The Freight Pod

Ep. #67: Clay Curran, CEO & Cofounder, FreshX

• Andrew Silver • Episode 67

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Andrew welcomes Clay Curran, CEO and cofounder of FreshX, a young company tackling the tricky reefer LTL space. Clay shares his entrepreneurial journey, marked by a willingness to pivot that has shaped both his personal career trajectory and the FreshX business model. Today, FreshX is a marketplace that connects brokers with more than 80 reefer LTL carriers.

In this episode, Clay also covers:

  • His path to entrepreneurship and early lessons learned from his entrepreneurial parents.
  • The evolution of FreshX, including two major pivots from a last-mile delivery carrier to a reefer LTL brokerage, and finally to its current iteration as a tech-driven marketplace.
  • The challenges and nuances of the reefer LTL market, including carrier specialization, capacity visibility, and the difficulties brokers face in sourcing reliable options.
  • How FreshX is working to unlock hidden capacity and digitize pricing by building relationships with more than 80 reefer LTL carriers and providing a "Google Flights-like" platform for brokers.
  • His advice for aspiring entrepreneurs in the freight industry, emphasizing the importance of good advisors, rapid iteration, and deeply understanding the real problems you're trying to solve.

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. ***
Andrew Silver:

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, all right.

Andrew Silver:

Ladies and gentlemen, welcome back to another episode of the Freight Pod. I'm your host, andrew Silver, joined today by another special guest. They're all special guests on the Freight Pod. Today's guest is Mr Clay. I'm going to say your last name. Hopefully it's not wrong Corinne Clay, corinne, mr Clay, I'm going to say your last name. Hopefully it's not wrong. Corinne Clay, corinne, perfect, yep, perfect.

Andrew Silver:

Clay is the CEO and founder of FreshX, a company that is attacking the reefer LTL space. Which man this business has been needed? It's interesting. I think in either the first or second FreightPod episode ever I can't remember which one, whether it was Kevin Nolan or with Ted Alling we spent quite a bit of time talking about a reefer LTL business, and I just think it's something that's been needed in our space for a long time someone to try to solve that problem. So I'm really eager and excited to learn more about what you and your team are building. But before we get into the business, let's talk about Clay the person, clay the man. Why don't you just tell me a little bit about yourself, your interests, what you'd like to do growing up, and eventually we'll get into the freight stuff? But just talk about yourself for a minute.

Clay Curran:

Sure, yeah, and thanks for having me on. I'm excited to be here. So I guess, yeah, my background I grew up in New York, in Westchester, new York, outside the city in the suburbs, and I was always pretty, I think, distracted growing up and didn't have the best focus in school and everything. I got OK grades but always was kind of getting distracted and exploring new things. To college in Ithaca, new York, upstate, new York, at Ithaca College and didn't really know what I wanted to do at the time. But they had a great music program and I always liked to play the drums and play guitar and so just went to take music classes and then figure it out along the way.

Clay Curran:

So I pivoted majors a few times. In undergrad I went from physics to creative writing, to business and ultimately settled on finance, and so that was undergrad. After I graduated I moved to Manhattan and worked at a fund called Prospect Capital. It was a private equity and private debt fund and I was doing a mix of different things throughout my four years there. I was trading bonds, structured products, I was working on the balance sheet of the portfolio and then handling fundraising support. So got to see all kind of the different sides of that business.

Andrew Silver:

Was there anything in that business that brought you to freight?

Clay Curran:

or was there anything freight related in that or not at all? My first kind of time to learn about LTL and one of our. We had a loan to Global Trans and so I got to learn a little bit about that company from the deal manager on that. So it was a little bit a lot of private equity companies touched logistics and so I got to kind of see things from a pretty removed standpoint. But yeah, ultimately I didn't really love finance. It felt like I was kind of very abstracted and removed from the real world problems and that's why I decided to leave that position and go to business school and find something new.

Andrew Silver:

And did you always have an itch to be an entrepreneur, start your own business, or was that something that came along further once you had an idea?

Clay Curran:

I think I always did. I don't really like following rules and being told what to do, and so I think that it was always the only thing that was really going to make me happy and satisfied. My parents are both entrepreneurs so small businesses but I got to see that growing up and got to see the kind of freedom they had and the autonomy and they really enjoyed running their own business, and so it was nice to see that that can the freedom they had and the the autonomy, and they really enjoyed running their own business, and so it was um nice to see that that can be a rewarding path what's?

Andrew Silver:

what's something you learned from your parental entrepreneurs, that, um, that you've kind of taken as a lesson to bring into your own journey.

Clay Curran:

That's a good question, I think so. One thing is my mom was originally an art teacher and then she decided to open up her own interior design firm and I think that she didn't really feel like she was ready and she was always on the um, on the edge about it, on the fence, about whether she should uh, make the make the jump and start a company um. And she ended up doing it and it ended up working out and it. It was slow to start, but it over time she was able to build a brand and um and build a customer base, and so so I think the thing I learned is just to take the leap and you can figure it out as you go. It's not going to be crystal clear from the start. You have to work at it and build it over time.

Andrew Silver:

Yeah, I think that's a very valuable lesson, especially for startups, first-time founders. It's like I think a big mistake some people make is trying to get all the answers before they do anything because out of fear of I don't know failing or looking like an idiot or missing a step. It's like you can figure out a lot of things along the way and you know Bogart, my partner from Mola, used to constantly make reference to this. I don't know if it's an analogy or what, but you basically said you know this business is like building a plane while you're in the air and you're flying it and there's still pieces that need to be screwed in and things need to be added. And you just got to figure it out. Keep the the plane afloat and keep attacking and solving problems and things will work themselves out. And I think that's a very wise way to think about it, because you'll have analysis paralysis if you just sit around trying to get the answer to every question before you kind of say, go and start moving.

Clay Curran:

Yeah, and we definitely had that experience too, and I think we not only, like, built the plane, while we were flying it, we changed the whole plane. We ended up totally pivoting, switching business models, switching customer bases. So we actually, over the span of two years since we launched the company, we got to revenue twice and then shut down the business and started something completely new. And so it was all about learning and, I think, iterating really really fast and kind of just learning as quickly as possible and making those changes.

Andrew Silver:

Talk a little bit about, like when you say kind of two massive changes, like what was the original business idea for FreshX?

Clay Curran:

two massive changes Like what was the original business idea for FreshX? So the original business idea was a last mile delivery business and so we were going to market as a carrier. We were going to build a model similar to Veho, where we used outsource gig worker drivers and built a last mile business around the food and beverage space. So that was the one thing that kind of stuck the whole time was food and beverage. But we initially were trying to work with those companies to make their last mile more efficient, basically try to take a lot of the packaging out of the equation and basically pack the boxes closer to the end destination. So that was it. We ended up running a pilot, we delivered packages for a summer and got a paying customer for that. So that was phase one. We actually had a different name. We were called Orca.

Andrew Silver:

Uh, and why? Why did Orca? Why does? Why did Orca not make it? Why did you pivot from the Orca plan?

Clay Curran:

So we, we um, it actually was uh kind of working. So we had some, our our pilot customer agreed to roll out across Chicago, and so we were hitting the right milestones. We ended up getting funding right after that. But we kept hearing from the shippers, the food and beverage companies, that there's this bigger problem upstream and that was reefer LTL. And so they just kept telling us reefer LTL you know, what you're doing is kind of kind of a pain point but there's this other thing that's really bugging us and it's probably going to prevent what you're trying to do from really working.

Clay Curran:

Where I think what happened, uh, and one of the light bulb moments was we.

Clay Curran:

We had a customer that was manufacturing um salad kits out of I think it was Virginia, and we wanted to run a last mile program for them in Chicago.

Clay Curran:

And we said, all right, ship them to us on a refrigerated truck and then we'll set up the last mile distribution. And they said, well, we have no way of getting them to you on a refrigerated truck, we have to pack them in boxes and put them on a FedEx truck, because that's the only way we can get reliable LTL to Chicago. And so we realized that there's this deeper problem that was going to prevent a lot of efficiencies from happening, I think. For like a couple of weeks we thought we could try to do it all and work with these companies to manage their entire fulfillment process, end to end, and then we at the end of the day realized you can only really focus on one thing as a startup. You have to be really, really focused, and Reefer LTL was the bigger problem, and so we totally threw aside the last mile business and got our brokerage authority and started brokering reefer ltl okay, so you pivoted to become a reefer ltl broker.

Andrew Silver:

Yep, and that was fresh x logistics. That was fresh x logistics yep, and so we that was the time and when did you make that pivot?

Clay Curran:

That was October or maybe November of 2023 is when we started brokering freight and it was a small operation. We had a handful of customers. It was just me and my co-founder, lance. We've been co-founders throughout this whole thing as we've shifted models and gone through all these changes, but we started brokering freight then we really didn't have any idea what we were doing. We didn't have a formal freight background. We had an advisor, lars, who we ended up booking our first load, and then we called Lars and we were like Lars, what do we do? Do we need to sign something? And he walked us through it and we ended up building processes and building a book of customers that kept coming back to us.

Andrew Silver:

What was it like trying to run a brokerage with zero experience?

Clay Curran:

um, it was really tough, especially because we we really focused on reefer ltl, which is just such a difficult thing to handle for for free brokers. Um, so we I mean we were we were flying blind. We we got lars was a good advisor at the time and he walked us through a lot of it but we were really figuring it out as we went along and it was interesting that we were still able to capture customers. I think that the reefer LTL focus was a part of that. Just that niche focus allowed us to get in touch with those customers and give them something that they wanted. So difficult but not as hard as we thought it might be.

Andrew Silver:

Yeah, I will say if I was a sales rep and I just wanted customers to at least respond to my email or give me a chance, I would solicit, I would offer reefer LTL capacity Because you probably, of all the things you could reach out to a shipper and offer support on, reefer LTL, probably is the highest percentage chance of garnering a response. Now, what you do once they give you the freight or the opportunity, that's a whole different ballgame and has historically been a very challenging thing to navigate. But that's partially why we're here, so we won't jump into that yet. I just want to sit on the brokerage for a minute, though. I'm curious, like what were some of the lessons you learned pretty quickly about dealing with reefer LTL freight that, especially coming without an industry experience, were eye-opening or insightful for you?

Clay Curran:

Yeah, I think that one of the things that surprised us, and that still continues to surprise us, is that there are a lot of these carriers out there that do refer LTL and a lot of folks think that there's only like one to five refrigerated LTL carriers, but there's actually well over a hundred.

Clay Curran:

A lot of them are really specialized and so they run specific lanes Maybe they do chilled LTL from Miami up the East Coast and each one is specialized in temperature and they're specialized in commodities they run. They don't run certain commodities, but that specialization allows them to create enough consolidation for the operation to be profitable. So there was that. There was just learning about the carriers. One thing I found interesting we went and met with a lot of these carriers in person, starting out just to build those relationships, and the overflow of emails was something that was pretty interesting. So they get inundated with quote requests and orders all day long, and I'm sure it's the case for a lot of carriers, but for Reefer LTL in particular, I think it's just pure chaos dealing with all these inbounds.

Andrew Silver:

So yeah, Are a lot of those inbounds coming from brokers or from shippers directly trying to utilize the services?

Clay Curran:

Yeah, it's a mix and it depends on the carrier. So some carriers are more known for spot and so those carriers will be more broker heavy. Some of them will have more contract shipper customers and it's interesting to see how those companies have evolved over time to have those different specializations and reputations.

Andrew Silver:

Yeah, that is interesting and I actually had a similar kind of purview or perspective as the kind of misnomer you described. Where you know we knew about FFE Frozen Food Express as like the big national reefer LTL guy. But most shippers that I knew of didn't have necessarily favorable opinion of them because it kind of felt like they had a monopoly on the market. And then there were what I knew of were some regional players, but it never felt like enough to really make reefer LTL a foothold in my business, whether I was a sales rep or you know at molo as a company, because it just felt like there just wouldn't be enough capacity to really service your customers in a way that you felt comfortable committing um. So I'm curious okay, you, you know you're running fresh x logistics, you and your co co-founder. You're kind of running out and trying to get some loads and meeting with these carriers to develop relationships there. How long did you do that before you thought like maybe this isn't the right way to run our business?

Clay Curran:

It wasn't that long. I think the first shipment we had to deal with went sideways and got lost in a warehouse somewhere in California and we realized really quickly that we weren't going to be able to build a tech company and a brokerage at the same time and we had to pick a path. Um, we were just so distracted by the um, by the brokerage and all the manual operations and everything um, and we also realized that we weren't going to be able to scale the brokerage the amount that we wanted to, because with ltl you, to make the economics work, you need consolidation, you need enough volume to make the economics really work and as a startup brokerage, that's just impossible to get off the bat. So we realized that we had to build a tech platform that could tap into a wide variety of freight brokerages and aggregate that volume in order to make the economics work.

Andrew Silver:

Are you looking to grow your brokerage? Are you struggling to land new customers in these challenging market conditions? Look within. So many companies that tender you freight throughout the domestic United States also have business coming out of Mexico. A year ago I understand why you might not have seen that freight as an opportunity, but today Cargado exists and that means any load coming into or out of Mexico is now an opportunity for you to support. In just over a year I've been able to see Cargado go from ideation to launch to rapid growth. It's amazing to see how many logistics companies have been able to use Cargado go from ideation to launch to rapid growth. It's amazing to see how many logistics companies have been able to use Cargado to expand into Mexico to grow their business.

Andrew Silver:

Cargado is the first platform that connects logistics companies and trucking companies who are moving freight into and out of Mexico. If you move Mexico freight or are planning to reach out to Cargado today at cargadocom, that's C-A-R-G-A-D-Ocom. And so what did the pivot look like? I mean, you had raised talk to me about the fundraising journey for, I guess, each of your businesses, or was it one fundraise, and then you've stuck with those partners and they've navigated the pivots with you. What is that experience? Is that experience Like how talk to me first what you did and then I'll kind of follow up?

Clay Curran:

Yeah, so it it actually is all one business and that's because it it wasn't really um. The business evolved over time where we were doing one thing and then we were slowly trying something else and we relied on the funding to get us through those pivots. So initially we had raised um only 25 000 from um university of chicago and we I went full-time on uh on that funding and uh, I was like this is to last us six months max, but we'll give it a shot.

Andrew Silver:

Six months on, 25 grand would be impressive.

Clay Curran:

Well, I was burning my own cash, yeah yeah. So we got a developer that worked for free. He was a student at the university, so we got by, but not very much, though we ended up getting into an accelerator and raising a bit more money. We had raised about 200K by the time we had totally pivoted into a freight brokerage. We tried raising as a freight brokerage and we were going to build a tech platform around the brokerage and be kind of like flock freight for refrigerated was the idea, and I think investors had lost a lot of appetite for the tech-enabled freight brokerages, and so we ended up not raising any money under the brokerage model. But once we pivoted, it became pretty apparent that we had something that investors were more excited about.

Andrew Silver:

And what was the process of trying to raise money as a non-freight experienced individual? How challenging was it to generate interest with or lack of experience?

Clay Curran:

And yeah, it wasn't. There was definitely that kind of question and we got some good advisors. We had Lars, we had your brother Matt advising us through the whole process, so it helped to be in touch with them and have them in our fundraising material and helping us out along the way we had. I always told investors we had, like we learned 70% of what we needed to know by brokering freight ourselves and then the other 30% we got from our advisors. Our lead investor that ended up leading the round ended up investing because he knew the problem that we were solving really well, so he knew it was real. He had portfolio companies that are shippers that had dealt with that problem. They had a food focused VC fund out of Chicago and so they they ended up just saying you know, this is a real problem that we see you're solving. We believe in you guys to execute on it.

Andrew Silver:

Okay, and so when exactly did BrashX become, become a thing?

Clay Curran:

So we closed the free brokerage down totally in, I think, April of last year, 2024. We ended up raising money by July, so we went through a business plan competition and won a million bucks out of that and then shortly after closed the round within a couple of weeks so added another 1.5.

Andrew Silver:

That was Chicago Booth's new venture challenge deal. Yeah, yeah, it was. What was that experience like?

Clay Curran:

that was, uh, it was a really competitive competition. So the, the university of chicago's school of business, holds this competition every year.

Clay Curran:

Um, there's, I think, 80 teams or so that apply to it and then there's different stages where teams get eliminated, and in our cohort there was about 2 million in prize money and 1 million of it went to the first place, so we ended up getting a million dollars out of it. But it was a tough competition. There were a lot of other companies in there with revenue that seemed a little bit further along than us, but we had, I think, built up a lot of fast traction with freight brokerages and with carriers, and we made that pretty clear in our pitch.

Andrew Silver:

So now, what exactly? I think we're at the point now where I want you to tell me exactly what FreightX does the current business after two pivots.

Clay Curran:

Yeah, so Fresh X is sort of a marketplace for refrigerated LTL. So what we ended up doing is we built relationships with most of the refrigerated LTL carriers across the US and some in Canada. We have a little over 80 carrier partners currently. Those carriers have worked with us to map out all of their pricing, their rate sheets, schedules, and we've built a pricing engine around it, and so then we sell a product to freight brokerages that looks like Google flights for refrigerated LTL, so freight brokerages can go in. They can run a search with zip codes, pallets, weight, temperature, commodity and get back instant price quotes from refrigerated LTL carriers.

Clay Curran:

It's the tool that we wish we had as a freight brokerage. Back when we were brokering freight, we found that even if you knew the 10 carriers that did LTL reefer out of Chicago, you still had to email them all for a price quote to find out who's going to be best on any given lane, and that process was time consuming. You'd end up waiting hours to get a response. Half of them don't respond to you at all, and so this is something that we had tried to back into their pricing and do this all different ways, but the need for instant rates was really clear to us.

Andrew Silver:

And so do the carriers provide you the rates in advance, or you help them to develop the rates.

Clay Curran:

They provide us with the rates in advance. So they send us over rate sheets in different formats. Sometimes it's PDFs, spreadsheets. Whatever they have on hand, it's either 100-weight-based rate sheets or it's pallet-based. They apply fuel surcharge. But we work with them pretty closely, almost in a consulting partnership, where we are building maps and showing it to them and saying, does this look right? Do you want us to shave off Sacramento? And we map it out pretty closely with them, get all the rates dialed in and then have them test and then, once they approve the rates, they go live to all of our customers.

Andrew Silver:

What's been the most challenging part of the early stage of building this.

Clay Curran:

Yeah, I think it was definitely getting all the carriers on board. Um we, when we first started um, we had like one carrier partner for the first two months and we were trying to get more carriers online. We ended up building the entire rating engine around this one carrier's pricing and then found out that it was totally different than what the rest of the market did and we had to throw the whole thing away. So, building those relationships early on and getting carriers to trust us and actually see that we're trying to do something good here and grow the pie we're not trying to we're not a brokerage, we're not trying to steal their business it was hard for us to even get those conversations, let alone get them to provide pricing and coverage to us and invest their time into working with us.

Clay Curran:

The way we ended up accomplishing that was traveling a lot in the beginning and we would go out to Florida or Wisconsin or wherever and meet with the carriers, meet with the owner of the company usually and talk to them for a couple of hours and show them mock-ups. Kind of funny how these carriers are really standoffish on the phone where it's like hard to get them to talk to you and listen to what you're saying. And then once you show up at their dock and you meet with them in person, they're super friendly and they're down to talk to you for hours. So that was kind of the unlock for us in the beginning was traveling around and just building those real relationships with those folks and showing that we were, you know, we were willing to invest that time ourselves.

Andrew Silver:

Yeah, I was going to ask, why do you think that is? Because I've I've noticed that too and I think you could say that's true on the carrier side. It's also probably true on the customer side, where people can seem so standoffish when you call cold call them or email them, but then once you're face to face, sitting in their office, it's like a whole different person I think I mean, I think that's probably, it's probably true for me a little bit.

Clay Curran:

I think they just get a lot of spam calls, um they're. They get a lot of, I think, uh, a lot of freight brokers and shippers probably calling them asking for price quotes, and then it doesn't end up end up turning into a real business opportunity.

Clay Curran:

So it's a lot of time, I think their time is wasted yeah, yeah, um, so I I think that that's probably a pretty big part of it. Um are, some of our carriers have had bad experiences with brokers in the past using their own pricing against them or back soliciting them, and so there's definitely among the carrier base a little bit of aversion to freight brokerages, which we're trying to solve with the platform and provide more transparency, vetting around the brokerage customer base and then also streamline the process of quoting so that the normal process of carrier quotes 10 shipments just to win one On our platform. It's a little bit more attractive for a carrier because they get a load sent to them pre-quoted at their rate.

Andrew Silver:

Got it, so it already has to meet the requirements that they're looking for for it to even show up as an opportunity for them. Yeah, that's right. I like that. And in terms of the on the other side from the carriers, are your customers exclusively brokers, or can shippers sign up as paying customers as well?

Clay Curran:

They are, I think, almost completely exclusively brokers. We have one shipper who signed up, but most of the time it doesn't make sense for shippers to sign up for something like this. Shippers to sign up for something like this, it's for brokers. The value proposition is that this is a way for you to acquire customers or a way for you to grow your business with an existing customer. For a shipper, it's for a broker, it's a way to open up that capacity for a shipper. If the shipper wants to work with carriers directly, they're going to work with carriers directly and they would have no need for our platform because once they establish that relationship with the carrier, they're going to set up a recurring contract lane. So for probably 99% of shippers, our platform doesn't really make sense, whereas brokers have a much greater need for capacity everywhere that they can constantly plug in new requirements and find the best available capacity for those lanes.

Andrew Silver:

So we have, I think, 70 or so freight brokerages signed up today and one ship we're using it can we zoom out for a minute and talk about reefer ltl in general and just kind of walk me through how it works and what are the big challenges and and the reasons that, um, it's such a tricky business to to participate in?

Clay Curran:

yeah, so um so refrigerated LTL carriers are really consolidators. So what these businesses look like is they're usually third generation family businesses or so that have been around forever. They have a reputation. They have a cold storage at least one cold storage cross dock. Sometimes they have up to 10. And they have a fleet of, call it, 25 to 500 assets and so these carriers are picking up around their facility, usually throughout the week and they're picking up and call it a hundred mile radius around the facility. They consolidate at the cross dock and they specialize in specific temperatures depending on the storage space they have and specific commodities. But they consolidate and then they ship out, usually on Thursday or Friday, to wherever they go. They usually hit all their deliveries Monday and Tuesday of the fall in week and that's so the retailers can restock their shelves by the end of the next week. So it all ends up kind of fitting around the retailer schedule. But these I would say 80% of the referral TL carriers out there operate that way. So they usually have a constrained pickup area where there will be a number of referral to yell carriers out of Chicago. That's totally different than the network out of Los Angeles, but across those carriers they'll go nationwide depending on what they specialize in.

Clay Curran:

But there's I mean there's there's a carrier called Badger State Western. That's one of was one of our earliest partners. They're based out of Abbotsford, wisconsin. They pick up, I think, about 150 miles around Abbotsford and then they ship out to the West coast and then they ship out late in the week and then they ship out. They ship back from the West coast, the LTL backhauls back to the Midwest the following week, and so it's these folks that are like for Badger State Western. You would never know that this carrier existed because it furgals West Coast backhauls, because their facility is in Abbotsford and so these carriers have this kind of hidden capacity. A lot of times that's really hard to map out from an abstracted view that a brokerage has and in terms of the individual companies, once they consolidate they'll have, call it, six dispatchers that split up the country by geography, and then they're going to be setting multi-stop delivery routes as those orders come in throughout the week, and so they're sort of optimizing and recreating multi-stop routes of 10 to 15 stops every week by usually Wednesday night.

Andrew Silver:

And so I guess, when you think about the problem in general, it could maybe best be described as there aren't enough of these Badger State Westerns in the carrier community to account for the amount of one pallet, three pallet, six pallet orders of refrigerated food and other freight that shippers need moved, and there's not a great system out there to aggregate all the product in a way that is efficient and safe in terms of keeping temp and um reducing risk of, you know, issues I think yeah, and I think the the real problem that we solve is unlocking the hidden capacity.

Clay Curran:

Um, in that badger state example, I had a broker that was looking for a carrier to ship from the Pacific Northwest to Chicago and they couldn't find anybody. I pulled up Badger State Western and it was an attractive rate, but they never thought to look in Wisconsin for a carrier that could do LTL out of the Pacific Northwest. So there's just a lot of that hidden capacity that you kind of just need to do that work up front of mapping everything out and where all these carriers go in order to make that available easily for free brokerages.

Andrew Silver:

And how does commodity matter? Or does it with respect to your business and the matching of carrier to opportunity?

Clay Curran:

Yeah. So I guess there's one thing to be conscious of is that the transit times in reefer LTL with consolidation are usually like five to 10 days, depending on when you're booking that Um. So there's some commodities that just won't work most of the time, that really highly perishable stuff Um the commodities that we actually see on the platform. If I could like roughly break it down, we see a lot of uh meat. Poultry fish Um, that's like the number one commodity. Poultry fish um, that's like the number one commodity. We see um juice concentrate, um dairy products. We see like uh coffee and powders, alcohol and non-alcoholic beverages um, across those. I think those are the uh like the top five or six.

Clay Curran:

Typically, one thing that we've found kind of interesting is that some of these commodities have really tight temp requirements. So you might have a specific produce commodity and we can't guarantee 36 degrees continuous gets requested with the carrier. We connect the carrier and the broker in an email and they communicate directly to work out all the specifics and whether this commodity is actually going to be a fit, whether there's risk of cross-contamination. Because of the nuances of this mode you have to kind of just open up the communication channels and let folks coordinate directly around those types of things communication channels and let folks coordinate directly around those types of things.

Andrew Silver:

Yeah, I'm curious like do you bear any responsibility when a claim arises due to you know temp issues or you know cross-contamination things of that nature? Have you had anybody come back and point the finger at you, or do you completely absolve yourself in the transactions?

Clay Curran:

I mean, yeah, so we're not co-brokering. So our pricing model is that it's a subscription for brokers to access the platform, but we don't even take transaction fees. So we're not dealing with claims or anything like that. We make it clear. You know, this is part of the reason why we had to do this. Pivot is it's just so distracting dealing with all those types of things. So we're positioned more like a load board where it's a subscription access set, but the service we provide is visibility. It's not co-brokering or anything like that.

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Andrew Silver:

Have you had issues arise on the platform with, with? You know claims and such and and like? Is there anything you can do? Like? It's clearly a problem. There's a reason that you moved away from it in your own business initially, realizing that the claims are a big problem, and it's why I think a lot of companies stay away from it. I'm curious. I definitely see. If I was you, I also would kind of hands off, avoid bearing any responsibility there. But I'm just curious if there's anything you can do as an organization to help mitigate some of those issues arising.

Clay Curran:

Yeah, so the claims rates that we've seen are really low, much, much lower than we expected. We thought that we'd be seeing claims a lot more often, and I think I've only seen one instance where there was a claim. Now maybe it's happening outside of our purview and it's just going directly between brokers and carriers. There's only one that we've been aware of and we've seen 1,500 loads booked on our platform to date, and that's on the platform. There's more business happening off the platform when a broker and a carrier develop a relationship and they set up a weekly run. So it's at least in terms of what we've seen. It's actually much lower than we expected.

Clay Curran:

In terms of like what we do, we I mean we leave a lot of the vetting process up to brokers. We want to be a sort of like Switzerland third party where we're not picking and choosing which carriers are on the platform versus off, so brokers do their own vetting process. We are going to start displaying in the next, I think, week or two more stats around liability coverage for each of these carriers. So typically these carriers have the standard 100K cargo liability and then they sometimes have a per pound insurance liability limitation, and so that's going to be visible on the platform within, I think, within the next two weeks, on the quoting page so in essence, your business is kind of working to digitize as many of the processes in refrigerated freight as possible versus like fundamentally rethinking how to move refrigerated freight right.

Andrew Silver:

It's not the latter, no, yeah, it's like a massive yeah, you're right yeah, yeah, it's um, I mean really, we think about it as it's.

Clay Curran:

It's visibility into capacity. So we are making capacity and pricing more clear to freight brokers. They can more quickly and easily make decisions around which carriers to reach out to for a given customer, around which carriers to reach out to for a given customer. That's how we're thinking about our roadmap as well. So, outside of Reef for LTL, a couple of things that we're looking at right now are one is on the transportation side, backhauls. So we're working with one of the leading refrigerated private fleets in the US to post their backhaul capacity pre-priced as temporary capacity.

Clay Curran:

A lot of our carriers need backhauls because they finish their multi-stop route across the country somewhere and then the driver needs to get back, and so they need truckload backhauls. So we think that there's an opportunity to make that backhaul capacity more available on the same platform. And then the other thing that we're pursuing right now is cross-docking for OS&D. So when a pallet gets rejected needs to be reworked, or whatever, pallet gets rejected needs to be reworked or whatever, it's going to be a simple, map-based interface that brokers, carriers or shippers can go into and easily find cross-docs with the services that they need.

Andrew Silver:

That's another big problem in this space that is lacking. How do you approach that one in terms of creating?

Clay Curran:

a solution for it.

Clay Curran:

So the way we're thinking about it currently is like Airbnb for crosstalking is how we're summarizing it but it needs more work, more customer discovery around what exactly the solution is going to look like. I know that the real challenge is going to be aggregating the supply side, the capacity, and getting accurate data. It's nice that our carrier base is like a perfect partner base to start with on this, because across these carriers, we have like 150 cold storage cross stocks across the U? S and these carriers, for the most part, all offer re-delivery services, reworking services, so they're they're really well positioned to be that that like beachhead market for this product. We've heard about food pantries as a creative kind of alternative that a lot of brokers typically look for when they're trying to find a quick solution, so we're going to be approaching food pantries and just building a really comprehensive map of anybody out there that offers these services.

Andrew Silver:

How do you go about doing that? Is that like ground and pound, just like pick up the phone and start calling food pantries, or is there a more methodical or, I guess, strategic way of doing it?

Clay Curran:

Yeah, I guess it could be ground and pound. I'm sure to some extent it'll be ground and pound Got to be. But yeah, but we're also going to. You know, we're talking to a few potential partners on this who may already have a good amount of this data. It might not be as structured as we need it to be, but we're talking to a few folks where we could do some kind of data deal and just purchase that and use that as the at least the foundation to build everything else on top of and crowdsource the additional info as we go.

Andrew Silver:

So you mentioned, 1500 or so loads have been booked through the platform so far. Are you happy with that being where you are today? Where do you want to get to? How do you think about the growth of the business and how do you think about injecting or putting rocket fuel into that growth? What can you do aside from coming onto this show, where all the brokers will be listening and hopefully call you to get their refrigerated LTL capacity?

Clay Curran:

Yeah, yeah, no, we're I mean we're. We're in growth mode right now, so we've been roughly doubling or, yeah, roughly doubling volume each month since since we launched. We just hired two salespeople, so one started April 1st and one started last week, and so we're definitely starting to try to roll this out a lot more quickly to the broader brokerage community. I think it's something we say that every brokerage that has food and beverage customers should have something like this, because it's a tool in the tool belt that you need if you want to be a full service brokerage. So goal for us internally is we want to get to a million dollars in revenue this year. That's our kind of nice even goal.

Andrew Silver:

And how do you make that happen?

Clay Curran:

Just hitting the road. We've been going to conferences. So we went to Berkley Carrier Summit, food Shippers, manifest, tia, and we're going to be at, I think, smc3 and F3 and a few others for the rest of the year. So conferences are really good for the rest of the year. So conferences are really good, but it's all about just spreading the word, and leveraging social media has been a great source for us. A lot of our leads are inbound, so we just get. We're commenting a lot and I'd say like 80% of our inbounds say that they saw us commenting on something on LinkedIn or somebody tagged us. So we're really leaning into LinkedIn and trying to be as active there as we can.

Andrew Silver:

I'm curious, like what kind of pushback would you get from, like, let's say, you call up XYZ broker and they take your call and you tell them what you've got. What reason do they have to say no, or what pushback have you gotten?

Clay Curran:

That's a good question. I think the number one thing is we don't do referral TL today, so we don't really need a product to handle referral TL if we don't have any of it. And we have to kind of tell them and show them that this is a tool to acquire customers. You know it's not. You're not going to make a ton of money doing referral TL, even if you do manage referral TL today, maybe you'll get a slightly better rate on our platform. But what it's really valuable for is going out to shippers and saying can I quote your referral TL? I'll find you a reliable local carrier that can cover it. And we have to position it that way and make sure they understand that this is a way. You have to be willing to like invest time into building out this strategy as a way to start conversations and open doors. But it's definitely something that to start conversations and open doors. But it's definitely something that, yeah, some folks are more comfortable with that than others.

Andrew Silver:

Yeah, I mean, if you participate in food and beverage, this is something you should be doing. I just I don't understand why you wouldn't. I mean, I get on one side. Someone could say I wipe my hands of it, I'm not touching meat for LTL, I'm worried about the risk, but that's why I disagree with and I don't know if maybe I heard it right, but that you're not going to make too much money. If anything, I think you can make more money on Reefer LTL than you can on a lot of truckload, and it's just the simple concept.

Andrew Silver:

Yeah, higher margins. I just think it's the simple concept of if there are fewer people pursuing it, there's less competition, there's more opportunity to make more money doing it right. I mean there's riches and niches and everybody, everybody, everybody and their mother, is calling Coca-Cola today wanting to haul their dry beverages that are 45,000 pounds and you know, one pick, one drop, easy, come easy, go no touch. And when everybody's calling them and there's so much competition, there's not a ton of margin on a load-by-load basis. Not everybody is calling and asking to take your four-pallet reefer LTL load from LA to Fond du Lac, wisconsin, and so there's less competition, more opportunity to quote a little bit higher and expect a little higher margin.

Andrew Silver:

So I don't know. I don't know why. I don't know why, like I wish I had this tool as a broker, just because it's it was frustrating. I always wanted to solve, to figure out how to do Reefer LTL and I think that this is one step. I do think there's like a fundamental solution that could be created, solution that could be created, but that's like what I mean is I don't think there's enough available capacity for the amount of reefer LTL that is needed in the market today and that's a structural issue in the industry, more so than it is a technological one. I think that you're figuring out how to make lemonade with lemons, and that is to take the existing infrastructure and capacity and apply technology in a way that creates the visibility that you're talking about, which, again, that's a solution and it's better than what was available yesterday.

Clay Curran:

And I think the I mean our hope is that the capacity can grow and, like, basically, these businesses can grow over time and as more freight flows to LTL consolidation versus truckload, those companies will lease more assets and grow their coverage base. So we had a carrier reached out to us because they were getting a good amount of business through the platform and they said, hey, we want to open up a new lane out of Dallas and they previously had nothing out of Dallas. And they said we want to open up Frozen out of Dallas. Can you help us build the volume? And we said, yeah, sure. So we launched it and they're already getting volume through the platform. So I hope it can be like you know, lifts all seas kind of thing, and help the LTL consolidation industry grow and become more attractive in the process.

Andrew Silver:

Yeah, see that. So that was where I was going to go. Next is I wonder if there's a way where you can leverage enough data to create the capacity, what's available in terms of where is the freight that needs to be moved? Then it's as simple as going to some of the existing carriers on the platform and say, hey, right now you're running from Portland to Wisconsin. I see that among the 50 brokers here who've been hosting opportunities in the last few months, there's, there's, there's enough break going from I don't know twin falls, idaho to Wisconsin. If you just set up a, an option there for to pick up freight and whatever, and you can make it a consistent sailing schedule for you to run. So, like I almost feel like you know chicken and egg, you can be, you can be the one feeding the opportunities back to the carriers to say like there's, there's enough right here to make this a meaningful part of your business yep, yep and we're gonna.

Clay Curran:

We're definitely planning on doing that and helping them see where the opportunities are to grow and fill that demand. Um, we're currently working working on a carrier user interface where they can get a dashboard and see where those opportunities are. I mentioned the loads number, but the search volume is much higher. We've had over 50,000 searches since we launched six months ago, and so all that search volume is pretty valuable to the carrier base in terms of just seeing where that volume is and what is uncovered by the existing carrier base, which we have most of it on the platform currently, and there's definitely pockets. I mean there's a few lanes that come to mind right now that I'm like there's a lot of searches from, like, arizona to the East Coast, for example, that there aren't a lot of carriers that cover that, and so there are probably a handful of these opportunities that I think are ripe for picking.

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Andrew Silver:

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Clay Curran:

Yeah, and we usually do like a training session and we try to get as many people on as we can because we want to. We know that for a lot of these brokerages they're stepping into this for the first time and are not as familiar with how this works.

Andrew Silver:

So we go over a lot of this in those calls.

Clay Curran:

But the main things to be aware of are schedules just what the schedules look like and what you need to be aware of in terms of transit time. If you book earlier in the week, most carriers are shipping out at the end of the week most LTL reefer carriers and so you want to try to book before Wednesday night or else you're going to miss the call off and they already set all the routes and they assign drivers, so earlier in the week the better. Another it's. It's hard to guarantee service. You shouldn't necessarily um assume that a carrier can do something. You need to get them to confirm it because it's it's constantly in flux and it's it's so. Um, there are so many nuances to refer LTL in terms of uh commodities that can and can't be matched up specific type temperature requirements, um, and so it's. It's. It's currently. It's still in the state where there needs to be a conversation with the carrier and you need to make sure that you're on the same page about what needs to get done. It's not as transactional as a truckload can be.

Andrew Silver:

Yeah, I mean yeah because those little nuances. You know a dry truckload that misses its appointment and can probably get dealt with the next day without issue. You have a little bit more risk on a perishable reefer LTL load that misses a delivery by day. There's more risk there.

Clay Curran:

And the other thing I would say is that it's pretty bad if you burn these bridges, because there's not that many of them. So if you burn the bridge for the one referral TL carrier that does chilled fresh seafood out of Florida, there's no fallback options and we have seen some brokers treating this more like a load board and treating carriers more transactionally and that's a bad experience for them because then they, once they lose that relationship, they lose that coverage and that kind of capacity, and so the folks that have the most success are the ones that are building relationships with the carriers and thinking of them as partners versus just capacity, commoditized capacity.

Andrew Silver:

Do you bear any responsibility, or at least in your mind, to to kind of manage the quality on both sides, like, is there any kind of review system or process by which someone gets removed, you know if someone's super disrespectful, or they treat a carrier like shit or they don't pay the carrier or vice versa, the carrier does a bunch of shady stuff to the broker? Are you getting those phone calls and if so, where do you feel you have responsibility to step in or do something about anything there?

Clay Curran:

Yeah, that's another good question. Yes, we do jump in if there are issues like that. We have removed customers and we have removed carriers for that reason. So the platform is a marketplace and in a marketplace everyone has to have a good experience, or else it just doesn't work.

Clay Curran:

And so we're paying close attention. We have an assistant who's monitoring literally every load that gets booked and the conversations that are happening and making sure things are going smoothly and then flagging anything for us that needs attention. And there's hundreds of loads getting booked a week right now, so we're we're really staying on top of everything, making sure that this takes off in the right way. Um, and the things that we've we, we the main things that we've kicked off carriers for is just being unresponsive and just not. A broker sends a request and the carrier never replies to the shipment, even after we coached them through it a bunch of times, and that's just a bad experience for brokers. We had a broker being pretty rude to a carrier and multiple carriers, and then we had to talk to them and tell them that we need to pause their account. So it happens and we're doing all we can to stand top of it right now. Okay.

Andrew Silver:

What's next in terms of the roadmap and what you're building, and you talked about a few things you're thinking about, but like what's in the immediate future next three to six months in terms of the fresh x journey yeah, so we are um, we we launched our api recently, so now we're doing TMS integrations and we're talking to a few TMSs, working on how that's going to look in those portals and then unlocking that new capacity.

Clay Curran:

So the backhauls and cross-dock network are two things that are in our short-term roadmap, but those are the things we're focused on right now. And then on the carrier side we're working on more visibility into where those opportunities are, just like you were saying earlier, helping those carriers to see where opportunities are to open up new lines of business and whatnot.

Andrew Silver:

So that's kind of what's in the pipeline right now and any advice you would give to the aspiring entrepreneurs of the freight industry who are, like yourself, itching to make a name for themselves, to make an impact? Um, just from your, your, your own experience in the first few years of your entrepreneurial journey.

Clay Curran:

Yeah, um, I guess, uh, I mean one one thing is um, advisors are, I think he um, so you got to get good advisors that can help show you the way.

Clay Curran:

That's been really helpful for us to make better decisions faster.

Clay Curran:

And you know, there's all the just conventional wisdom of iterate really quickly and build prototype products versus production products in the beginning, because everything gets ripped out.

Clay Curran:

We've ripped out our product already, rebuilt the whole thing and we're constantly just shipping stuff and then removing it and building fresh. So it's I think that the most important thing is speed how quickly you can just build things and test them and then replace them if they don't work. Those are the two things that come to mind. And the other thing is that we, like I think we were able to find this problem pretty quickly by just like doing a lot of customer discovery. We, back when we were doing the last mile business, we talked to about a hundred shippers and just like we're just trying to learn everything about their supply chain where the problems were, um, and just like asking them just tell us everything that happens in your supply chain, where the where the hiccups happen, and so I think that um, finding a real problem helped us starting out to get a solution that has been able to get a lot of traction quickly.

Andrew Silver:

I think that's all great, great feedback, great advice for the future entrepreneurs of our industry. Well, I think we got a pretty comprehensive understanding of your business and your story. Anything we left out, anything we should tackle or anything you want to talk about before we wrap reach out, sign up for fresh ice.

Clay Curran:

Yeah, it's great, great joining. Thanks for having me and and yeah, anyone's welcome to reach out, happy to show folks the platform or collaborate. If people think of other ideas, we can partner together.

Andrew Silver:

Yeah, I think you know I've had a lot of founders on here and this might be the youngest company I've had on at least one of them but I just love the problem you're trying to tackle. Anybody could go start another freight brokerage, like me. That's what I did. That's not as hard as actually addressing a real, tangible issue in the space like Reefer LTL. So kudos to you and the team. I hope you guys continue to build on the traction you're talking about and that you find a way to make a real impact here, because our industry needs the help. The reefer LTL problem has been one for a long time and you know I'm cheering for you guys, so cool.

Clay Curran:

Thank you.

Andrew Silver:

With that, see you all next week. Have a good one, alright.

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