Truxweb helps freight forwarders find carriers

Truxweb helps freight forwarders find carriers

by Startup Montréal
10 October 2022

This article was originally published on infobref.com

For manufacturing companies, managing the shipment of their goods to wholesalers, distributors or corporate clients can be a real headache. Montreal-based startup Truxweb offers a software service that connects them directly with carriers.

The problem Truxweb is addressing is the lack of resources available to companies that frequently have to ship products to other companies and don’t have their own trucks.

“It’s hard to know all the freight transportation options available: which routes are provided by which carriers and at what prices,” explains Mathieu van Gent, founder and CEO of Truxweb. “To get this information, one usually has to go through road freight brokers, who connect shippers and carriers. The road freight market that goes through brokers is huge, according to Mathieu van Gent: $360 billion per year in North America, including $40 billion in Canada.”

Truxweb’s solution is to replace the broker with a software service that directly connects shippers and carriers.

“Truxweb is a bit like an Airbnb for commercial transport,” suggests Mathieu van Gent. “On the one hand, each shipper creates a customer profile by indicating its needs. On the other hand, each carrier creates a supplier profile by indicating the routes and rates it offers. Our platform matches needs with available options. Customers can then purchase a shipping service there directly from the carrier.”

This online transactional service is currently dedicated:

  • business-to-business shipping (as opposed to final delivery to the consumer’s home); and
  • full truckload (FTL) shipments.

Truxweb’s business model is based on a per-transaction fee for each shipment contracted through it.

“A broker usually takes a 15 to 30% commission on the cost of a shipment,” explains Mathieu van Gent. “Our commission ranges from 8 to 12%, which is half as much.”

In addition, shippers can purchase insurance from insurers through the online service. Truxweb also offers consulting services to optimize shippers’ shipping costs. For those shipper customers who already have shipping suppliers and wish to manage transactions with them through Truxweb, the company will offer a paid subscription with a monthly fee for the use of its software service next year.

Currently, the company employs 14 people full time, including its 3 co-founders. The development of its software service was completed last March. It is already recording 30 to 40 transactions per month, generating a revenue of approximately $100,000 per month.

Truxweb is one of 20 start-ups selected this year in the Bourse+ program of Startup Montreal.

Next steps for the company:

  • Develop integration mechanisms with management software used internally by shippers and carriers;
  • Expand, early next year, the range of services covered to shipments that do not require a full truckload;
  • Obtain an initial equity financing of $1 to $1.5 million to fuel the company’s growth.