Beacon, a U.K.-based freight forwarding and supply chain finance company, has raised more than $15 million in a Series A funding round, with investment coming from Amazon CEO Jeff Bezos and U.S. venture capital firm 8VC. The money raised will be invested in new hires, technology and market expansion.
CEO Fraser Robinson and chief operating officer Dmitri Izmailov, both former Uber executives, founded Beacon in 2018 to simplify how companies import and export goods globally. They were joined by chief technology officer Pierre Martin, who previously was head of software engineering for Amazon’s package and freight transport technology.
The company uses artificial intelligence, search optimization, data science, cloud and automation technologies to improve operational efficiencies across global ocean, air and truck freight forwarding. The logistics platform is designed to combine a real-time view of the global delivery of cargo and a marketplace view of global shipping costs and prices, and leverage machine learning to optimize shipping routes and processes for improved cost, speed and predictability.
The amount Bezos himself has invested in the company is unknown, but his backing of a logistics services company can go a long way into building Beacon’s credibility. Plus, Bezos and Amazon stand to benefit from learning more about the technology’s shipping route optimization capabilities for the e-commerce titan’s current challenges. Amazon has recently been tied to reports that it is in advanced talks to buy autonomous vehicle technology provider Zoox as it continues to seek ways to beef up its own logistics operations amid increased spending throughout the COVID-19 pandemic.
Beacon also focuses on the issue of cash flow for importers—suppliers often require payment before goods have shipped, making for cash crunches given the long shipping periods to bring goods in from overseas. With its supply chain finance offering, Beacon offers qualifying customers financing within 72 hours, which also entitles them to shipping discounts.
The company sees a major opportunity in what it calls a “highly fragmented” freight forwarding market, citing that the top ten forwarders global only have 43 percent combined share.
“The traditional freight forwarder model remains surprisingly analogue, using systems and processes that are slow and inefficient, with opaque pricing and limited use of technology,” Robinson said. “Our goal is to disrupt the trillion-dollar freight forwarding market by vastly improving the experience for importers and exporters with a more transparent and smarter shipping product. We also believe that our ability to offer supply chain finance can be transformative for our customers by allowing them to better control and manage their cash flow. We have built a team with deep expertise in technology, logistics and finance in a short period of time—these new funds will enable us to continue to strengthen that team and invest in our technology, while also increasing our international presence.”
Robinson also cited the current acceleration of digitization due to COVID-19 as a reason why freight forwarders will need access to real-time data to ultimately increase delivery speed and decrease costs.
Participants in Beacon’s initial seed round included Uber founders Travis Kalanick and Garrett Camp, former Google CEO Eric Schmidt, as well as venture firms such as Neo, Red Sea Ventures, Manta Ray and FJ Labs.