Velant Inc., a shipment planning service for companies that use trucks to deliver their goods, has closed on $10 million in a Series B round of financing.
The Atlanta-based company’s Transportation Management Center (TMC) solution automates and optimizes key transportation functions, such as vehicle routing and scheduling, load building, fleet backhaul coordination and shipment planning. Velant claims to save companies 10% to 40% on transportation costs, while improving service and control. Velant’s sweet spot is any company has a fleet of over 100 truck and has to make multiple deliveries.
“Every truck that goes out needs a route. For a long time, that was done manually. Now we automated that and made the routes more efficient by putting more on a truck and grouping close delivering together,” says Don Ratliff, Velant’s president and CEO. “There are two big values: You don’t have to do it manually and company can save 10% to 40% of the normal cost.”
While the trucking industry seems a little off the venture capital community’s path, it is important to note that truck transportation accounts for half of the $1 trillion annual U.S. logistics costs and comprises over 80% of the nation’s freight bill, according to Cass Information Systems and ProLogis.
3i and Matrix Partners both invested in this round, which brings the company’s total funding to $17 million. “Each put up half. Matrix led the was the Series A and a couple angle investors came in on that round, which closed in Sept. 2000,” says Ratliff. The company was founded in February 2000.
Velant signed its first customer in November 2001 and started seeing revenue in December 2001. Thus far, the company has only announced Wise Foods as a customer and is working with a number of undisclosed customers as well as potential customers.
Additionally, Velant plans to use the proceeds from this deal to grow its marketing department. It expects to add 20 to 30 employees to its 50-plus roster by year-end.
Velant does not anticipate another dip in the private equity pool, but it is not ruling it out either. “I don’t know yet what will happen next, it depends on the economy. That is our biggest challenge. When it gets better, a lot of today’s business challenges go away,” says Ratliff.
Contact Danielle Fugazy