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Flock Freight Raises $113.5 Million From Group Led By SoftBank’s Vision Fund

Flock Freight, a San Diego-based logistics startup, announced Tuesday it has raised $113.5 million in funding led by SoftBank Group’s Vision Fund 2.

The investment, which also includes existing Flock Freight investors SignalFire, GLP Capital Partners, Google Ventures and Volvo Group Venture Capital, will help Flock grow its algorithm-based system for increasing the efficiency of truck operations.

Rather than the traditional hub-and-spoke system that has dominated the freight shipping market, Flock offers a way to pool shipments that are going in the same direction to use one truck.

The goal is to reduce the volume of partially loaded trucks on the road and save on fuel and terminal maintenance costs.

“Unlike the digital freight-matching category that uses technology to improve efficiency as workflow automation, Flock Freight uses technology to power a new shipping mode (shared truckload) that makes freight transportation more efficient,” Flock founder and CEO Oren Zaslansky said in a statement. Zaslansky founded the company in 2015.

Flock looks for partial loads that need to get from point A to the vicinity of point B, but would most likely be shipped on separate trucks

By consolidating partial loads, especially freight bound for a smaller city, more customers are served by one truck instead of two.

The challenge is to find those partial truckloads. That takes data analysis capacity.

Flock has reduced the time needed to find matching shipments from eight hours to less than a minute.  

The algorithms, for which patent applications are pending, enable shippers to optimize the number of routes and cut greenhouse gas emissions by up to 40%.

Last month, Flock launched an Instant Prebate incentive that reimburses shippers to unused space in truckload shipments of between 10 and 44 linear feet. Shippers can lock in truckload contracts based on their shipping plans.

Then within 24 hours of the pickup, the shipper provides an update on the load size. Flock applies the prebate, a discount of up to 50%, and finds an under-utilized truck on which to load the goods.

Bloomberg reported that the new round of funding will raise the company’s value to about $500 million, citing a person familiar with the investment.

As part of the transaction, Ervin Tu, managing partner of the SoftBank Vision Fund, will join Flock Freight’s board of directors.

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