Digital trucking platform TruckSmarter announced Monday that it has closed a $50 million debt facility with CoVenture to grow the company’s services, including an option to extend the facility to $100 million. The San Francisco-based company last raised $25 million in 2022.
“Amid challenges for the trucking industry over the past several years, TruckSmarter has demonstrated how technological innovation and its commitment to drivers is pivotal when developing a disruptive solution that addresses industry needs. …We could not be more excited about partnering with the TruckSmarter team as they embark on this next stage of growth and as the industry makes its recovery,” said Lei Tie, managing director of CoVenture.
The financing will support TruckSmarter in expanding its quick pay and factoring business, which has been a key driver of its recent growth and need for debt.
Related: TruckSmarter raises $25M to grow owner-operator ‘ecosystem’
“The factoring and quick pay business just continues to grow and drive a ton of traction. We are now pacing four-times year-over-year growth,” Daniel Kao, co-founder and CEO told FreightWaves. “This will help us finance a lot more receivables and continue growing this core of our business.”
TruckSmarter’s strategy focuses on solving pain points for small carriers and owner-operators.
The company’s load board serves as both a customer acquisition tool for carriers and a way to gather data for underwriting its financial business.
The company’s quick pay service has become popular during the market downturn, allowing truckers to receive payment within hours or a day, addressing critical cash flow needs in the industry. TruckSmarter has also built a fuel network that offers discounts without relying on credit cards, reducing fees and maximizing customer savings.
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“Rates are low and many trucks are running their business on razor thin margins. The ability for them to get access to money faster so they can reinvest it into their business and keep their assets moving is a big part of why we entered this space and why our business has been growing so well,” said Kao.
In the future, TruckSmarter plans to use its new financing to develop more products, such as lines of credit for fuel purchases. The company sees potential in the growing segment of carriers with less than 10 trucks and aims to provide the tools these small businesses need to succeed.
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