Emerge receives $20 million in seed money from Greycroft Partners

Earlier today, Scottsdale, Arizona-based Emerge, a provider of its proprietary Private Freight Marketplace (PFM) and TMS focused on accelerating productivity and increasing visibility for supply chain stakeholders, announced it has raised $20 million in a seed round, which was led Greycroft Partners, a venture capital firm based in Los Angeles and New York, in addition to participation from other investors as well.

Emerge was established in early 2018 by Andrew Leto and Michael Leto, siblings whose transportation roots run deep, as their father operated an air freight business, followed by their ownership of GlobalTranz, a full-service 3PL focused on freight brokerage and technology, whom was acquired earlier this year by The Jordan Company, a private equity firm, for more than $400 million. 

Within Emerge’s cloud-based PFM and TMS, the company is able to provide myriad services for truckload and less-than-truckload (LTL) shippers in various ways, including combining quoting and tendering, carrier management, real-time tracking, data-driven analytics, streamlined customer billing, and being able to connect and network with new players.  The company explained that providing true real-time visibility and access to all available capacity in the U.S. are chief objectives, with its PFM and TMS platform also including chat, analytics, history, and automated lane/repeat shipment creation.

“Building one of the largest 3PLs in the country, offering less-than-truckload and full-truckload brokerage services has given us the insight to eliminate the real inefficiencies our customers experience — ultimately the platform reduces costs and positively impacts the bottom line,” said Emerge CEO Michael Leto in a statement.

Joining the Leto’s on the Emerge executive team are Jack Holmes, retired CEO of UPS Freight, as vice chairman, and Grant Crawford, former FedEx executive and industry veteran, as chief commercial officer.

In an interview, Holmes explained that a key differentiator for Emerge is in its ability to provide shippers with access to carriers within the Emerge Private Freight Marketplace.  And while there are many players trying to do the same thing, in that sense, one key difference that benefits Emerge, he said, is that, to a large degree, top-level leadership at other companies in this space came from other industries, with people attempting to leverage their technology backgrounds to satisfy, or disrupt, freight transportation and logistics.

“We are the only company [doing what we are doing] that actually has freight people and have bought into the concept of what Andrew Leto is trying to provide, and we are providing leadership with this company in a space we know very well.”

Historically, Holmes noted that freight people, or asset owners, have never liked the marketplace model and approach, adding that many wish it did not even exist. What’s more, he explained that when leading UPS Freight he was not a fan of brokerages and re-sellers, which tends to be the way in which asset-based companies view them.

“What we are doing, specifically on the LTL side, is we are providing a better experience for customers using our technology that restores the profit to the carrier,” said Holmes. “Carriers are paying much less for our services, and we get satisfied customers and provide access shippers never had before, because this is focused on the small and medium customer. We are providing technology to those customers where they have none in the first place. That is the first step in this.

Then it is taking what we learned and applying it to the truckload market with the same ideas of providing a better experience for the shippers and a better experience for the carriers.”

With Greycroft Partners’ investment into Emerge, Holmes said that it provides the opportunity for Emerge to “scale up” its business so it can hit the market running. 

Will Szczerbiak, principal at Greycroft Partners, noted in a statement that technology advancements are catalyzing all sorts of changes to how the trucking industry moves freight.

“We have looked at a bunch of other vendors and Emerge stands in a class of its own when it comes to creating a more delightful and efficient freight booking experience for shippers, carriers, and brokers alike,” he said. “It is a real platform. Andrew and Michael are true veterans in this space and are the only ones with the relationships and know how to be able to build what they’ve built.”