The Freight Pod
The Freight Pod is a deep dive into the journeys of the transportation and logistics industry’s brightest minds and innovators. The show is hosted by Andrew Silver, former founder and CEO of MoLo Solutions, one of the fastest-growing freight brokerages in the industry. His guests will be CEOs, founders, executives, and leaders from some of the most successful freight brokerages, trucking companies, manufacturers, and technology companies that support this great industry. Andrew will interview his guests with a focus on their life and how they got to where they are today, unlocking the key ingredients that helped them develop into the leaders they are now. He will also bring to light the fascinating stories that helped mold and shape his experiences.
The Freight Pod
Ep. #57, Part 1: Jeff Silver, CEO & Founder of Mastery Logistics Systems
In this special two-part episode, Andrew sits down with his dad, Jeff Silver, CEO and founder of Mastery Logistics Systems. This is part one, beginning with Jeff’s life in 1980 at the University of Michigan.
In 1984, Jeff joined Paul Loeb and others in building what became American Backhaulers, one of the industry’s first and most successful freight brokerages. C.H. Robinson acquired American Backhaulers in 1999, and a key driver of that industry-changing deal was Express, the technology system built by Jeff and his team that helped accelerate C.H. Robinson’s growth for years to come.
In this episode, Jeff also shares:
- His college years at the University of Michigan, passion for language, and early jobs scrubbing yachts and painting houses.
- How he got started at American Backhaulers and what led him to write the industry’s first load-matching algorithm.
- The lasting impacts of American Backhaulers that live on in the industry today and how its acquisition by C.H. Robinson unfolded.
- What makes a great seller and the book that changed his view of sales.
- His time at MIT, pursuing a master’s in engineering and logistics, and the path to founding Coyote Logistics, which was acquired by UPS in 2015.
- The challenges that Mastery Logistics Systems is tackling today for major trucking companies like Werner, Schneider, and others.
Follow The Freight Pod and host Andrew Silver on LinkedIn.
*** This episode is brought to you by Rapido Solutions Group. I had the pleasure of working with Danny Frisco and Roberto Icaza at Coyote, as well as being a client of theirs more recently at MoLo. Their team does a great job supplying nearshore talent to brokers, carriers, and technology providers to handle any role necessary, be it customer or carrier support, back office, or tech services. Visit gorapido.com to learn more. ***
A special thanks to our additional sponsors:
- Cargado – Cargado is the first platform that connects logistics companies and trucking companies that move freight into and out of Mexico. Visit cargado.com to learn more.
- Greenscreens.ai – Greenscreens.ai is the AI-powered pricing and market intelligence tool transforming how freight brokers price freight. Visit greenscreens.ai/freightpod today!
- Metafora – Metafora is a technology consulting firm that has delivered value for over a decade to brokers, shippers, carriers, private equity firms, and freight tech companies. Check them out at metafora.net. ***
Hey FreightPod listeners. Before we get started today, let's do a quick shout out to our sponsor, rapido Solutions Group. Rapido connects logistics and supply chain organizations in North America with the best near shore talent to scale efficiently and deliver superior customer service. Rapido works with businesses from all sides of the logistics industry. This includes brokers, carriers and logistics software companies. This includes brokers, carriers and logistics software companies. Rapido builds out teams with roles across customer and carrier sales and support, back office administration and technology services. The team at Rapido knows logistics and people. It's what sets them apart. Rapido is driven by an inside knowledge of how to recruit, hire and train within the industry and a passion to build better solutions for success. The team is led by CEO Danny Frisco and COO Roberto Lacazza, two guys I've worked with from my earliest days in the industry at Coyote. I have a long history with them and I trust them. I've even been a customer of theirs at Molo and let me tell you they made our business better. In the current market, where everyone's trying to do more with less and save money, solutions like Rapido are a great place to start To learn more. Check them out at gorapidocom. That's gorapidocom.
Andrew Silver:Welcome back to another episode of the Freight Pod. I'm your host, andrew Silver, and I am joined today by a special guest. I say special guest most of the time and every guest has been special in its own way. Today we're going family, and not just any family, but the man, the myth, the legend, the one who I've been asked repeatedly to have on the show, one of two people who I've been asked about the most, him and his old partner, my father, dad Mr Jeff Silver, welcome. So I'm not sure how I want to do this. Let me just break the fourth wall and let the audience. The audience know like this is challenging, because I know that there's a lot people want to know about you and those that those that don't know you probably mostly want to know about your time at backhaulers, your time at coyote and now what you're building, a mastery.
Andrew Silver:Those that do know you probably want to know more deeper, especially on the personal level, because and I'm really grateful that I had my episode with Cole Stevens already, which you haven't heard yet because it will release two days from when we're recording but Cole, who worked at his family business Stevens Trucking, has worked at his family business. Stephen's Trucking has worked for his dad for years and the level of pride that he talks about his father with and the accomplishments and how impactful he's been to him. It's like this kind of unabashed pride, grateful to have been able to hear that before coming into this episode, because I think for me I've shied away from being so overtly proud to be your kid, not because I'm not more so, I think because of just the insecurity of, like you know, I want to be my own man, I want to make my own career and I just I'm glad that I got to see Cole with just beaming with pride, talking about how impactful his dad was. Because now I'm coming into this and I'm going to my goal.
Andrew Silver:This episode is to show the world kind of the brilliant man that you are, which is usually with the modesty you have. I know that's not a path you want to go down, but I think it comes out naturally in some respect and so just let's, let's start way back. So I'm gonna let you walk us into back haulers, but before you do, take me back to college, university of michigan, 18, 19 years old. What was life like for you back then?
Jeff Silver:Well, we had a great football team. We had Anthony Carter. This is 1980 to 84. I really never knew what I wanted to do when I grew up. While I was there, I started off there as an econ major, having no idea why I wanted to do that, and I switched ideas of what my major was about every five minutes. So I was an econ major. I was a Russian major. I did three semesters of eight hours of intensive Russian at Michigan. I decided, maybe I wanted to be a doctor, like my father was, and I got to organic chemistry and that proved to be a really bad idea and I spent a huge amount of time trying to figure out what I wanted to do when I grew up and never could figure out anything. Eventually I switched. Going into my junior year I switched into Michigan's Computer and Electrical Engineering School and this was the days of Fortran and carrying punch cards to the lab to try to get your programs to run.
Andrew Silver:I have no idea what you're talking about. Somebody will. Some of the audience will Keep going.
Jeff Silver:And I'd always done super well in math. But I got to something in my first semester of my first year, or my my junior year. But my first year at in the engineering school called fourier systems and I just wasn't very focused and I was doing terribly. So I decided I better switch back into liberal arts where I could do okay. But before I did I found this internship programming in Paris and I could speak French. Well, I couldn't code, but I did have a Pascal class and a Fortran class. On my transcript I'm still convinced that I was the only one that applied for that internship because they gave it to me, and so I did the first year of that two-year program.
Jeff Silver:Switched back, switched back, but before I left. I got this internship and then went off to Paris for the summer between my junior and senior year, and that turned out to be a pretty important move, really interesting. At the time I actually did learn how to code. I was part of a group that was working for a private company but working with the French government and its education system. They had created their own language to write a software package to help the educational system of France manage its business and the task at hand with this group of folks that I worked with over there was to translate all the stuff written in that language back into Pascal, and so I actually learned how to code. There.
Jeff Silver:I learned what Paris was like at the time. I learned what working in France was like at the time. I learned what working in France was like at the time, and there it meant you started at nine o'clock. At 10 o'clock you went and had coffee for a half hour. At noon you took a two-hour lunch that was subsidized by the government for two hours. So you came back at two, you worked till 2.30, you took another coffee till three and you left at 4. How we ever got anything done, I don't know. They offered me to stay on as a permanent job, but I had signed up to go to the University of Copenhagen in Denmark for the first semester of my senior year, so went off and did that. That was a phenomenal experience, and I came back and finished my degree at Michigan with a degree in economics, partially because all the classes that I took in Denmark were more or less econ classes and appeared in in Danish on the train script anyway.
Andrew Silver:So was school easy to you.
Jeff Silver:Uh, parts were, parts were challenging. You know the all the language classes were were easy. Uh, math was easy for for a while, till I got to that really high level stuff. Uh, writing was always easy, but things like organic chemistry didn't seem that way and and actually the computer classes I took back then were not easy and languages have it's.
Andrew Silver:it's kind of hard to fathom. I need, I need our, I would like our audience to better understand your relationship to languages. And I guess, to start, I'll say that, as a kid, one of my memories of any time you drove us anywhere, whether it was to football practice, to the soccer game, to a friend's house, wherever there was one of a few things being played in the car Bob Marley, some other music, or more likely, pimsleur and you were learning a language. How many languages do you speak today?
Jeff Silver:I've studied about 23.
Andrew Silver:I would say that I speak 10 or 11, probably passably well. What about languages is so attractive or interesting to you? Why?
Jeff Silver:study 23 different languages. I don't know. It's always just, it's been very, very easy for me to do at least with both most languages. Some of them feel like I'm being reminded of something that I knew already before I went and and learned them. Um, it's um, it really. You can't possibly, in my opinion, begin to understand another culture unless you can understand the language and how it's put together. There are so many pieces of language, for instance, in Japanese, you never know whether a statement to call it that is going to be a question, or a negative or a positive statement, until the very end of the sentence, and that means that folks there are, just by their very nature, developing a different way of listening, a different need to listen to the very end of a thought before they can possibly think about responding or understand what the thought is Right.
Andrew Silver:That's really fascinating. I especially just think about how, like in relationships with people or when someone gets frustrated, you can tell within the first in English, like you can tell very quickly if someone is, you know, coming at you or if there's a reason that you might get defensive. But I could see how if, if you didn't know the person's intent until the very last word, you would be able to listen better.
Jeff Silver:that's that's, that's, yeah, and, and that occurs in a few languages, right, the the. You know, in german it's a little different where the verb is at the end of the sentence, so you're not really sure what's going on. In Finnish, there are these little particles that come at the end of after nouns that describe that you're going to somewhere, or that you're at the place or something right, and so there too, you're listening, completely differently from the way we do in English and the Romance languages.
Andrew Silver:Just list the languages for me, the ones you've studied and certainly the ones you can speak passively now.
Jeff Silver:So obviously I'm pretty good at English, my French is very strong, my Spanish is is is very strong, um Danish. At one point I I was pretty fluent and could be again very easily, and I've studied Swedish and Norwegian since then, which are pretty easy to pick up after. After Danish, um, I've studied a fair amount of Italian, get by pretty well in Italian, a bit of Portuguese and some Romanian, actually Russian, for sure, and some Polish, Studied Greek, hebrew and Levantine, arabic, german, dutch, kiswahili, irish, gaelic, mandarin.
Andrew Silver:I'm sorry.
Jeff Silver:Japanese. There's others, I don't know, they're just not coming to mind right now.
Andrew Silver:And, if I remember correctly, romanian is one you learned because the somm a at the restaurant you went to all the time was remaining as a waiter, not a Somali a, and that guy was French, obviously, but but that's why you learned language because I couldn't stand that I couldn't speak 10 minutes in his language. I mean, it's just kind of hard to fathom the amount of time and effort it takes to accomplish something like that, to go to that length, just to speak to one person.
Jeff Silver:You know, it's not just to do that, obviously. It definitely helps as you get older. It helps keep your mind nimble and learning new things and, um, I also find it super relaxing and empowering to be able to do that right. I mean, I it. It drives me crazy when I'm with somebody and I can't speak their language. Just bugs me yeah.
Andrew Silver:Did you ever consider a career where you could leverage that skill?
Jeff Silver:yeah, actually I, I, I did a little, so, um, you know when I we'll talk about backhaulers, I would guess. Well, when I ended up there, I wasn't convinced I wanted to be in this industry at all. You know, my father was an ophthalmic surgeon. All of his friends were doctors, lawyers or architects, certainly nobody in the trucking business, not even any salespeople, because it was sort of a bad, bad word to to him. Um, but at one point, so when I was working at backhaulers, at one point I found this, this tutor, uh, japanese, and I got to be pretty good at it and I entered a japanese speech contest that was put on by I think it was marubeni america, and I actually came in second place to a woman who was half japanese. I didn't think that was actually fair, that time out.
Andrew Silver:Help me understand japanese speech. Contest you. You just had to. What was speech?
Jeff Silver:in Japanese in front of a huge auditorium of people, and they were the company that sponsored it. We're judging it.
Andrew Silver:And they were judging on the quality of your Japanese or the quality of the speech in your Japanese. Just had to be good enough.
Jeff Silver:It was the quality of the Japanese.
Andrew Silver:And so, and you lost. To someone who Nash, someone who came from Japanese roots, that seems a little unfair.
Jeff Silver:It was a little unfair In any case, not the point. What I will tell you is, besides feeling like I won, that also was the last time I was ever intimidated to speak in front of a group of people Completely lost that fear because I went up there in front of this whole group, of this whole auditorium of people 22 years old or whatever I was and I completely forgot everything I was supposed to say for a good two minutes. That seemed like a year. And then it came back to me and I've never been intimidated to speak to a room of people again after that experience, because I was terrified. But as a result of coming in second at that point they offered me a chance to come in and see about working there and I was was like oh, that'd be pretty cool to get to go work for a Japanese company and get into some international business. And I walked into this room full of desks, with all men sitting there, all in white shirts, sitting in desks that all face the same way. You know, we were at the time my bad collar, we were wearing jeans and everything. These guys were all dressed up. I'm like I am. This is not for me. I'm out of here. So I thanked them, I took off and you know that was that was about it for that and and really the thought of using language in this business did not come back until 99 or I guess early 2000.
Jeff Silver:After we had sold back haulers to Robinson and as you know that was partially for the people, partially to take out the competitors, partially for the technology CH had bought a company called Norminter, based in Normandy in northern France, about six months before they bought Backhaulers and they wanted me to go over there and look at the possibility of what would be involved in making our system, which was called Express, work in the European offices. There were 14 offices there at the time. The original owner was still involved. My now good friend, chris O'Brien, was in charge of the business, but very young. He had moved over to Brussels and the whole business was based in in Normandy so wasn't super involved there yet.
Jeff Silver:But the very first day I walked into this room in in Normandy where there are groups of people that are talking to the carriers in Iberia, spain and Italy. There's groups of people talking to the nationals, obviously the French. There's an Eastern European group where they're speaking Russian and Polish and Bulgarian. There's an English group, obviously for england and ireland and so on, and I was couldn't even believe it was the coolest thing that I'd seen, and um, but other than that, and you know, our failed explorations into europe with with uh coyote, or with limited success. At least that language has never been a huge part of this business.
Andrew Silver:Yeah you, thank you. So all right, well, take me back then to post-grad. You finding backhaulers. What did that? What did that look like?
Jeff Silver:you know. So I had, um, I came back from, from copenhagen, with a semester left and no idea what I was going to do after that, in the summers before I went to Denmark. So after my freshman and after my sophomore year, for the first summer I'll go back. I had gone to a camp in the summers in wisconsin and gotten to know a bunch of people from the north suburbs of chicago. One of them actually was, uh, I was a counselor with in in the summer before my freshman year.
Jeff Silver:Uh, so I was in chicago, or the north suburbs of chicago a fair amount while I was in college. So during my, the second semester of my senior year, at on maybe spring break or something, I went to to northwestern and looked at the job board as a way to maybe find a job and, uh, I found this. Actually let me go back, I messed that up In my freshman year. During spring break I found a job for the first summer after my freshman year, after my freshman year, and that job was to scrub yachts in Belmont Harbor in um, in Chicago, on Lake Michigan, and so I was excited. I rented an apartment. Uh, and I go, you were excited to scrub.
Jeff Silver:You were excited to scrub the job that was going to pay me okay and so, okay, michigan, as you know, gets out very early, so I think april 26th, 27th or something like that uh, I'm in chicago and I go to my first day and it is cold in chicago at the end of April and it is really cold. If you're scrubbing yachts, it's awful. And so I did that the first day and I scrubbed this boat. It didn't really to me look any cleaner when I finished than when I started a bit cleaner. And the second day I go back and the guy's like, well, okay, go do that boat again. I'm like you're kidding, right. And so I had to scrub that boat again and I was a little faster, so I got onto another boat, but it was mind-numbing and freezing and every day I just scrubbed that same boat. So at the end of the first week I'm like I can't do this, so I quit.
Jeff Silver:I had to go find another job, um, and so there at the time I'm sure they're still there were these different campus painter, uh groups that know college kids that went and painted houses on the North shore in the summers. Uh, and there were two of them. One was called campus painters, and then these little little yellow trailers that you saw everywhere and parked in front of somebody's house, and the other one was called David Hopman associates and they had these uh, victorian, painted lady looking trailers, that that you pulled around with the paint and stuff in them. And so I went to the David Hopman one and they give you two weeks where you have to go, canvas and try to get people to sign up for jobs. And I did it and I found some and I was assigned to a crew and I painted houses that summer, which was way better, because when you're done painting a house, it's painted. It's going to stay painted for a while years in fact, and every time you drive by you can see it it's painted.
Jeff Silver:You did that. I used to love it because we were outside and the best thing about it was that we got paid as a percentage of what the company got for the house. It was my first sort of commission type of a scenario. I was the youngest guy or the newest guy, so I got the smallest cut, but still, and if you were on a good group, on a good crew, and you wanted to start when the sun came up and quit when it was down already, when it was finally down right In the summers. That's a long day, but you could burn through a lot of houses and make a lot of money that way and it was wonderful.
Jeff Silver:So, as I was doing that, the second year I rented maybe it was two years I did this I rented an apartment with this guy that I'd been at camp council with and you know I kept in touch with them when I was back at Michigan and when I'd gone overseas. And eventually, during the last semester of my senior year, when I started looking for a job, this guy, who was a year older than me and had gone to Penn, and he said well, why don't you come work here in this business I'm in, it's this trucking thing in Chicago. So this guy's name was Nolan Frankel, he's the one that brought me there. And I was ecstatic. You know, I really had no idea what I wanted to do still, but they were willing to pay me $16,000 a year, which I thought was outstanding. I was able to rent a two-bedroom apartment, ground floor, with parking and a yard, at 1867 Sheffield, which today that apartment would cost five or six thousand dollars for sure, four hundred and ten dollars a month, and I was off and running. So I I came to chicago 1984.
Jeff Silver:So I came to chicago to work with nom and this other guy named paul lobe and uh it was, it was just the two of them. At the time paul's father, uh, was in the sand and minerals business and, uh, we had a small, maybe 300 feet inside of uh, an office that his dad had. His dad had one lady that helped him and we had a young lady that came in a couple days a week to help get invoices out the door. So I show up in Chicago the very first day of work like April 28th, 6th, something like that of 84.
Jeff Silver:And I walk into this room and there are these slot boards on the wall with room for these five by seven cards in them. There is a group of four of these vertical boards for each day of the work week and the four columns of these slots represented loads that were open, that hadn't been covered, loads that were covered, loads that had been dispatched and loads that had picked up. Only four columns. And the reason there were not five? Because when a load delivered we took the card off. The board entered information on it into two different ledger books, one for the customer and how much we were going to bill the customer and one for the carrier and how much we were going to bill the customer and one for the carrier and how much we were going to pay the carrier.
Jeff Silver:They gave me Paul and Noam, gave me a folding card table, a three-button push-button phone and a Rolodex of all the trucking companies they had worked with and told me to start calling the trucking companies trying to find out where they had empty available trucks and match them to the loads on the wall. And I did that. That was my very first day. I was our first carrier person. So if you know today, when people talk about the Chicago way of brokerage or whatever, that was just the way we organize things. And I did that until we hired another guy, john Thompson, who was eventually to go and start American Transport Group and he was our carrier department. After that we hired a bunch of people to work with him and I started selling to customers.
Andrew Silver:So what was Paul's idea for this business? I mean, the industry had been deregulated. Why was Paul doing this?
Jeff Silver:What did he see as the opportunity or did he even realize on his story? You gotta convince him to come on this thing there's no chance, although granted a year.
Andrew Silver:My wife, my wife was giving me shit last night because she's like do you remember when this thing first started? I said you gotta get jeff on and you said there's not a chance in the world. And at at that same time, you had also only ever listened to one podcast and it was about the color blue. So things change. Maybe, I don't know. I did text him, and a few months ago, and his response to me was I've stayed incognito for 42 years. I'll do anything for you, but not this.
Jeff Silver:It was definitely him, I'm definitely, I lean that way, but as you know, I'm a little less incognito than he is. But the whole, the way Paul got into the business actually technically, maybe slightly before it was deregulated enough for him to do this, but I don't think he realized that involved his brother-in-law and a neighbor, one who worked for his brother-in-law, and a neighbor one who worked for his brother-in-law I think was Neil, was working for I'm going to screw this up but a company that was making brake shoes out in the middle of Nebraska that had to come back to Chicago, and his neighbor who worked for a mattress company that had a private fleet that was delivering out into Nebraska and coming back empty. And Paul realized that he could, you know, help everybody and make money doing it. Help everybody and make money doing it. So that's how he started doing it.
Jeff Silver:Now CH Robinson had been in business since 1905, if I'm not mistaken, they'd been around for a long time in doing this. Before the industry was deregulated, you were still allowed to do freight brokerage, but only with what were called exempt commodities, and that includes produce, and so they were forever. That's how they, you know, were born as a, actually as part of a grocery business and eventually became a transportation business for these exempt commodities. But in the early 80s, when things were deregulated, then everything changed.
Andrew Silver:So Robinson had this kind of massive leg up from having built the infrastructure for this produce business that by the time the industry was deregulated it set the stage for them to become the kind of gold standard or the behemoth of the industry that they are today. When Paul started Backhaulers, that first couple years was there a lot of competition or like what were the biggest challenges that you all ran into as you were building the business?
Jeff Silver:Everything was a challenge. Carriers didn't want to work with brokers. Shippers generally didn't want to work with brokers. Things were very, very different. There were two types of two types of equipment, two sizes of equipment. Everything was a 48 footer, 45 or a 48. And there were starting to be some 53 foot trailers. You know there were folks that that worked with Robinson. I think Alan Lund was already in business, he had left, chn was out there and there were a few of those that were shipper agents and things like that. But it the big challenge was convincing somebody that brokerages was was okay, right, and I mean the good news was that, if you, you know we didn't, there weren't this, there wasn't this proliferation of a lot of bad actors at the time because there weren't that many actors, but at the same time, people weren't used to doing this.
Andrew Silver:Yeah, because it feels like when you say you had to convince them to be okay with brokers, it's not like the way that I had to grow up convincing someone to work with a broker, Because when I had to do it there was already years of history and a connotation surrounding brokers that was based on historical performance of many of the brokers in the space. When you had to do it for the first time, it was different, right, and I'm just curious what that was like. If you could kind of help us get into the interaction of you reaching out to shippers, like what were those rejections? What was that like relative to how it is today or how it was in the last 10 years?
Jeff Silver:I think it's way different today. I mean, today, anybody who's a shipper has hundreds or thousands of brokers beating down their door, plus carriers. Right, certainly was not that course. Um, you know, I think we were just too young and and naive to know we shouldn't do it. You know, I I'll so when I I I had to get.
Andrew Silver:What do you mean by shouldn't? To know we shouldn't do it, shouldn't do what?
Jeff Silver:brokers was wasn't going to work right or anything like that. It just, it just seemed there's just. I guess it's as simple as the fact that that was what Paul expected me to be doing was to go find customers. Paul, a lot of Paul's customers were originally, uh, folks that had come from his father's sand and mineral business where he dealt with all these folks that were involved with mining bentonite, clay and silica, sand and calcium carbonate and all these. And you know his relationships originally his father's relationships and then his relationships and then that had been parlayed. You know the way we sold then was get your first load from a customer and immediately call a shipper on that load If that wasn't the customer, call the consignee on that load If that wasn't the customer, and say, hey, we're delivering to you for from this customer. What else do you guys do, tell me about your business and somehow or another. So what paul did when I started working with him after my brief stint on the carrier side, um, was he would give me his scraps right and say why don't you try this guy? He would keep his main customers and and gave me one or two of the less well-developed relationships and says you know, start calling on them.
Jeff Silver:The first sales call I ever went on was up in Saginaw, michigan, at the Central Foundry Division of General Motors. At the Central Foundry Division of General Motors, and whatever suit I had I put it on, flew up to Saginaw and American Eagle or whatever. I was 22. I don't know if I turned 22 yet or not, probably not. I was probably 21. And I went and saw this guy named Lee Neer who was just so perplexed that such a young kid would come up that they actually gave us a contract.
Jeff Silver:We started hauling for General Motors at least this division of them, and that was a customer of mine for a very long time. We were bringing in bentonite clay that was being used to and olivine sand that were being used to line the furnaces in the foundry. So after that, you know, I found, just by accident, I went to a block party, um, and found a customer that uh, well, another Paul, actually another Paul's accounts that that he had had run into. So there was originally another guy involved in in backhaulers guy named Jim Stone, uh, who was from the family that at one point owned Stone Container, which eventually merged with Jefferson Smurfit and Container Corporation of America and all these other companies. But Jim introduced Paul to the paper business as well and so at some point I started taking over some of those paper customers and that became my entire focus for the most part, except for a few types of customers where a few specific customers.
Jeff Silver:So I developed an entire business of paper customers to where I was dealing with converters, of paper customers to where I was dealing with converters. I eight of my customers were were exact replicas, or Dunder Mifflin from the office is an exact. I've been in that building, not exactly not the same one, for sure, but the same people. Those are folks I dealt with all the time, from a bunch of different and a bunch of them were based in in Eastern Pennsylvania, where Dunder Mifflin is based on the office, but paper mills as well.
Jeff Silver:I used to go to paper week in New company a prospect about paper rather than freight Right and what the industry was doing and how the market looked and the market for OCC and what diameter and basis weight paper they were making, and just got to to know everything about it. And we had um, you don't know, I'm had focused in metals uh, gary Bazelon, I think, plastics maybe. So we did our own thing and that was our focus and that was the way we organized that part of the business, right To where, if it was a paper customer I was calling on, if it was metal it was non. And then on the carrier side, we just automatically were starting to work by backhaul right, and so many others did it a different way, where they would, you know, work where you know, in these small mole hills, which we never thought was going to be very efficient. It would never work. Obviously, we had no idea.
Jeff Silver:If you look at TQL's business, which is mostly still built that way, it's incredibly successful, although they are, I think, centralizing some of their carrier stuff. But we organized very naturally, very differently. One of the things about us, these young kids that were doing this at the time, is we spent no time worrying about what anybody else was doing. We never spent any time worrying about CH. We didn't look at other people, competitors, that were coming up. We just focused on what we thought was the right thing to do. You.
Andrew Silver:Thank you. Would it have even been possible to to know what others were doing at that time in the late 80s? Could you know what someone else was doing? I mean, I'm trying to just put myself into that environment mentally, and and I'm trying to visualize all of this, which, by the way, speaking of visualizations like how much hair did you have?
Andrew Silver:at this point of hair afros at that point, but I had hockey hair. Afro was gone, but you had hockey hair. Okay, I was just imagining you going into this saginaw facility as a 21 yearold with a suit on and, uh, I was a non-hockey playing running the business got it, um, okay, so so I get the.
Andrew Silver:You know, you guys were just focused on what you were trying to build and had started to develop the Chicago way, wherein the carrier team was generally focused on back halls regionally developing yeah, and remember is that at least very early on, our focus really was on private fleets.
Jeff Silver:That was the idea. American backhaulers it was loading private fleets on their backhauls. Many of those fleets don't exist anymore. So Carnation Company had Carnico Transport. I mean there were the Singer business Singer makes sewing machines and made some other stuff at the time, but they had a private fleet and every time we could we would load these private fleets.
Jeff Silver:Culligan had a private fleet and that was what we. We tried to do that anytime we could. But we also started working with just about any fleet as well. But the idea was we just made all the sense in the world that we would have a group of folks that were based, that were focused on, let's say, the, the carolinas, right, and so they would automatically work with all the carriers that were trying to get back to the carolinas and all the freight that was going to the carolinas. So whenever they had a carrier on the phone, if that guy had a truck in chicago or or washington state or washington missouri, it in Chicago or Washington State or Washington Missouri, it wouldn't matter, the guy was trying to go back to the Carolinas. So that carrier rep that was dealing with that Carolina carrier would be able to offer them all the loads without restriction. They didn't have their own loads that they were trying to push or sell over the benefit to the company like a lot of the other method do.
Andrew Silver:Yeah, and I mean that's always been a cornerstone of, well, I guess, backcars and certainly Coyote in your business and your mindset of what great brokerage looks like is structuring the business in a way that optimizes itself with how you pay people, how you incentivize them in terms of their responsibilities and putting them in a position to want to make decisions that optimize the business or make the business run as efficiently as possible. But you have seen, obviously, your credit comments to TQL's model. There's clearly another way that has the potential for significant success.
Jeff Silver:Yeah, I mean there's good and bad to both. Significant success, I mean it's there's. There's good and bad to both. Um, there haven't been too many that have scaled the other way, the way tql has, the non-chicago way, whatever that's called.
Andrew Silver:so yeah, cradle of grace, talk to me about the culture like define, define the american backhaulers culture for me gotta look at it in two phases.
Jeff Silver:Phase one we definitely had fun. Uh, back then we hired people that we knew, or somebody knew somebody or or whatever somebody could walk and maybe chew gum at the same time. We would hire them. We didn't know what we were doing and so I would say it was maybe a culture of people, some of whom were trying to do things by emulation and seeing what we were doing and trying to sort of do the same thing. But it was not a deliberate thing, I don't you know. We're like we sort of were stupidly thinking we could take anybody and make them successful, right it just you know what we were doing. So that that phase sort of ended in in 91 when we hired marianne who came in I think we had about 80 people at the time uh, she weeded out about half of those and then brought.
Jeff Silver:You know, she very naturally decided that she was gonna change the way we hired and really for the whole industry today and the way it recruits, invented this idea of going and recruiting at great colleges Nobody really did that before and along with it, creating a culture that would be attractive to those people. So her idea was to try to, in a way make the industry less important. Meaning this trucking thing, people were at the time just starting to call it logistics. Nobody was really calling it supply chain anything. Then she didn't believe she could go sell freight to college kids. But she could sell a great culture right. And so I was listening to I forget the guy's name another one of your podcasts about the guy that had started at Calvary and he was attracted to it because they drank beer on Fridays. Well, we did that. I'm not sure if it was ever very smart or not, but it was part of what we did and a very natural thing and part of what sold and brought kids from college campuses to want to come and work for us.
Jeff Silver:So when she first went out and started recruiting, she was also very young. She shows up at Indiana. She figures you know, I'm going to go recruit at Big Ten schools, big dense schools, and Indiana university basically laughed at her and said you're never going to hire kids here, cause she was going up against the big accounting firms, the PNGs and those folks you know, cause IU is not that far from Cincinnati and RJR or Altria or whatever where college grads would go out and sell cigarettes and all those things as part of a territory, and she was successful. And two or three years later we were the largest recruiter at Indiana and she did the same thing in Michigan State and with that came a drastic change to the culture and one that was really based on making it a deliberate culture in the first place.
Jeff Silver:Right, this idea of work hard and play hard and frankly I think very often the work hard part was what everybody looked at. I'm sorry, the play hard part was what people looked at as opposed to the the work hard. You know, and you know not really the folks that we would hire. They got it because so many of them came from a reference that was already working for us, from the same fraternity, from the same sports team. But people will look at us and see there's ping pong tables and, yeah, there's beer Fridays and there's this and that and the other, and not realize how hard it is of a job and how much you really have to work. But for the right folks, it to work like that, that want to work in that environment, is sort of a self-propagating thing for the type of culture that allowed us to be super successful.
Andrew Silver:When did you notice that the business was taking off, that this was really going to be something, that you couldn't just be the naive running around we can make anyone successful. There's got to be a point where you're like, holy cow, this is a real business.
Jeff Silver:It happened. We made a lot of money, I made a lot of money, a lot of us made a lot of money. But we never thought about it that way, really, or at least I don't remember, none of us had MBAs. We eventually hired a CFO kind of guy that had an MBA, but we thought it was silly, there was no, what do we need an MBA for? That was not a thing, right, I mean. We, we just did things that seem natural, like the idea of creating our own technology. There was no other choice for that, for sure, there was nothing you could buy that was worth anything. No other choice for that for sure, there was nothing you could buy that was worth anything.
Andrew Silver:Uh, yeah, that that was where I was. That was what I wanted to ask, because there had to be a point where you're looking around and saying, like these punch cards, we have 80 employees, 100 employees. Like, how many freaking punch cards can we have?
Jeff Silver:so that we need to change that started very early and you know, I actually I think it was the it was the very first summer after I'm sitting there every day calling the same. You know, even in that first week, as I sit there with that um rolodex of carriers and a yellow pad of paper where I'm writing down, I remember one of my first carriers I was calling was Beeline Motor Freight, based in Omaha, nebraska. Eventually became Cornhusker Motor Freight, but I would call Beeline, talk to a guy named Paul Turley every day and say where do you got trucks today? And he said well, I've got guys in Chicago and Atlanta or whatever, new Jersey and wherever, and which of these guys need to get back to Nebraska and which ones do you want in Hartwell, georgia, because there was, I think, a Monroe shock absorber plant these guys did business with and they had to get trucks there, and one in Paragoulder, jonesboro, arkansas as as well. So that's where their big customers were based. And so the very first day I'm riding b-line motor freight, writing out the whole thing, and chicago, illinois, going to paragold, arkansas, and I'm writing this down in the size trailer and it's a van right, and you know, by like the second day and the third day I'm starting to, I'm starting to abbreviate stuff right, and eventually I'm abbreviating more and more and more. And then I started using codes for the cities, basically or three digit, you know. And I started using codes for the cities, basically or three digits, you know, the first three letters of the city and then the state and I've got the. Now it's a V48 instead of 48 band and all this kind of stuff.
Jeff Silver:And actually that first summer I convinced Paul that we need to go buy a computer and went and bought was a Capro. It was one of the first portable computers. It weighed about 25 pounds. It had a keyboard that folded down from the front that was attached to the computer with this big curly cord and it had a handle on the back so it would attach to this big computer so you could take it home. It was portable.
Jeff Silver:And at night I wrote our first load matching algorithm. Basically that provided a very easy, quick way to enter the capacity hour. It would spit out a green bar report for those that know what that is that would show by date, by origin state, by destination state, all the trucks that we had put in there, so that whenever a new load came in, we could go look at that report, find the trucks there, call those carriers, see if they still had the trucks. Okay, and so the tech was always important between Noam and I. We were always both sort of involved in that, at least until Noam left which was pretty early, but I don't remember exactly what year that was and then we had hired this guy, eric Harrison, whom you know, and he helped us create this system that was called Express. That became a huge part of our success in that and actually a big part of why CH bought us and is actually still involved in behind the scenes in a lot of what happens at CH today.
Andrew Silver:So that was kind of your first foray into TMS.
Jeff Silver:Yeah, but there were a few of them over the course of time at Backhaulers. I mean we always had something. We always had a computer system after that very first start.
Andrew Silver:And you just kind of expressed, you just kind of kept building and iterating on to make better and better over time.
Jeff Silver:No we actually, uh, had a failed start, something we had called, I think, falcon or something like that, and then scrap it. And then we wrote express, and I don't remember the year we started trying to write that, but you know, the tech was involved was evolving quickly. Uh, you know, there was a point at which, I think, eric and I went and looked at trying to write the whole thing in Java and decided to stick with Microsoft instead. I'd always kept my sort of programming certifications up to speed, not that I was actually doing it, but I always wanted to know what the tools were that were involved. And so, you know, it was definitely always critical to what we did, and that's in an industry that was not doing the same thing.
Andrew Silver:What do you think are the key elements from the back hauler days that are still just very true in what makes great brokerage? What are the parts of back haulers that?
Jeff Silver:you think live on in so many of the companies that have been started now as a result of people who once worked for you and Paul 40 years ago. I mean, the by far the most important thing is is the people that we hired and and and who became successful as part of that and everything that they've done since then. But it's, it's some of it is the sort of method of moving freight. You know, we did treat carriers like gold always. That was always critical, right? I mean, we always in our commission structures paid our carrier reps at least as much as our customer reps, right, we always made sure that the carrier was at least as important as the customer. Some we talked about all the time. That was very different from a lot of what a lot of people you know do in the industry. Who would you know, abuse a carrier just on a daily basis for for profit reasons or some other stupid idea. So I think that was that was a big part of it.
Andrew Silver:What about Paul? What made Paul so unique or great?
Jeff Silver:at what he did. Oh, he's a great guy he's. He's a great relationship person.
Andrew Silver:Um, he has the Midas touch Everything he touches turns to gold you and when you think about yourself in those years age to 37, I think is when you the company sold, you were 37. What did your leadership style look like back then, when you actually got into running the business? What kind of what kind of leader were you?
Jeff Silver:is. So I did communicate a lot. I wrote the truck stops here all the time, uh, something that we what's that was a newsletter, uh, that we sent out every week. Um, I I read a couple books over the course of my time at Backhaulers that had a huge impact on me. One was this hugely cheesy Zig Ziglar book on sales.
Jeff Silver:Up until I read that book I was still sort of saddled with that idea. I'd gotten growing up that sales is a dirty word. You know, the one time a year we were allowed to go buy new shoes, we always had to be careful that that salesman wasn't going to talk us into buying two pairs instead of one kind of thing. Right, because those sales people are. It was a bad word, or it was a bad word. And so I remember I had gone to Sylacauga, alabama, to visit a customer and I had to get back home and there was a line of thunderstorms coming across going east that was aiming at Alabama, and the only chance I had to get home was to jump on a flight to Atlanta and then connect there, as opposed to waiting for the Birmingham to Chicago. That was later that night.
Jeff Silver:And so I go to Atlanta and I'm sitting in Hartsfield for hours looking for something to do, and I go into this bookstore and I buy this book by Zig Ziglar called the Art of the Sale or Art of Selling or something I forgot what it was called, and, for whatever reason, that absolutely cheesy book made sense about.
Jeff Silver:If you're going to do it, figure out how to fall in love with it, and if you're not going to fall in love with it, don't do it. You've got to treat sales as this is something I'm going to be better than everybody else at, and that changed the way I thought about sales ever since then. As long as you're selling a product that you believe in and you know that you should be able to convince people that it's going to help them, and you have to realize that maybe they haven't heard you yet, maybe there's something that's blocking your ability to sell to them right now because they don't get it yet. Once they do get it, they will buy from you. They will buy what you're selling, right? So that was a transformative moment for me, having read that book. As cheesy as it was, another book that I read was Wait wait.
Andrew Silver:What other elements whether coming from the book or just now, your experience do you realize make a great salesperson?
Jeff Silver:curiosity for sure. I remember hearing one of your guests talk about that on your podcast. Somebody didn't forget it might have been piet, I think. Uh talk about that and that's very, very true.
Jeff Silver:You know, one of the things that that I learned it's boring, actually now that I remember it was boring talking about that um, one of the things that that you realize is that and we used to teach all of our trainees this immediately when they came in a training class, atote but the most powerful thing that you can do in selling is shut up and listen. Customers don't want to hear you talk. They want to talk. They want you to hear them. And if you can learn how to shut up, you've got half the battle won already. Not everybody can learn how to show up. You've got half the battle won already. Not everybody can learn how to show up. That's a very critical thing. That includes learning how to ask for the sale and then shutting up and not trying to talk yourself out of it. Silence, quiet, is very uncomfortable for people. That's why some people just never shut up. See, it gets uncomfortable, and so learning to do that is very, very critical. But most mostly, you know the whole thing about having two ears and one mouth and letting the two ears do the do the work in the mouth, not right, uh? But I think that that curiosity really learning about what makes a paper company work and and that is, I think, the coolest thing about what we're doing now at mastery, where I get to spend my time with the ceos of these trucking companies, where every bit of that has been a learning process. Yeah, I know all the customers. A lot of the customers they have were our customers before.
Jeff Silver:Trucking companies where every bit of that has been a learning process. Yeah, I know all the customers. A lot of the customers they have were our customers before and I know those. I'd never gotten to really interact with professional truck drivers before and really get to know what they care about or what it's like to run a trucking company. I mean, I've learned a tremendous amount from the CEOs of these businesses and every one of them is different, right From Warner to Schneider to Prime, to Averitt and Covenant.
Jeff Silver:Every one of these the Canadians that we have CAT, canadian American Trucking and B bison every one of these companies is different. They run completely differently, they care about different things and that is, for me, has made this in some ways, even cooler than the other things before, because we're not. You know when you're, when you are selling freight, you're trying to get a customer to give you business right and they're going to protect themselves a bit and they're going to share certain things and not certain things, and we had great customer relationships. This is a whole different story. Once somebody has bought our TMS and it is being embedded in their business and becomes crucially important, the conversations that we have with them now are way different. You know they're doing well depends on our really helping them as much as possible At least, that's what we're trying to do, and really understanding their business is absolutely necessary in order to do that, right At the scale that we're talking about.
Andrew Silver:Well, especially because, in a lot of cases, as pertains to technology, you know, the statement made by every VC that's invested in this space is and it's been made by everybody else too is that the trucking industry has always been so far behind on technology, and in a lot of ways, that is definitely true.
Jeff Silver:And so the relationship, the intimacy. Let me stop you because there's a really important distinction here. Go ahead. That is 100% true on the trucking industry. It is not true on the freight brokerage industry.
Andrew Silver:I agree that's a good distinction. Granted, I said trucking for a reason. So we were going to get to the brokerage element and Coyote. We're not there yet. We've got a long way to go. But the comment I wanted to make was we got a long way to go.
Andrew Silver:But the comment I wanted to make was it's really interesting to think about the notion of you selling into the Schneiders and Werners as a TMS provider versus selling to Coca-Cola and Pepsi as a brokerage provider. Because, as you said, in the latter example the shipper is there's stuff that needs to stay close to the vest and there's stuff that there's risk involved. They don't want to let you see everything. In this environment where you're selling TMS and you're becoming the nucleus of the technology that kind of how they operate their business you need to know everything and in a world where a lot of these companies have never had great technology, they don't necessarily know what to even ask for or what they could have. So it's not like they necessarily have all the answers. Part of your job is to get in and understand their business so deeply that you can put answers in front of them that they didn't even know necessarily what the questions they were going to ask are. Does that?
Jeff Silver:make sense? It does, and especially with the very large trucking companies. Most of the very large trucking companies have been running on mainframe for a very long time.
Andrew Silver:Will you define very large in your mind capacity, like how many trucks you think? What does that?
Jeff Silver:mean five hundred thousands, I mean a lot of the 500s are as well, but you know, the most of the large trucking companies and the railroads have run on mainframe technology for a long time.
Jeff Silver:You, there was one dominant and still is one dominant program that is being run by the largest not everyone, but most of the largest trucking companies in North America.
Jeff Silver:It was called ICC, innovative Computing something another company maybe and was built to run on the AS400, the IBM platform platform, the ibmi and I actually had the, the good fortune of being able to have a dinner with shelly simpson from, uh, from jb hunt. Jb hunt who told me the story about when JB himself was just super proud about being the first company up on that in 1973, written in COBOL, and in many ways that is what is still running many of the largest trucking companies, or at least has been until we've come along, because there has not been a good choice. So you had a few like Schneider. Schneider, under Chris Lofgren's leadership, got off of the mainframe a generation ago and they did it by taking Oracle's OTM, which was not meant for a trucking company, more for a shipper, and bent it and broke it and wrote millions of lines of code around it to make it work for a trucking company.
Andrew Silver:What's the problem with being on the mainframe and that? How does that hinder their ability to run their business now in today's environment?
Jeff Silver:Well, I guess there are two things. Number one is I mean, this is what you're talking about is now 50, 60 year old technology. It is doable, but it is very hard to connect with other systems. There are software that allows you to do it. In fact, with most of these big trucking companies we've integrated via API with their mainframes, using typically MuleSoft or something to do that. It's not a natural thing to do because obviously API didn't exist at the time the stuff was written right.
Jeff Silver:So a couple of big problems with it. Number one is it's not supported, and you know, almost all of these guys that are running it have had groups of folks, their own programmers, that have done all sorts of stuff with it and changed it so many times. Every time new leadership would come around in the company or they'd get a new customer that needed this or that or whatever that they're not supported in any way by outside companies. Number two this was a great, great comment by a guy who's not a customer of ours who said I just cannot continue to go to, you know, to rest homes to try to find programmers for COBOL because nobody's making new ones anymore. Right, nobody's going to school to learn COBOL now.
Andrew Silver:Young programmers are not learning how to support that technology. Basically.
Jeff Silver:But there has not been another system built for these large companies until we've come along, which I had no idea of. Frankly, when we started Mastery, the idea was not to go do that, it was to support you at Molo.
Andrew Silver:In the very first place, I did not realize what a giant hole there was in the marketplace yeah, all right, I'm going to take us back, because if we go down this we're jumping around here and I don't want to get into we got. We got to get to the world of coyote before we get to the world of mastery, so we're going to try to go linearly. Um, let's wrap up on back haulers. The company was acquired in 99. What was? What was that experience like? Were you guys looking to sell the company? Or robinson just came in and said, hey, I'm buying this thing? Like take me back to that. And what that conversation looked like between you and Paul and the thought.
Jeff Silver:Yeah, a couple of things. You know the we definitely were not out looking to sell the business. At one point I answered a call from a guy named Steve YB, who was at at CH at the time, reached out to see if if we'd have any interest in selling, and had he called at a different time? Maybe I don't answer the phone, maybe nobody does, maybe Paul picks it up and hangs it up. I don't have any idea. I happen to answer it.
Jeff Silver:You know, we had just at the time, not too long before that, unfortunately, there had been an accident with two of Marianne's recruiters were killed in a car accident that while they were out recruiting, and that really was a gut punch that took some of the fun out of everything that we had done at Backhaulers and the whole experience. I'm not sure, had that not happened, that we had been ready to sell at that point, but that was part of it. Part of it. Um, you know, I don't know what else, but these guys, they, you know this guy, steve, called and I'm not getting into the numbers, but I basically I turned to Paul and said, how much money do you want for the business? And he gave me a number and I said, well, if I can sell it more for more than that, can I keep the rest? And he said, sure, and so I flew up to uh eden prairie and met with them, showed them our technology.
Jeff Silver:They had been down the path of trying to build their own new system.
Jeff Silver:What they had at the time was much more of a way of sort of recording loads that had already happened In fact they called loads files at the time, loads that had already happened as opposed to a way of moving freight and actually there are still a bunch of systems that do that.
Jeff Silver:There was no way really at all of very quickly entering a truck, entering a truck in their new thing they were trying to develop, which in a funny way was actually called Silver Bullet. That they thought was going to be their silver bullet for all their technology needs. I wasn't stud but, um, so this thing you would have to to put a truck in or record a truck, which they a didn't really want to do. But if they did, you had to click on the origin state and then put in a city and then click on the destination state on a map and put in or something like that. It was like four or five screens long just to put a truck in. And even back then you could put a truck in and express in four or five clicks if you knew the code for the city and you had set the defaults up for the truck or whatever. And so they saw that technology, they let their head of technology go, I think maybe the next day, and we ended up doing a deal with them.
Andrew Silver:So I remember when Coyote was acquired and I remember being with you and Mare when that happened, and I also remember selling Molo and the mental anguish I went through and what I saw you guys go through when contemplating having an employee base that you deeply care about. That you've had all this fun with and built incredible relationships in this journey you've been on together. And then selling it and putting it in the hands of someone who you, you know, kind of don't know from adam. To an extent, you've spent time with them figuring it out. What was that piece like for you and was that a big deal? Was that something you were worried about culturally, or were you worried about your people and what could happen to them by becoming part of, you know, this much bigger company?
Jeff Silver:talk to me about that I think I was way too naive the first time. I did not know what that would feel like. You know, obviously, the second time, and you know very, very different scenario, I think that it's always hard and um, in retrospect. In retrospect, there are many folks that were at back haulers that have had phenomenal careers at at Robinson and some of whom are, are, are some of, who are very high up in the company today and and you know, jordan cats for cash, for example, who runs TMC. You know it's a huge part of their business. These folks have had great careers. Some of those folks Pat Nolan and those kind of guys it's been the best thing that's ever happened to them.
Jeff Silver:Marianne, I don't think lasted a month. She was not happy with their HR folks. They were completely different, different kind of people. They didn't hire the same way. They adopted a lot of what she did eventually, but she was out of there quickly. She was not happy about it.
Jeff Silver:You know, I thought maybe I ended up being the CEO of of Robinson If I stayed around and tried to adopt the, the CH people myself and thought maybe I could be, you know what could transform them. And certainly the acquisition transformed them. I don't think I did, because I didn't last that long either. I lasted a year. But you know I think CH generally did a phenomenal job at preserving the culture. You know Chicago Central was Chicago Central it probably still is really, I think, in a lot of ways as people talk about it and it was that way for a very long time. And frankly, I also think UPS did a great job of leaving Coyote alone for a very long time and you know Marianne stayed around for three years or so.
Jeff Silver:After we sold UPS I switched to the UPS side immediately. So I was out of it and you know we had somebody that was part of our our team won't mention who it is, but really wanted to bring a lot more of the managed by EBITDA thing into the, into the, into the business. That I think, hurt it and otherwise UPS said it would have stayed out of it even a little bit more and let it. Let it flourish the way it had before. But you know Jonathan was able to run that thing well for a for a long time with with some good people helping them and and you know it did really well and hopefully it will again now that they have got drew running, the running, the whole thing as part of RxL. He seems absolutely great.
Andrew Silver:Yeah, and I didn't mean to suggest any negativity there, more so, just the idea that you're taking your baby, something that you've poured yourself into and all these people you've poured yourself into, and putting it in the hands of someone else, and I was trying to understand the mindset that was like for you the first time around.
Jeff Silver:I guess I didn't think of it that way and it's probably stupid, right, but I really thought that I would stay with these companies that bought them and they'd still be working for me in a way.
Andrew Silver:Honestly, yeah, these companies that bought them and they'd still be working for me in a way, honestly. Yeah, that's reasonable because I had the same thoughts through my own acquisition experience two years ago. But we don't need to go there. I'm curious. And Paul, he was selling and then he was done.
Jeff Silver:No, he stayed around for a while. He was pretty frustrated, was selling and then he was done.
Andrew Silver:No, he stayed around for a while he was pretty frustrated, honestly, uh, and then he left. I mean, I think it's reasonable to say that the back haulers acquisition by robinson could could be. You know, if you were to list the most successful acquisitions in our industry's history, that's got to be one of them, for sure I mean it really.
Jeff Silver:If you think about it, we were. I think we were around 300 million in sales when we sold the ch they were 2.7 billion. When we started coyote in 06, ch was 8 billion six years later they had gone from three to eight in that time, partially, though.
Jeff Silver:Echo was around by then and TQL was doing well. They did not have a real scale of the competitor going hard at them Because, you know, they embraced the tech, they embraced the folks and it did really well. They embraced the folks and it did really well. They also made another good acquisition with what do you call it? Stefan Rambo's business, phoenix International, and they had done some others as well, but that also was pretty transformative for them. Those were the two acquisitions that they did. That had a huge impact.
Andrew Silver:So 25 years removed from that sale and 25 to 40 years removed from that experience of what you and Paul did, together with all those amazing people, you know, when I went to, when I worked at Coyote, I never. I was a sales guy, I did a number of roles but I never got to go to a conference because there were tons of salespeople and I just wasn't at the level that I would be going to any of the conferences. Because there were tons of salespeople and I just wasn't at the level that I would be going to any of the conferences. And I feel like when I went, when I, when I got to Molo, the first conference I went to was a blue Jays conference, blue J, the, which is now E2 open. It was called sore down in Florida, and I remember I was there with Vogue rich and that was the first time I had kind of been exposed to the outside world of brokerage, outside of the kind of cocoon of Coyote, and it was also kind of the first time I had really been exposed, like in depth, to your influence on the brokerage world.
Andrew Silver:As I walked around that conference, the number of people who came up to me were like wait a second, you're jeff silver's kid. I I owe my career to him. I owe my career to him and paul, and I wouldn't be where I am today if it weren't for what they did for me and what we did together and the doors they opened for me. It's and and you know anyone who's ever tried to do like a historical tree of the roots of this industry. Everything kind of in brokerage leads back to the business you, paul and your team built together. What is it like to have had such a profound impact on so many people and to have created so much opportunity Like? When you look back on that now, what does that feel like?
Jeff Silver:this makes me feel old, frankly, I mean it, um. First of all, I think there's way too many conferences and people spend way too much time at these conferences just talking to each other and not helping their businesses very much. Um, but it's a deflection, what?
Jeff Silver:no, I'm gonna answer the question I said that's a deflection I just wanted to I think there are some folks that that they just spend a tremendous amount of time doing that and it's too much, and it's too much effort and wasted money. But, uh, because we just don't need that many conferences. Some of them are good though, um. But you know, as I had an experience doing that not all that long ago at food shippers or somewhere wherever I was, and I had umpteen people, first of all, all you know, a bunch of old back haulers and old coyote or former coyote people or people that are still there coming up, but then also people I didn't know at all coming and saying I wouldn't be in this industry without you. And it's embarrassing, for one thing, but it's also cool that I've been able to To have that impact, or that Paul and I were able to, and some other folks for sure.
Jeff Silver:Um. But you know, when I first went to a conference I think it was the tia, which at the time was called the tbca, the transportation brokers conference of america it wasn't even the tia yet, and I was by far the youngest kid there I there were some old truckers that were there, there were guys that had started little brokerages or whatever. That were the big shots, and it's just amazing how fast, all of a sudden, I'm the oldest guy there. It's just crazy. That's mostly what it makes me feel like.
Andrew Silver:All right, I'll accept that answer. That's it. Yeah, so you get kicked out of robinson. I didn't get kicked out, I was given the choice.
Jeff Silver:Well, I gave. I gave john lee off the choice that either this person who was involved in it went or I went, and he said see you later. So it was my choice, I did. That was stupid.
Andrew Silver:Sorry, you didn't get kicked out. You gave the CEO an ultimatum and he chose the option that resulted in your departure. Sorry, I will rephrase that. What next?
Jeff Silver:Well, I never thought I'd be back in the industry again. You know, I had agreed to a five-year non-compete which, regardless of whether it was legal, once I signed something I was never going to go back on it. You know, the two littlest Silvers were born in O O and O two.
Jeff Silver:And shout out Brian and Johnny, this the sixth and seventh of the children and for the audience that didn't know that, so it was great to be able to spend time at home and coach you in football, and you know to the extent I was able to help do that. Being in another business was the last thing on my mind at that point. You know, we were tired, we had made a fair amount of money, we went on vacation to Jamaica and all over the place, turkeys and cookies, as Lexi used to call Turks and Caicos all over the place and I wasn't too worried about it. But eventually I started getting a little antsy and wanted to go back to school.
Jeff Silver:My grades weren't all that great but I thought maybe I could get into this, this, you know this executive MBA program back in Michigan, and I applied to it and got in. So I started that program and my whole idea at the time was I would try this MBA thing because it didn't seem that hard and if I liked it then maybe I'd go get a PhD and teach, which absolutely makes no sense at all in retrospect, but because that's not what you would do with an MBA anyway. But I decided to do that. And then they let me in. It was Michigan, so I was gone. I wanted to go.
Andrew Silver:So what were you thinking about wanting to teach? I had no idea.
Jeff Silver:Okay, just work with students. So you know, and having scoffed at mbas the whole time, it was it was a weird and different idea and this was a. This was an executive mba program, um, but very different from what there are today. Because you know there were no, there was no, there was no Zoom, there was no Teams, none of that existed right. And so basically, so basically the you know there were two weeks in the beginning in August, and then one week a month on campus, and then everything else was basically CDs or DVDs, I guess, cds at the time that you had to listen to.
Jeff Silver:And you know some of the classes I thought were great and some I thought were absolutely silly. Like we had this marketing class where you had to figure out. You know, there's a big game because it's Ann Arbor, there's a lot of automotive, and so you had to figure out, if you spent this much on marketing, people would buy this car. I'm thinking they're not going to buy the car just because you're paying for ads on TV. Make the car better and they'll buy the car. It still makes sense to me. Some of that I didn't really love. I got through the finance and accounting things which eventually ended up being super helpful. Ended up being super helpful.
Jeff Silver:Um, and then the first class of my second term was an operations management class it was. It was taught by a professor named Isaac Duenas, uh, who is Turkish born industrial engineer guy, and the very first day of class he throws this problem on the board and said imagine I forget exactly, but it's something like imagine you're a widget maker, cause everything is widgets in in business school. You're a widget maker in Charlotte, north Carolina or somewhere I forget where, and you have a hundred loads that you need to ship out every day. School You're a widget maker in Charlotte, north Carolina or somewhere I forget where, and you have 100 loads that you need to ship out every day and you have five different carriers that you can use that each has capacity constraints and a number of trucks that they can use and different rates to different states. How do you decide which loads to give to which characters? And I'm like what Said straight up. I'm listening, because one of the last things that we did towards the end of Coyote's existence was we created what became Robinson's TMC and we had folks on site to start with at Campbell Soup and at Willamette Industries, a paper company that doesn't exist anymore and we were supposedly optimizing tendering loads out to other carriers and we would broker some of the loads ourselves, but otherwise we were tendering these loads out. Well, technically, in a time in which there is unlimited capacity, the optimal answer is to give the loads to the cheapest carrier, right, as long as they're giving you good service. Where there's no constraints, it's very easy. When there's constrained capacity, it becomes a different question, right. Then you got to figure out the whole puzzle, and so professor duanious takes um, takes out excel, launches excel, launches the, the solver inside of excel, sets up the problem and solves the thing in five minutes or whatever I.
Jeff Silver:I was like, holy shit, this is the coolest thing I've ever seen, and so I decided I wanted to find out much more about that. So I actually, between the two years of my MBA, I wanted to see if I could go learn more about the specific thing. So I found this program out at MIT, called the Masters of Engineering in Logistics, or MLOG. It is now called something else, it's a Master of Supply Chain. But I was like, first of all, there's no chance I'm getting into MIT at all because my grades weren't that good in college in the first place. There's no way they're going to let me in. But the program looked really cool and so I called the program.
Jeff Silver:And I called and ended up speaking to the director of the program and I said you know, I'm interested in this MLOG thing program. And I said you know, I'm interested in this MLOG thing. I don't think I have the grades to get into it, but I've been in the freight business, for I had this freight brokerage and I've been in the business for, you know, 17 years. Blah, blah, blah.
Jeff Silver:And he says wait, who is this? And I tell him my name and he said, oh, you can come. And I said what are you talking about? And he said, well, you'll have to get a 700 on the GMAT or the GRE, either one, and then you can come here. I said why? And he said well, you know, I used to be at Ohio State and I'm like, oh great, that's not going to be good. But I used to teach a class about American backhaulers. I know exactly who you are, I'd love to have you here.
Jeff Silver:So I was lucky enough, because of that, to be able to go there and it was one of the best experiences I've ever had in my life.
Jeff Silver:There's so many smart people there I was definitely the least smart of all of them. The good news was that I had sold a business so I could afford to buy pizza and beer for the folks that were a lot smarter that I made sure I was in a group with to to get that work done. Uh, some of them are still floating around the industry because they came and worked with us at coyote specifically, uh, chris pickett, uh, and bill grieger, who's been on this program, uh, so, uh, phenomenal experience and the best you know, the best thing career-wise out of it besides getting to know those people was was really understanding what all the problems are that you can solve with optimization in this space. And, as you know, that's a huge part of of what we're able to do at at mastery, where, where our TMS mastermind actually has embedded real optimization that makes sense to help anybody do anything from putting a bunch of partials together to make milk runs to assigning the right driver to the right load.
Andrew Silver:So at this point you'd been sitting out. Your non-compete and curiosity had taken you down the education path with the MBA at Michigan, which then you saw freight applications which brought you to MIT.
Jeff Silver:So then I went back and finished my MBA the next year at Michigan and then decided I wanted to go get that PhD. So I got into the industrial engineering PhD program at Northwestern and was into the second trimester of that and at one point Marianne said no, mas, I'm not having any more kids and you're not getting any more degrees, you're done. And then we started Coyote.
Andrew Silver:What was the impetus for that decision by Mer? What was the impetus for that decision by Mer? I think she just had it. I don't know. You have to ask her Around school, though you just was. So I'm curious how you stayed the path of wanting to be a teacher, given like there weren't business ideas generating, as you were at mit, meeting the driegerts and pickets of the world first of all, drieger was a kid.
Jeff Silver:he was 27 years old and it was a I mean I don't think he was even that at that point. He was young. But there were. I mean, I still had a year on my non-compete, I think, at that point, and you know I wasn't convinced that I wanted to go be a broker again at all.
Andrew Silver:Well, talk to me about the genesis of Coyote. Where did the idea come from? What was the idea too?
Jeff Silver:Well, in the very beginning the idea was to build another company, but we were just going to be an ATMS business then. Probably right, we did not know that we were going to be a brokerage. So we started off with this idea of writing a new brokerage system, actually sort of sold it to two different companies. And then I had heard from one of those, or a couple of those folks from Robinson's office in Normandy and they were starting a business over there and they needed technology. So I agreed to make this, to make that a system that they would be able to use in Europe as well, uh, with with coyotes, you know, with our, our, our TMS, that we were going to write. So I went over there and visited them and we hired uh, we had hired a couple of developers that we started with, uh at Coyote. I'd go and visit them. Then I went with them to go see a customer once, uh over in France. And then it went again and I think the third time I went uh to visit them and I was with customers and they were getting their offices set up and I was, you know, figuring out because we were, I think, severely underpricing the software that we were selling at the time, thinking about what the business would be worth versus another brokerage.
Jeff Silver:And on my way home from Paris that third time I decided that I didn't want to be a technology company where you just and I didn't know what I was doing, but where you just sell the software once and never deal with the customer again. I thought that's how it worked. Obviously I have learned very differently this time, but I was really. I thought that I would not have that same interaction, long-term interaction with customers that I had in a brokerage and I thought the long-term financial results wouldn't be as good, so pivoted very quickly. I was lucky to hear from Paul that Mark Ford was available. He'd been a carrier guy at Backhaulers and he was available and looking for something to do and we were able to hire him to be our carrier department to start with and build it and we were off and running with the priority.
