The United States relies on hundreds of thousands of refrigerated truck operators to ensure that vital goods, like vaccines and fresh produce, are delivered safely to consumers. Nearly 96 percent of the trucking companies that power our supply chain manage a fleet with fewer than ten trucks, according to the American Trucking Association. While these small businesses are essential to the freight industry, they lack access to digital tools and financial services that can help them run more efficiently and grow.
This week, we announced our investment in Channel19, the first digital platform for refrigerated trucking companies, and our first investment in the US logistics industry. Channel19 aims to help small truckers to strengthen their businesses by overcoming operational challenges and increasing their revenue. We’re thrilled to partner with Tony Singh, Duane Moore, and the rest of the Channel19 team as they create opportunities for small business owners to increase revenue, streamline operations, and access the financial services they need to grow their businesses.
We’re excited to invest in Channel19 as the platform:
Addresses pain points for small, refrigerated trucking businesses
The US trucking industry is highly fragmented, with nearly 96 percent of operators managing fewer than ten trucks. While larger trucking companies typically employ someone to search for, bid on, and book routes for their drivers, small companies often have an owner-operator who is trying to multitask. Channel19 streamlines the dispatch process by aggregating refrigerated freight opportunities found across hundreds of load boards, recommending the best routes for customers, and enabling them to book work digitally.
For refrigerated truckers, proper temperature management is equally vital. Channel19 is designed to help refrigerated truckers seamlessly manage their refrigeration unit and protect their cargo, which is usually their most expensive asset. By saving operators time that was previously spent on manual tasks, Channel19 allows them to instead focus on growing their businesses.
Provides MSMEs with access to well-designed, affordable financial services
Trucking is a capital-intensive industry. Coupled with high gas prices and a harsh freight recession, managing cash flow can be extremely difficult for these small businesses. Shippers typically offer 30-day payment terms, which is too long to wait for small trucking companies operating on thin margins. This has made it commonplace for truckers to use factoring companies, which typically charge two to five percent of the invoice value but layer on hidden fees and lock truckers into predatory long-term contracts. These contracts result in some customers paying up to ten percent of the invoice value to access the cash they need to operate. Channel19 accelerates cash flow for these companies through their simple, easy-to-use factoring product, which leverages transaction data on the platform to validate invoices and reduce the cost of accessing capital.
Reaches a new generation of truckers
The median age for a truck driver in the United States is 47 years old, which is five years older than the average American worker. As this population heads toward retirement and the shortage of drivers continues to grow, these roles are increasingly filled by Central American, Indian, and Eastern European immigrants. In Texas, the epicenter of US trucking, the number of immigrant drivers has nearly tripled since 2000. According to a Houston-based resettlement agency, many of these newcomers get their footing in the industry by working for a friend or family member’s trucking business before starting their own. Channel19 is dedicated to reaching these immigrant entrepreneurs and providing them with a pathway to earn more money, save time, and accelerate cash flow.
Brings a team with deep industry experience
Tony Singh, CEO and co-founder of Channel19, has been in and around the trucking industry his entire life. While growing up in Northern India, he was exposed to the inner workings of his family’s trucking business. After immigrating to the US, his family remained in the trucking industry, gaining experience in fleet operations, repairs, and other aspects of the sector. Tony’s first-hand exposure to the challenges that these small businesses face led him to build Channel19 alongside his co-founder, Duane Moore. Duane, CTO of Channel19, was one of the first engineers at Clover and brings more than 20 years of computer engineering experience to the team.
Digital tools have the potential to transform and strengthen small businesses in the refrigerated freight sector. We’re proud to support Channel19’s journey to build a user-friendly platform that allows truck owners to make informed decisions about their business, alleviates operational pain points, increases their profitability, and provides embedded financial services.