Deal Snapshot: Transflo

The Harris Williams Technology Group and Transportation & Logistics Group—two of 10 Harris Williams industry groups—often collaborate to advise companies across the supply chain and logistics technology landscape. Doing so enables Harris Williams to provide the most tailored and effective experiences and to best achieve our clients’ strategic objectives. Executives from these two Harris Williams Groups recently worked together to advise Transflo on its strategic investment from Bregal Sagemount. Transflo is a leading provider of SaaS-based driver engagement, workflow automation, connectivity, and supply chain finance solutions for carriers, drivers, brokers, and shippers. 

Here, Harris Williams senior bankers share their thoughts on why the supply chain and logistics technology space is attractive, what made Transflo a great investment opportunity, and what buyers and investors interested in supply chain and logistics technology should consider.

What makes supply chain and logistics technology an appealing area for buyers and investors?

Leed: Overall, recent supply chain issues, including growing complexity, are accelerating the need for digital transformation. Shippers and brokers are striving for greater visibility into their end-to-end goods movement. They've been investing in technology and are, in turn, forcing carriers and drivers to invest in solutions that help them better communicate shipment and other logistics data in real time with all stakeholders within the “over-the-road” freight transportation industry. This connectivity is not just about tendering freight between a buyer and seller. It’s also about showing availability and capacity in real time and communicating where goods are in the supply chain. 

Szyndlar: There are more and more technology companies that are aggregating data from the silos of the supply chain to provide organizations with a macro, end-to-end view. Such dashboards help companies make better decisions, improve operations, and manage risk. Ecosystem participants can also benefit from sharing the data with partners outside of the system. For example, a shipper may be able to communicate information to its insurance provider that may result in a shipment getting a preferential rate. There’s a lot of upside potential for technology companies and services providers that can help carriers, brokers, and shippers create value from this information.

Kidd: The significant supply chain disruptions occurring since early in the pandemic have shined a light on supply chain inefficiencies (Read Aftershock, our joint study with Kearney on supply chain recovery). Companies need to identify friction points in the movement of goods as well as in labor and capital. The more that companies can drill down into what is happening across each of the legs from raw material supply to end delivery, the more efficient they can become. So, the need for better visibility across every link of the supply chain is great. Demand for tools that can provide this level of supply chain visibility is strong and growing.

Mountcastle: The pandemic created a huge demand surge in the trucking industry across all end markets. The industry was already facing labor constraints from an aging workforce, so the combination created a perfect storm. The imbalance of supply and demand has enabled carriers to raise rates, which, in turn, is providing them with the capital to invest in technologies that will give them more visibility and help them match loads most efficiently.

What made Transflo particularly appealing to its investors?

Leed: The collaboration and visibility that Transflo offers is vital to the industry. The platform connects all parties involved in freight movement. Shippers can more easily connect with brokers and carriers and share information in real time. Brokers can make smarter decisions about filling capacity. Carriers are able to effectively match loads because they have the digital footprint of truck driver locations and can instantaneously contract freight through the system. And drivers have an all-in-one tool to manage their workflow from navigation to document and compliance management. The company evolved from providing decades of back-office and freight document management solutions into becoming one of the largest connected digital ecosystems in the trucking industry.

Kidd: Transflo’s platform provides value to its users from many perspectives beyond giving them detailed visibility. One is liquidity. A truck driver may be carrying multiple loads and making multiple stops, which means there are many forms that need to be completed before drivers can be paid. Using the platform, drivers can scan the paperwork with a mobile app and immediately submit it as pickups and deliveries occur. Traditionally manual back-office processes are also automated through Transflo. This combination allows carriers to bill customers more quickly and shorten the payment cycle that has plagued the industry for decades. 

Mountcastle: Compliance is another area where Transflo adds value. It enables carriers to monitor driver activity to promote good practices and ensure the company is compliant with Department of Transportation regulations, such as limits to how many hours a trucker can drive at a time. 

What advice do you have for prospective buyers interested in this space?

Leed: Transflo embodies many of the characteristics of winning companies in this space, particularly serving as a platform for connectivity, automation, and visibility across a supply chain ecosystem. Transflo’s focus is on “over the road” trucking, which is one of the most complicated segments. A strong solution in one transportation segment is often transferable to other segments, such as rail or ship transport, or can be focused on other end markets. So, transferability of the solution is certainly a consideration for investors interested in this sector.

Mountcastle: How customers are adopting a solution, and using it for connectivity, is very important. A company may have great technology and struggle because it doesn’t have the relationships with the carriers, brokers, and service providers it needs to gain adoption. Winning companies have the relationships to build adoption at scale within a supply chain ecosystem.

Szyndlar: Winning companies have strategies for how they will use the ecosystem data at their disposal to drive growth. They are doing more with the information they house to bring greater value to their customers. In particular, there is significant potential to offer different platform constituents a variety of analytics-based adjacent services.

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In addition to covering supply chain and logistics technology, the Harris Williams Technology Group and Transportation & Logistics Group have deep expertise in a wide range of subsectors. Learn more here:

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