.
It was called ICC, innovativeComputing something another
company maybe and was built torun on the AS400, the IBM
platform platform, the ibmi andI actually had the, the good

(01:11:53):
fortune of being able to have adinner with shelly simpson from,
uh, from jb hunt.
Jb hunt who told me the storyabout when JB himself was just
super proud about being thefirst company up on that in 1973
, written in COBOL, and in manyways that is what is still

(01:12:19):
running many of the largesttrucking companies, or at least
has been until we've come along,because there has not been a
good choice.
So you had a few like Schneider.
Schneider, under ChrisLofgren's leadership, got off of

(01:12:39):
the mainframe a generation agoand they did it by taking
Oracle's OTM, which was notmeant for a trucking company,
more for a shipper, and bent itand broke it and wrote millions
of lines of code around it tomake it work for a trucking
company.

What's the problem with being on the
mainframe and that?
How does that hinder theirability to run their business
now in today's environment?

Well, I guess there are two things.
Number one is I mean, this iswhat you're talking about is now
50, 60 year old technology.
It is doable, but it is veryhard to connect with other
systems.
There are software that allowsyou to do it.
In fact, with most of these bigtrucking companies we've

(01:13:34):
integrated via API with theirmainframes, using typically
MuleSoft or something to do that.
It's not a natural thing to dobecause obviously API didn't
exist at the time the stuff waswritten right.
So a couple of big problems withit.
Number one is it's notsupported, and you know, almost

(01:13:55):
all of these guys that arerunning it have had groups of
folks, their own programmers,that have done all sorts of
stuff with it and changed it somany times.
Every time new leadership wouldcome around in the company or
they'd get a new customer thatneeded this or that or whatever
that they're not supported inany way by outside companies.
Number two this was a great,great comment by a guy who's not

(01:14:24):
a customer of ours who said Ijust cannot continue to go to,
you know, to rest homes to tryto find programmers for COBOL
because nobody's making new onesanymore.
Right, nobody's going to schoolto learn COBOL now.

Young programmers are not learning how to support
that technology.
Basically.

But there has not been another system built for
these large companies untilwe've come along, which I had no
idea of.
Frankly, when we startedMastery, the idea was not to go
do that, it was to support youat Molo.

In the very first place, I did not realize what a
giant hole there was in themarketplace yeah, all right, I'm
going to take us back, becauseif we go down this we're jumping
around here and I don't want toget into we got.
We got to get to the world ofcoyote before we get to the
world of mastery, so we're goingto try to go linearly.
Um, let's wrap up on backhaulers.

(01:15:25):
The company was acquired in 99.
What was?
What was that experience like?
Were you guys looking to sellthe company?
Or robinson just came in andsaid, hey, I'm buying this thing
?
Like take me back to that.
And what that conversationlooked like between you and Paul

(01:15:46):
and the thought.

Yeah, a couple of things.
You know the we definitely werenot out looking to sell the
business.
At one point I answered a callfrom a guy named Steve YB, who
was at at CH at the time,reached out to see if if we'd
have any interest in selling,and had he called at a different

(01:16:12):
time?
Maybe I don't answer the phone,maybe nobody does, maybe Paul
picks it up and hangs it up.
I don't have any idea.
I happen to answer it.
You know, we had just at thetime, not too long before that,
unfortunately, there had been anaccident with two of Marianne's

(01:16:37):
recruiters were killed in a caraccident that while they were
out recruiting, and that reallywas a gut punch that took some
of the fun out of everythingthat we had done at Backhaulers
and the whole experience.
I'm not sure, had that nothappened, that we had been ready

(01:16:59):
to sell at that point, but thatwas part of it.
Part of it.
Um, you know, I don't know whatelse, but these guys, they, you
know this guy, steve, calledand I'm not getting into the
numbers, but I basically Iturned to Paul and said, how

(01:17:20):
much money do you want for thebusiness?
And he gave me a number and Isaid, well, if I can sell it
more for more than that, can Ikeep the rest?
And he said, sure, and so Iflew up to uh eden prairie and
met with them, showed them ourtechnology.

(01:17:44):
They had been down the path oftrying to build their own new
system.
What they had at the time wasmuch more of a way of sort of
recording loads that had alreadyhappened In fact they called
loads files at the time, loadsthat had already happened as
opposed to a way of movingfreight and actually there are

(01:18:05):
still a bunch of systems that dothat.
There was no way really at allof very quickly entering a truck
, entering a truck in their newthing they were trying to
develop, which in a funny waywas actually called Silver
Bullet.
That they thought was going tobe their silver bullet for all
their technology needs.
I wasn't stud but, um, so thisthing you would have to to put a

(01:18:31):
truck in or record a truck,which they a didn't really want
to do.
But if they did, you had toclick on the origin state and
then put in a city and thenclick on the destination state
on a map and put in or somethinglike that.
It was like four or fivescreens long just to put a truck
in.
And even back then you couldput a truck in and express in

(01:18:52):
four or five clicks if you knewthe code for the city and you
had set the defaults up for thetruck or whatever.
And so they saw that technology, they let their head of
technology go, I think maybe thenext day, and we ended up doing
a deal with them.

So I remember when Coyote was acquired and I
remember being with you and Marewhen that happened, and I also
remember selling Molo and themental anguish I went through
and what I saw you guys gothrough when contemplating

(01:19:39):
having an employee base that youdeeply care about.
That you've had all this funwith and built incredible
relationships in this journeyyou've been on together.
And then selling it and puttingit in the hands of someone who
you, you know, kind of don'tknow from adam.
To an extent, you've spent timewith them figuring it out.

(01:20:00):
What was that piece like foryou and was that a big deal?
Was that something you wereworried about culturally, or
were you worried about yourpeople and what could happen to
them by becoming part of, youknow, this much bigger company?

talk to me about that I think I was way too naive
the first time.
I did not know what that wouldfeel like.
You know, obviously, the secondtime, and you know very, very
different scenario, I think thatit's always hard and um, in

(01:20:46):
retrospect.
In retrospect, there are manyfolks that were at back haulers
that have had phenomenal careersat at Robinson and some of whom
are, are, are some of, who arevery high up in the company
today and and you know, jordancats for cash, for example, who
runs TMC.

(01:21:07):
You know it's a huge part oftheir business.
These folks have had greatcareers.
Some of those folks Pat Nolanand those kind of guys it's been
the best thing that's everhappened to them.
Marianne, I don't think lasted amonth.
She was not happy with their HRfolks.

(01:21:28):
They were completely different,different kind of people.
They didn't hire the same way.
They adopted a lot of what shedid eventually, but she was out
of there quickly.
She was not happy about it.
You know, I thought maybe Iended up being the CEO of of
Robinson If I stayed around andtried to adopt the, the CH

(01:21:51):
people myself and thought maybeI could be, you know what could
transform them.
And certainly the acquisitiontransformed them.
I don't think I did, because Ididn't last that long either.
I lasted a year.
But you know I think CHgenerally did a phenomenal job

(01:22:11):
at preserving the culture.
You know Chicago Central wasChicago Central it probably
still is really, I think, in alot of ways as people talk about
it and it was that way for avery long time.
And frankly, I also think UPSdid a great job of leaving
Coyote alone for a very longtime and you know Marianne

(01:22:32):
stayed around for three years orso.
After we sold UPS I switched tothe UPS side immediately.
So I was out of it and you knowwe had somebody that was part
of our our team won't mentionwho it is, but really wanted to

(01:22:53):
bring a lot more of the managedby EBITDA thing into the, into
the, into the business.
That I think, hurt it andotherwise UPS said it would have
stayed out of it even a littlebit more and let it.
Let it flourish the way it hadbefore.
But you know Jonathan was ableto run that thing well for a for

(01:23:14):
a long time with with some goodpeople helping them and and you
know it did really well andhopefully it will again now that
they have got drew running, therunning, the whole thing as
part of RxL.
He seems absolutely great.

Yeah, and I didn't mean to suggest any
negativity there, more so, justthe idea that you're taking your
baby, something that you'vepoured yourself into and all
these people you've pouredyourself into, and putting it in
the hands of someone else, andI was trying to understand the
mindset that was like for youthe first time around.

I guess I didn't think of it that way and it's
probably stupid, right, but Ireally thought that I would stay
with these companies thatbought them and they'd still be
working for me in a way.

Honestly, yeah, these companies that bought them
and they'd still be working forme in a way, honestly.
Yeah, that's reasonable becauseI had the same thoughts through
my own acquisition experiencetwo years ago.
But we don't need to go there.
I'm curious.
And Paul, he was selling andthen he was done.

No, he stayed around for a while.
He was pretty frustrated, wasselling and then he was done.

No, he stayed around for a while he was pretty
frustrated, honestly, uh, andthen he left.
I mean, I think it's reasonableto say that the back haulers
acquisition by robinson couldcould be.
You know, if you were to listthe most successful acquisitions
in our industry's history,that's got to be one of them,
for sure I mean it really.

If you think about it, we were.
I think we were around 300million in sales when we sold
the ch they were 2.7 billion.
When we started coyote in 06,ch was 8 billion six years later
they had gone from three toeight in that time, partially,

(01:25:09):
though.
Echo was around by then and TQLwas doing well.
They did not have a real scaleof the competitor going hard at
them Because, you know, theyembraced the tech, they embraced
the folks and it did reallywell.
They embraced the folks and itdid really well.
They also made another goodacquisition with what do you

(01:25:41):
call it?
Stefan Rambo's business,phoenix International, and they
had done some others as well,but that also was pretty
transformative for them.
Those were the two acquisitionsthat they did.
That had a huge impact.

So 25 years removed from that sale and 25 to
40 years removed from thatexperience of what you and Paul
did, together with all thoseamazing people, you know, when I
went to, when I worked atCoyote, I never.
I was a sales guy, I did anumber of roles but I never got

(01:26:20):
to go to a conference becausethere were tons of salespeople
and I just wasn't at the levelthat I would be going to any of
the conferences.
Because there were tons ofsalespeople and I just wasn't at
the level that I would be goingto any of the conferences.
And I feel like when I went,when I, when I got to Molo, the
first conference I went to was ablue Jays conference, blue J,
the, which is now E2 open.
It was called sore down inFlorida, and I remember I was

(01:26:42):
there with Vogue rich and thatwas the first time I had kind of
been exposed to the outsideworld of brokerage, outside of
the kind of cocoon of Coyote,and it was also kind of the
first time I had really beenexposed, like in depth, to your
influence on the brokerage world.
As I walked around thatconference, the number of people

(01:27:06):
who came up to me were likewait a second, you're jeff
silver's kid.
I I owe my career to him.
I owe my career to him and paul, and I wouldn't be where I am
today if it weren't for whatthey did for me and what we did
together and the doors theyopened for me.
It's and and you know anyonewho's ever tried to do like a

(01:27:27):
historical tree of the roots ofthis industry.
Everything kind of in brokerageleads back to the business you,
paul and your team builttogether.
What is it like to have hadsuch a profound impact on so
many people and to have createdso much opportunity Like?
When you look back on that now,what does that feel like?

this makes me feel old, frankly, I mean it, um.
First of all, I think there'sway too many conferences and
people spend way too much timeat these conferences just
talking to each other and nothelping their businesses very

(01:28:11):
much.
Um, but it's a deflection, what?
no, I'm gonna answer thequestion I said that's a
deflection I just wanted to Ithink there are some folks that
that they just spend atremendous amount of time doing
that and it's too much, and it'stoo much effort and wasted
money.
But, uh, because we just don'tneed that many conferences.
Some of them are good though,um.

(01:28:31):
But you know, as I had anexperience doing that not all
that long ago at food shippersor somewhere wherever I was, and
I had umpteen people, first ofall, all you know, a bunch of
old back haulers and old coyoteor former coyote people or
people that are still therecoming up, but then also people
I didn't know at all coming andsaying I wouldn't be in this

(01:28:53):
industry without you.
And it's embarrassing, for onething, but it's also cool that
I've been able to To have thatimpact, or that Paul and I were
able to, and some other folksfor sure.
Um.
But you know, when I first wentto a conference I think it was
the tia, which at the time wascalled the tbca, the

(01:29:16):
transportation brokersconference of america it wasn't
even the tia yet, and I was byfar the youngest kid there I
there were some old truckersthat were there, there were guys
that had started littlebrokerages or whatever.
That were the big shots, andit's just amazing how fast, all

(01:29:36):
of a sudden, I'm the oldest guythere.
It's just crazy.
That's mostly what it makes mefeel like.

All right, I'll accept that answer.
That's it.
Yeah, so you get kicked out ofrobinson.
I didn't get kicked out, I wasgiven the choice.

Well, I gave.
I gave john lee off the choicethat either this person who was
involved in it went or I went,and he said see you later.
So it was my choice, I did.
That was stupid.

Sorry, you didn't get kicked out.
You gave the CEO an ultimatumand he chose the option that
resulted in your departure.
Sorry, I will rephrase that.
What next?

Well, I never thought I'd be back in the
industry again.
You know, I had agreed to afive-year non-compete which,
regardless of whether it waslegal, once I signed something I
was never going to go back onit.
You know, the two littlestSilvers were born in O O and O

(01:30:49):
two.
And shout out Brian and Johnny,this the sixth and seventh of
the children and for theaudience that didn't know that,
so it was great to be able tospend time at home and coach you
in football, and you know tothe extent I was able to help do
that.
Being in another business wasthe last thing on my mind at

(01:31:16):
that point.
You know, we were tired, we hadmade a fair amount of money, we
went on vacation to Jamaica andall over the place, turkeys and
cookies, as Lexi used to callTurks and Caicos all over the
place and I wasn't too worriedabout it.

(01:31:37):
But eventually I startedgetting a little antsy and
wanted to go back to school.
My grades weren't all that greatbut I thought maybe I could get
into this, this, you know thisexecutive MBA program back in
Michigan, and I applied to itand got in.
So I started that program andmy whole idea at the time was I

(01:32:02):
would try this MBA thing becauseit didn't seem that hard and if
I liked it then maybe I'd goget a PhD and teach, which
absolutely makes no sense at allin retrospect, but because
that's not what you would dowith an MBA anyway.
But I decided to do that.
And then they let me in.
It was Michigan, so I was gone.
I wanted to go.

So what were you thinking about wanting to teach?
I had no idea.

Okay, just work with students.
So you know, and having scoffedat mbas the whole time, it was
it was a weird and differentidea and this was a.
This was an executive mbaprogram, um, but very different
from what there are today.
Because you know there were no,there was no, there was no Zoom
, there was no Teams, none ofthat existed right.

(01:32:50):
And so basically, so basicallythe you know there were two
weeks in the beginning in August, and then one week a month on
campus, and then everything elsewas basically CDs or DVDs, I
guess, cds at the time that youhad to listen to.
And you know some of the classesI thought were great and some I

(01:33:14):
thought were absolutely silly.
Like we had this marketingclass where you had to figure
out.
You know, there's a big gamebecause it's Ann Arbor, there's
a lot of automotive, and so youhad to figure out, if you spent
this much on marketing, peoplewould buy this car.
I'm thinking they're not goingto buy the car just because
you're paying for ads on TV.
Make the car better and they'llbuy the car.
It still makes sense to me.

(01:33:35):
Some of that I didn't reallylove.
I got through the finance andaccounting things which
eventually ended up being superhelpful.
Ended up being super helpful.

(01:33:56):
Um, and then the first class ofmy second term was an operations
management class it was.
It was taught by a professornamed Isaac Duenas, uh, who is
Turkish born industrial engineerguy, and the very first day of
class he throws this problem onthe board and said imagine I
forget exactly, but it'ssomething like imagine you're a

(01:34:18):
widget maker, cause everythingis widgets in in business school
.
You're a widget maker inCharlotte, north Carolina or
somewhere I forget where, andyou have a hundred loads that
you need to ship out every day.
School You're a widget maker inCharlotte, north Carolina or
somewhere I forget where, andyou have 100 loads that you need
to ship out every day and youhave five different carriers
that you can use that each hascapacity constraints and a
number of trucks that they canuse and different rates to

(01:34:39):
different states.
How do you decide which loadsto give to which characters?
And I'm like what Said straightup.
I'm listening, because one ofthe last things that we did
towards the end of Coyote'sexistence was we created what

(01:34:59):
became Robinson's TMC and we hadfolks on site to start with at
Campbell Soup and at WillametteIndustries, a paper company that
doesn't exist anymore and wewere supposedly optimizing
tendering loads out to othercarriers and we would broker

(01:35:20):
some of the loads ourselves, butotherwise we were tendering
these loads out.
Well, technically, in a time inwhich there is unlimited
capacity, the optimal answer isto give the loads to the
cheapest carrier, right, as longas they're giving you good
service.
Where there's no constraints,it's very easy.
When there's constrainedcapacity, it becomes a different

(01:35:42):
question, right.
Then you got to figure out thewhole puzzle, and so professor
duanious takes um, takes outexcel, launches excel, launches
the, the solver inside of excel,sets up the problem and solves
the thing in five minutes orwhatever I.

(01:36:04):
I was like, holy shit, this isthe coolest thing I've ever seen
, and so I decided I wanted tofind out much more about that.
So I actually, between the twoyears of my MBA, I wanted to see
if I could go learn more aboutthe specific thing.
So I found this program out atMIT, called the Masters of

(01:36:34):
Engineering in Logistics, orMLOG.
It is now called something else, it's a Master of Supply Chain.
But I was like, first of all,there's no chance I'm getting
into MIT at all because mygrades weren't that good in
college in the first place.
There's no way they're going tolet me in.
But the program looked reallycool and so I called the program

(01:36:57):
.
And I called and ended upspeaking to the director of the
program and I said you know, I'minterested in this MLOG thing
program.
And I said you know, I'minterested in this MLOG thing.
I don't think I have the gradesto get into it, but I've been
in the freight business, for Ihad this freight brokerage and
I've been in the business for,you know, 17 years.

(01:37:19):
Blah, blah, blah.
And he says wait, who is this?
And I tell him my name and hesaid, oh, you can come.
And I said what are you talkingabout?
And he said, well, you'll haveto get a 700 on the GMAT or the
GRE, either one, and then youcan come here.
I said why?
And he said well, you know, Iused to be at Ohio State and I'm

(01:37:46):
like, oh great, that's notgoing to be good.
But I used to teach a classabout American backhaulers.
I know exactly who you are, I'dlove to have you here.
So I was lucky enough, becauseof that, to be able to go there

(01:38:06):
and it was one of the bestexperiences I've ever had in my
life.
There's so many smart peoplethere I was definitely the least
smart of all of them.
The good news was that I hadsold a business so I could
afford to buy pizza and beer forthe folks that were a lot
smarter that I made sure I wasin a group with to to get that

(01:38:27):
work done.
Uh, some of them are stillfloating around the industry
because they came and workedwith us at coyote specifically,
uh, chris pickett, uh, and billgrieger, who's been on this
program, uh, so, uh, phenomenalexperience and the best you know
, the best thing career-wise outof it besides getting to know

(01:38:47):
those people was was reallyunderstanding what all the
problems are that you can solvewith optimization in this space.
And, as you know, that's a hugepart of of what we're able to
do at at mastery, where, whereour TMS mastermind actually has
embedded real optimization thatmakes sense to help anybody do

(01:39:12):
anything from putting a bunch ofpartials together to make milk
runs to assigning the rightdriver to the right load.

So at this point you'd been sitting out.
Your non-compete and curiosityhad taken you down the education
path with the MBA at Michigan,which then you saw freight
applications which brought youto MIT.

So then I went back and finished my MBA the next
year at Michigan and thendecided I wanted to go get that
PhD.
So I got into the industrialengineering PhD program at
Northwestern and was into thesecond trimester of that and at
one point Marianne said no, mas,I'm not having any more kids

(01:40:02):
and you're not getting any moredegrees, you're done.
And then we started Coyote.

What was the impetus for that decision by Mer
?
What was the impetus for thatdecision by Mer?
I think she just had it.
I don't know.
You have to ask her Aroundschool, though you just was.
So I'm curious how you stayedthe path of wanting to be a

(01:40:31):
teacher, given like thereweren't business ideas
generating, as you were at mit,meeting the driegerts and
pickets of the world first ofall, drieger was a kid.

he was 27 years old and it was a I mean I don't
think he was even that at thatpoint.
He was young.
But there were.
I mean, I still had a year onmy non-compete, I think, at that

(01:41:00):
point, and you know I wasn'tconvinced that I wanted to go be
a broker again at all.

Well, talk to me about the genesis of Coyote.
Where did the idea come from?
What was the idea too?

Well, in the very beginning the idea was to build
another company, but we werejust going to be an ATMS
business then.
Probably right, we did not knowthat we were going to be a
brokerage.
So we started off with thisidea of writing a new brokerage
system, actually sort of sold itto two different companies.

(01:41:34):
And then I had heard from oneof those, or a couple of those
folks from Robinson's office inNormandy and they were starting
a business over there and theyneeded technology.
So I agreed to make this, tomake that a system that they

(01:41:55):
would be able to use in Europeas well, uh, with with coyotes,
you know, with our, our, our TMS, that we were going to write.
So I went over there andvisited them and we hired uh, we
had hired a couple ofdevelopers that we started with,
uh at Coyote.

(01:42:16):
I'd go and visit them.
Then I went with them to go seea customer once, uh over in
France.
And then it went again and Ithink the third time I went uh
to visit them and I was withcustomers and they were getting
their offices set up and I was,you know, figuring out because

(01:42:36):
we were, I think, severelyunderpricing the software that
we were selling at the time,thinking about what the business
would be worth versus anotherbrokerage.
And on my way home from Paristhat third time I decided that I
didn't want to be a technologycompany where you just and I

(01:42:56):
didn't know what I was doing,but where you just sell the
software once and never dealwith the customer again.
I thought that's how it worked.
Obviously I have learned verydifferently this time, but I was
really.
I thought that I would not havethat same interaction,
long-term interaction withcustomers that I had in a
brokerage and I thought thelong-term financial results

(01:43:18):
wouldn't be as good, so pivotedvery quickly.
I was lucky to hear from Paulthat Mark Ford was available.
He'd been a carrier guy atBackhaulers and he was available
and looking for something to doand we were able to hire him to

(01:43:39):
be our carrier department tostart with and build it and we
were off and running with thepriority.

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