From Xconomy San Francisco, July 14:
How NEA Envisions the Future of Trucking, Transportation, and A.I.
The big Silicon Valley venture capital firm New Enterprise Associates (NEA) is investing in the workaday business of freight load hauling, which could hardly seem more different from the future-bending tech projects that have attracted VC money for decades.
But NEA’s leading role in the $42 million Series C financing round announced this week by New York-based startup Transfix is another example of Silicon Valley’s increasing penetration into old-line industries that have remained relatively untouched by technological disruption, compared with sectors such as telecommunications, publishing, and entertainment.
The drivers of Transfix’s entry into truckload management are machine learning and automation software, which the company deploys to create a streamlined online marketplace to connect shippers with carriers ready to transport their goods.
The tech industry has had its eye on trucking lately, because it’s considered one of the major opportunities for the development of autonomous vehicles based on advances in artificial intelligence, navigation systems, and sensor arrays. Some observers think self-driving trucks will come into use faster than driverless passenger cars.
Xconomy asked NEA about the firm’s investment strategies as it seizes current opportunities in tech and transportation, while looking forward to more sweeping transformations ahead. NEA associate Arjun Aggarwal weighed in via e-mail.
Xconomy: How does your investment in Transfix fit into NEA’s overall vision of the future of transportation, transformed by autonomous navigation, A.I., mobile, and cloud?
Arjun Aggarwal: Our broader view is really that anything that moves will eventually become autonomous, whether it is cars, trucks, drones, or planes.
That said, as we have invested in technologies that enable an autonomous future, we believe it is important to consider near-term adoption and use cases because full autonomy for consumer vehicles is a long way off.
We believe that the $726 billion trucking and logistics industry is one that will be disrupted by autonomous technologies in an accelerated fashion relative to others simply due to the massive costs and inefficiencies that characterize the market, along with up-ended consumer delivery expectations.
These factors are driving many executives in the industry to invest in technology at an increasing rate.
Transfix fits well into both NEA’s autonomous transportation thesis and the trends within the trucking and logistics industry by creating value for its customers, carriers, drivers, and society at large by eliminating waste in the supply chain through mobile technology, machine learning, and big data analytics.
The platform enables the efficient matching of shippers and carriers via an online truckload marketplace (eliminating brokers in the process), and it provides real-time monitoring, exception management, and data analytics to facilitate informed decision-making, speeding up the delivery of goods while lowering costs throughout the supply chain.
Furthermore, Transfix provides greater transparency and visibility for all players in the trucking and logistics industry, communicating vehicle location and shipment status data as well as optimizing route planning.
X: Do you see Transfix as a future business partner for autonomous truck fleet companies?
AA: We believe that the Transfix platform offers a strong value proposition for carriers and shippers alike regardless of whether trucking fleets are human-operated or autonomous.
The truckload marketplace offers a compelling and efficient way for shippers and carriers to match loads, while the real-time monitoring of shipments and analytics that Transfix offers grow even more important as truck fleets become autonomous and require continuous coordination, management, and oversight to capture the full cost benefits promised....MORE
X: What other NEA portfolio companies fit within this vision of transportation systems enhanced by A.I. and other advanced technologies?...