Gates and Be­zos go truck­ing to com­pete with ride ser­vice

The Star Early Edition - - INTERNATIONAL - Dina Bass Seat­tle

AS BILL Gates and Jeff Be­zos jockey for the des­ig­na­tion of world’s wealth­i­est man, the bil­lion­aires are united be­hind at least one lo­cal ven­ture. They’re both in­vestors in a truck­ing lo­gis­tics start-up that com­petes with Uber Tech­nolo­gies Inc.

Con­voy Inc, a 2-year-old Seat­tle com­pany, makes soft­ware that matches nearby and avail­able truck­ers to a ship­ping job. Con­voy said yes­ter­day it raised a new round of fund­ing from Bill Gates’s Cas­cade In­vest­ment and other back­ers. Gates joins Ama­ Inc’s Be­zos, who in­vested ear­lier. The lat­est fi­nanc­ing to­tals $62 mil­lion (R808m).

The in­vest­ment won’t break the bank for Gates or Be­zos, whose for­tunes are within $3 bil­lion of each other, ac­cord­ing to the Bloomberg Bil­lion­aires In­dex. But Con­voy has be­come a hot start-up in­vest­ment among fel­low bil­lion­aires. Sales­ Inc chief ex­ec­u­tive of­fi­cer Marc Be­nioff and KKR & Co co-chief ex­ec­u­tive Henry Kravis are also share­hold­ers. IAC/In­terAc­tiveCorp chair­man Barry Diller par­tic­i­pated in the new round with Gates.

Con­voy was ini­tially pitched as an “Uber for truck­ing” and has raised $80m in to­tal since start­ing in 2015. But this year, Uber rolled out its own ver­sion of on-de­mand truck­ing. The ser­vice, called Uber Freight, con­nects truck driv­ers with long-haul as­sign­ments.

There are other providers, such as Trucker Path, but Uber’s fi­nan­cial heft – hav­ing raised more than $15bn since its in­cep­tion – makes it a force. That’s de­spite dis­trac­tions posed by a law­suit claim­ing a for­mer Uber ex­ec­u­tive, who was work­ing on au­ton­o­mous truck­ing tech­nol­ogy, con­spired with the com­pany to steal trade se­crets from Al­pha­bet Inc’s Waymo. Uber de­nies wrong­do­ing.

Con­voy CEO Dan Lewis said he hopes to take ad­van­tage of Uber’s dis­trac­tions. “It isn’t clear what’s go­ing to hap­pen with Uber,” Lewis said. “The lead­er­ship of the com­pany in gen­eral is gone.”

Uber said its 2-month-old freight ser­vice has been greeted by en­thu­si­asm. “We’ve learned an in­cred­i­ble amount al­ready and are con­tin­u­ing to re­cruit the top minds in the in­dus­try as we ramp up our in­vest­ment in this tech­nol­ogy,” a spokes­woman said.


Lewis said Con­voy is ful­fill­ing thou­sands of ship­ments and gen­er­at­ing mil­lions in sales a week. He said sales vol­ume is dou­bling ev­ery quar­ter. Con­sumer gi­ants Unilever and An­heuser-Busch InBev SA have signed on as cus­tomers. Lewis de­clined to com­ment on Con­voy’s val­u­a­tion.

The new fund­ing was led by Y Com­bi­na­tor’s Con­ti­nu­ity Fund. It’s the first time the Sil­i­con Val­ley firm has in­vested in a com­pany that wasn’t in­cu­bated in its start-up pro­gramme. (Wil­lett Ad­vi­sors, the in­vest­ment arm for the per­sonal and phil­an­thropic as­sets of Michael Bloomberg, the founder and ma­jor­ity owner of Bloomberg LP, in­vests in Y Com­bi­na­tor star­tups.)

“The mar­ket op­por­tu­nity is huge, and truck­ing is a space that has not had any in­no­va­tion in two decades,” said Anu Har­i­ha­ran, a part­ner at the Y Com­bi­na­tor ven­ture fund.

The US truck­ing mar­ket is worth $800bn and is rife with in­ef­fi­ciency. Lewis said trucks are driv­ing with­out cargo about 30 per­cent of the time. – Bloomberg

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