Flexport takes on freight world

Technology is disrupting traditional industries from printing to manufacturing – and now you can add freight forwarding to that list. Usually, freight forwarding is an industry where global supply chains are clouded by lack of visibility, confusing paperwork, complicated regulations, rampant price discrimination, and unpredictable delays. 

I spoke to Ryan Petersen, CEO and founder of Flexport, who explained the traditional freight forwarding process is compounded by importers and exporters having to manage the entire process by telephone, email, fax, or courier.  


Ryan Petersen, CEO and founder of Flexport.

Petersen’s background in importing includes working in business with his brother to buy products in China and selling them to consumers in the US. He says the hardest part they experienced was freight, in particular with the paperwork: 

“Freight is shipments over 150kg, (so) it can’t can’t go through the parcel network, it won’t go down the conveyor belt and in the world of importing its going to change hands five, six, seven times until it gets to the customer. Yet it’s an industry that relies on very antiquated ways of doing business – and as a user I just thought, wow, it shouldn’t have to be this hard.”

Several years later after launching three successful businesses, learning five languages and spending a stint as a classmate of Y Combinator’s class of 2014, Flexport was born. 

The company is considered a true disruptor  of the freight forwarding industry. Flexport offers a full suite of managed importing services, providing a dedicated account management team as well as access to custom brokerage services and competitive freight rates. The traditional means of managing a company’s global freight shipments is replaced with a simple online app that allows the customer to request and book shipments, track all global freight movements in real time, manage product data, visual their supply chain, view analytics and more – all in real time. 


Shipment details from Flexport’s app

Flexport has grown its revenue 25% monthly every month since November 2013, and the tech industry has taken notice. In 2015, Flexport announced that they had raised $6.9 million in seed funding from investors – including First Round Capital, Google Ventures, Bloomberg BETA, and Y Combinator. Since their beginning, they have grown from a small start-up to a firm of over 100 people, including sales and customer service staff in Amsterdam and Hong Kong and engineers in San Francisco – not to mention a big team of customs brokers. He says they differentiate themselves from the traditional industry via a combination of software and transportation: 

“We’re enabling some of the world’s best engineers and logistics people to work together. That is what makes us really competitive.”

Petersen explains that they also provide support to start-ups as well as big businesses – clients that traditional freight forwarders weren’t usually willing to provide competitive rates and adequate attention because they focused on serving older, more established companies:

 “We have eight publicly traded companies using us now and over 600 companies as customers. It’s hard enough to build a brand, design a product, get an audience and manufacture at scale without spending all your energy worrying about the products getting from the factory to the people.”

He adds new technologies are well-represented in their client base:

“Our customers now include companies in consumer electronics, robotics, and 3D printing along with larger e-commerce businesses that each import hundreds of millions in goods.” 

While most of their customers are currently US-based, they are in a position to help any business go global. “We can make it really easy for European companies to access the US, and for US companies reach Europe and Asia.” 


Flexport’s quote comparisons

Petersen offers some perspective on how Flexport has managed to grow so fast, admitting that “it’s very hard to get people sold on a vision… I was fortunate that I had started other businesses which helped me with credibility with industry. We spent a lot of time building relationships within the transport industry to get people to change the ways they had been working for a long time and really nuturing those relationships… relationships are an essential part of our business.”

Where to now for Flexport? Their services are clearly in demand – they have a waiting list of companies wanting to use their services – and Petersen imagines a time when they have over 1,000 staff around the world, while musing about the challenge to maintaining “our good culture as we grow.” It may not happen overnight, but it might certainly be sooner than we think as Flexport plans to disrupt freight forwarding for the long haul. 

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