Ep. #84: Robby Nathan, Founder & CEO, Envoy AI

“AI can negotiate freight rates” is one of those claims that sounds true until you sit on a real brokerage floor and watch what happens. I’m joined by Robby Nathan, founder of Load Delivered, CEO of Envoy AI, and a longtime freight operator, to break down what separates automation that actually helps from automation that just fires off templated emails and calls it intelligence. We start with the roots: how Robbie went from a philosophy degree to the carrier desk, why he chose temperature-controlled, high-value freight in the 2008 downturn, and what hyper specialization teaches you about SOPs, service, and building a carrier network that can handle high expectations. 

From there we get into the hard parts of scaling a freight brokerage: capital constraints, enterprise shippers that cap your volume, EDI setup delays, and the leadership shift that hits when the company outgrows your personal operating style. We also tackle the new risk reality after the Supreme Court negligent hiring environment, why inconsistent processes across pods or agents can create major liability, and why carrier vetting and documentation are becoming non-negotiable for brokers and 3PLs who want to stay in business. 

Then we go deep on logistics AI, adaptive rate negotiation, and the semantic layer needed to move from copilot to safe autopilot. Robby shares what he’s building with Envoy around carrier communication, verification filters, and a future where freight operators manage AI workers instead of living on the phone all day. If you care about freight tech, carrier compliance, TMS data quality, and the future of brokerage, this one will challenge how you think about “automation.” Subscribe, share with a teammate, and leave a review. What part of brokerage should never be manual again?

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Transcript

Sponsors And Why Cash Flow Matters

SPEAKER_01 0:02

Before we get started today, I want to give a quick shout out to our headline sponsor, Stute Technologies. Every week on this show, I talk to operators who are crushing it on the service side but still chasing down payments. That cash flow gap is brutal when you're trying to scale your business. That's why I wanted to tell you about Stute. Stut is the AI platform that does accounts receivable work instead of just assisting with it. Their CEO, Tarek, actually came from TQL, so he gets how logistics companies operate. I've known him for years and I truly trust what he's building. What Stute does is simple. Their AI actually collects your receivables for you, not some software that just helps you chase the payments. It literally does the work. It's up and running in days, not months. As an example, Bishop Lifting is using Stut for a 35% reduction in overdue invoices, millions more in working capital, and a reduction of manual work by 50%. If you're tired of your AR eating up time and cash, check out stute.ai. That's st-u-ut-ai. Tell them you heard about it on the freight pod. They'll get you collecting in days, not months, so you can focus on actually running your business. Now let's get this episode started.

Robbie’s Start And Early Freight Lessons

SPEAKER_01 1:29

I'm your host, Andrew Silver, joined today by Mr. Robbie Nathan, a experienced freight broker, founder, and uh a veteran of the game. Welcome to the show, sir. How are you? Great. Thanks for having me here. So um you started a business called Load Delivered, and it was a great success in the industry a little bit before my time, um, I think. Uh, well, before I got into Molo, at least, and uh did very well and eventually sold it. But that was not your first foray into the business, right?

SPEAKER_00 2:07

No, I started as a 22-year-old carrier rep. Uh, walked out of college with a philosophy degree, didn't know what I wanted to do, uh, traveled in China for about a year, and then I started out on a freight brokerage floor as a carrier rep. I was answering phones, I was making calls, I was dispatching trucks, and I was learning how to operate in TMS systems.

SPEAKER_01 2:31

So you spent four years studying philosophy and then started talking to truck drivers and booking loads.

SPEAKER_00 2:38

Absolutely. And it was actually uh a jarring moment. I remember uh when the the gentleman across from me said, you're not allowed to make outbound calls. You're only allowed to answer truck drivers and dispatch them and and and give them directions. And so I wasn't even allowed to do selling, I was just allowed to give directions. And when you think about that and and the world today, uh there shouldn't be uh dispatcher giving directions anymore. Uh and there maybe shouldn't even be an outbound, you know, individual making calls or receiving calls. Or if there should be, perhaps they should just be, you know, have a some sort of co-pilot alongside them. That's so funny because you just jogged my memory.

SPEAKER_01 3:26

I completely forgot, like, you know, when I started in 06, just those first couple years, I remember in Lodes, there was like a there was a spot in our TMS where you could upload directions to the facility. And we would actually spend time like on the phone with the driver explaining, all right, you're gonna turn left on this street and then go and turn right. Um just such a world of difference from where we are today, right?

SPEAKER_00 3:50

Uh absolutely. And uh actually one of the activities of a dispatcher was to document the directions and fill the TMS, TMS up with as many directions to the core facilities as you could. Uh so you think about the time allocation then and now what uh operators are able to do with their time.

SPEAKER_01 4:13

So was this like a love at first sight thing, or you were like, I'm just gonna do this until I find something better to do with my philosophy degree, or kind of talk to me through, talk me through like how you progressed in in your role and then eventually chose to kind of start your own business.

SPEAKER_00 4:28

So I'm sure many of us, uh afraid operators in the industry receive the same feeling. You stepped on the floor, you shadowed your first rep, and you just felt alive. You felt you were home. Right? You graduate college, you're trying to find where's your place. Uh, you know everyone when you walk into class, a bar or the library, and you know no one. But there was something common and some type of energy that just drew me to it. And uh I was hooked day one.

SPEAKER_01 5:00

And how long did you stay where what was the company you first worked at?

SPEAKER_00 5:03

So I was at AFN, uh, which actually was a breeding ground for a lot of tremendous uh operators, uh, people that are running some of the biggest companies uh in the industry today. Uh so it was a great place to meet people. And and how long before you decided to do your own thing? So I was there for exactly two and a half years. I absolutely loved it. I learned everything I could about booking loads as a carrier app. And so I really wanted to master how to be able to book, optimize my freight board. So uh I was one of the top reps in a very short time, then decided to build their intermodal group. Uh, we built one of the first uh intermodal departments within an over-the-road brokerage. I believed in the conversion of over-the-road freight to intermodal at that time, was really passionate about it. Uh, and then soon thereafter moved to the customer side. And I think, like many, once you've seen the carrier side, the customer side, it gives you the confidence uh to go out and operate on your own.

SPEAKER_01 6:04

So two and a half years. I mean, you started 22. So you're 24, 25 years old when you started Load Delivered?

SPEAKER_00 6:09

Uh I was 25. Uh, I had a tremendous uh co-founder, and he was actually my camp counselor when I was a seven-year-old kid. Uh, he was the one that that founded uh Load Delivered with me, gave us the first $750,000, and we were off to the races.

Starting Load Delivered In A Down Market

SPEAKER_00 6:26

And this was 2008, right? This was 2008. Bear Stearns had just gone down. There was everything was in sort of uh financial disarray. Uh the freight market was was highly depressed. Uh, but we were small and we had a very focused niche. We wanted to focus on temperature-controlled freight high value. And so this was before many of the brokerages were interested in moving temperature-controlled high value, both seafood, pharmaceuticals. Uh, and that's really where we started, uh, moving freight uh load by load, uh, just like how many uh of the top 100 brokerages started, uh started as well.

SPEAKER_01 7:07

What why did you choose to go after that specific type of freight?

SPEAKER_00 7:12

Hyper specialization. I always just saw that hyper specialization and that my 2.5 years at AFN, I saw that the best people had niches and they were really good at a specific area. Uh Andrew Haverkamp, who uh I know you spent some time with at Coyote, he was also uh a big mentor early on, and I saw he had a niche, hyper specialized in one specific area. Well, at that time in 2008, farm to table was starting to become big. The need for temperature controlled goods was expanding. And so I thought, let's go after a bigger TAM. There isn't as much competition. Uh, amazing operators like Paul Loeb, Jeff Silver were hyper-focused on dry freight at the time. And so I thought, why not skate where the puck puck uh skate somewhere else? Uh also, uh, in addition, is temperature control is hard. It is really challenging. And I wanted to focus on the hard stuff.

SPEAKER_01 8:12

Yeah, I I mean I certainly agree with that. Did you find that like it was more challenging than like what what kind of challenges did you run into developing a carrier network in such a specialized type of freight? I mean, if that wasn't really what AFN had been great at, or or you know, what you'd seen from other leaders, like how did you go about making sure you could actually support such high-touch, high-value business?

SPEAKER_00 8:42

So it the beautiful part is in logistics, it's the same principles for moving point A to point B. You just need to add specific SOP. So add the SOP of temp control checks, add the SOP of precooling, uh, a pre-cooling before you go into a frozen load. So it was basically taking my base knowledge that I learned at AFN and then expanding on that uh and doing it with customers that just required a lot. And when you service customers that have high expectations, it levels you up. Uh so I actually uh encourage companies early on in their trajectory, find the tough customers, find the difficult freight. Uh if you can work with them, you probably can work with anyone.

SPEAKER_01 9:26

And what would you say in the early years was the most challenging aspect of building the business?

SPEAKER_00 9:31

Uh everything is challenging, Andrew, as you know, right? Like there's the being able to uh not having enough capital to uh scale as quick as you want, uh, landing these large enterprise customers and then having to wait for uh EDI setups, uh being capped on uh people just not giving us enough freight because we weren't big enough. I remember there was a time in my career where every single customer, Fortune 500 I went to, I would see a green coyote, some paraphernalia on their desk, a cup, uh a mug. And I would look in their eyes, people that really liked me. Uh Jake Kildore uh from White Wave Foods was a great customer, and he said, Robbie, we're we're just not gonna give you more than X percent. Here's what we do we give CH Robinson X, we give Coyote Y, and then we split it up with the longer tail. And so my goal initially was like, get a piece, get in the game, stay around the hoop, and you and you'll get some some bigger rebounds as well.

SPEAKER_01 10:36

Yeah, I mean, it's such this the brokerage is such a game of relentless effort, and and if you just are willing to stay in the fight, good things happen. It's like the industry will throw a lot of chaos at you. Um, it might be a down market for you know three years, like the current brokers have dealt with. Um it could be ELDs, it could be the most recent, you know, Supreme Court decision, but like you know, it's so easy, and this is topical, it's so easy for social media and and and for you know all the freight influencers to to start talking about how the sky is falling. But like if you just really stay dialed in and focused on executing for your customers, good things happen. Like, that's it. You know, things change, you have to adapt to the changes that come, but like there will always be a place for someone to move freight from point A to point B because you know things gotta go from point A to point B and someone's gotta move them, right?

SPEAKER_00 11:42

And and it to your point, it's a game of execution. You execute every day for your car core customers. To your point, good things will happen. Um yeah, I totally totally agree. What was the hardest part? I mean, you grew, you know, talk about regulatory tailwinds, you were part of Coyote when the ELDs came out. Uh, you know, that was maybe a little before your time, 2014. COVID, all the regulatory sort of everything that was going on during COVID was part of your growth in Molo.

Scaling Leadership During COVID Growth

SPEAKER_00 12:10

Um, what was the hardest part when you were scaling or uh going from let's quit call it 50 to 250 million?

SPEAKER_01 12:20

Well, for I mean, 50 to 250 for us was was the COVID was like, well, we had 50, 17, 18. Okay, so that's like you're talking like 2019 and 2020 for us at Molo was when we were kind of going through that. I mean, COVID was such a challenging environment, just from uh, you know, what the heck is going on. We've got a team of like this is like truly, you know, the word unprecedented was said an unprecedented number of times during the first four months of COVID. Right? We were always just like, this is unprecedented, we don't know what the heck's going on. Um, but I think the hardest thing for me personally was probably the fact that when you're the CEO, everyone's just kind of looking to you for answers. Um and COVID was just not a time where we really had answers. Um the only answer I I could give my team at that time was to just keep our heads down and keep executing and and to really try to support each other as much as possible because of the once again unprecedented times that we were sitting in. Um so I think that was that was probably at least from the 50 to 250 the hardest. Um and what else was really hard? You know, I I think it's it's hard when I I don't know that I was ready to be the kind of CEO that could support the business that we were growing into. Like I think that I really enjoyed being out in front of customers, selling, understanding what it is that customers were looking for, and making sure that I brought that information back to our team and delivered it in mass to our team. Like that was really fun. And being out on the floor, walking the floor, just connecting with people, checking in on how they're doing, just telling them they're doing great. Like I used to just message all the managers and be like, Can you guys send me a few things about your team? Like who's doing really well right now, who just had a milestone? And I'd get, you know, this guy just booked uh 50 loads on this carrier for the first time, or this this guy just got his 10th customer. And I would just take that and I'd go up to the rep and and be like, dude, you're you're crushing it, or hey Sam, like you're doing great. You know, it's like that's so fun. Um, but that's how you can spend your time when you're at 50 million, at 100 million. When you get up to like 500 million, it's like things change. You can't really just keep focusing on those you know, cultural elements and sales efforts. It's like you you you have to start to deal with bigger issues that as a as a at the time 29-year-old who I didn't go to business school or anything like that, like I wasn't fully equipped to do. And I was really, really grateful to have just an excellent partner in Matt Bogrich, who you know did go to business school, but also just was way smarter than me and could handle a lot of the problems that I wasn't really able to. I don't know if like, you know, I I think having a team that compliments each other well is so important. Like when you think back to your own experience, what were the things that you were really good at and what were the things that you needed support from other people on?

SPEAKER_00 15:42

So I think that a really good CEO finds a really strong team that not just compliments them but levels them up. And so, like back when we first started, there was I believed in a flat organization. I believe in a flat organization for in freight brokerage until you get to about $100 million or semi-flat. Um, what I was really good at and what I was really passionate about was reading the market. Uh in fact, I was so passionate about it that I started Logistical Labs. I uh took my 401k money, went to Lithuania, and built a freight tech 25 company

Algorithmic Pricing And Real Negotiation Signals

SPEAKER_00 16:20

specifically to figure out pricing, how to price customers digitally, machine-to-machine communication. Uh, that's what I was really good at, figuring out how to compete with the big companies. I saw what uh Echo was doing, I saw what Coyote was doing, and I tried to figure out how we could, how could we attract similar customers, provide better service, but in a very small, more boutique fashion. Uh so that's what I was good at. What I wasn't great at uh was that consistent management is uh the consistent reviews, the management, the uh the the Monday morning huddles. Uh that wasn't uh as you know, I had to really work at that over my career. Was fortunate to have tremendous mentors from publicly traded companies that mentored me uh and leveled me up. So uh yeah.

SPEAKER_01 17:13

That's so interesting. Uh you know, I'd forgotten about the logistical labs piece. What what was the like it does that is that similar to kind of what API pricing became to an extent? I mean, you're talking machine to machine.

SPEAKER_00 17:26

Absolutely. We were the one of the first companies to do this. It started with I saw I I couldn't compete with the top, I couldn't compete with CH Robinson, TQL, Coyote, uh, Echo. They were doing algorithmic pricing. It was the early stages in 2012, 2013. And I couldn't figure out how to price on a mass scale. And I wanted to democratize it to any brokerage under a billion dollars who didn't know how to price uh in an automated fashion with machines. And so it was really the beginning, and there's been some great second generation companies that have spawned off that that are now integrated, whether it's AVRL or Tabby Connect or some other rating engines, which are great. Um, but I think there's a massive next step that we're gonna see. Uh, I've that's one of the reasons I got back into the game. There's adaptive rate negotiation, which no one is really doing or thinking about. People are claiming that AI negotiates. AI does not negotiate. But there is an opportunity. Explain, explain. So AI is just looking at math. You can you know give it parameters, and based on those parameters, it will negotiate. But it's not actually negotiating within the tradecraft that you and I know. And by the tradecraft, the signals that you and I on the carrier floor saw and heard. And that is what I'm so interested in about is the ontology of why and how decisions are made on pricing and procurement in North American logistics. And that is sort of what I wake up and spend time on every day.

SPEAKER_01 19:09

Okay, let's take a quick time out and give a shout-out to one of our sponsors, 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, which 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 Icaza, 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 in 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 Rappido are a great place to start. To learn more, check them out at gorapido.com. That's gorapido.com. Now, let's get back to the show. So help help me understand if this is if my tell me if if I'm thinking about this the right way. The way AI is doing it today is, and I saw this, I told you, and I don't want to say who, but I I got to sit in a brokerage yesterday and see it was the first time I've been inside a brokerage in three years. And man, was I excited to be there. I was just really digesting and seeing what it was like, but I got to see people working live. And I haven't seen any of these tools live. I've been out of the game for three years. So all of these AI tools, none of them existed three years ago. And so I'm sitting there and I'm watching someone in parade, and uh I'm uh they were showing me how their, I don't remember who their AI tool was that was doing the negotiation, the negotiating. I should put air quotes on that. But it, you know, it was an email, you know, the load had been posted on DAT, and and that's where the carrier saw it. They responded or they sent a quote in. I think it comes through parade, and then there was an email back from AI, whatever, to negotiate. And it just said, can you come down $100 or something? That's a parameter set. It's saying whatever to correct me if I'm wrong, but whatever the rate is that the carrier comes in on, the first thing you do is ask it if it can come down $100. That's not negotiating, right? That's that's it's set a parameter. But what you and I are taught, or what you're explaining, I believe, is when I have a load, whatever, and and some maybe it's posted, and someone calls in, it's a Chicago to Dallas load, and this guy calls me, and I can see it's a Dallas phone number. I know he's based in Dallas. I see, I look him up on his MC number. This carrier is based in Dallas. And this guy's like, hey man, like you still have that load. And I can feel it. I can sense that he needs this load. He's like, I need to get, I can tell he needs to get home. And it doesn't mean I want to screw him over or anything, but it just means, you know, he's like, hey, you have it posted for 2000. Can you do 2400? And I'm like, you know, in some cases, if I didn't pick up on these signs, I would have said maybe I can meet him halfway. But I'm like, no, I got to be at 2,000. Why? It's not a gut feeling. I'm I'm picking up on signals that he's giving me that tells me this guy needs this load. So like I think my market rate's 2000. That's fair. I'm gonna hold on that rate. That's negotiating, right?

SPEAKER_00 22:39

That is exactly why I got back in the game. I saw how people, these V1 AI platforms, were claiming negotiation. And it I needed to investigate. It was bothering me. It's just all my friends had brought me in, similar to you, to look at the technology and uh and they were doing awesome. Uh, I think the the V1 AI players are doing great things. So uh kudos to them for leveling up the industry. But I just didn't feel like it was gonna be enough, and that real domain experts needed to come in and take the tradecraft signals like you just suggested and systematize them. And it's gonna take time. This doesn't happen overnight, but those signals, and then how do you dynamically adjust it so that everyone is a boss on the floor? So essentially, if if I'm in control of a hundred loads and I decide I want to post 30% of them, actually, the you know, to different load boards, you can dynamically train how you want those answered. Do you how you want them priced and to negotiate versus the standard $100, then back and forth? The carriers game that. I saw it and they were gaming it really quickly. And so I just think it's important to figure out different adaptive ways to negotiate on the carrier side, the same way that hundreds of millions of dollars have been spent on how to automate price on the customer side.

SPEAKER_01 24:09

And you think that it is possible for the technology to learn kind of those human signals and adaptively negotiate or respond? Like that's you you think we can get there?

SPEAKER_00 24:23

We will get there. It's gonna take time. And most companies have not built the semantic layer. The semantic layer is that layer, right? We all were told in 2015, big data, start collecting it. But we didn't know why we were gonna collect it. Well, we were collecting it for for today, to be able to take action on that data. And uh the only way to be able to take action on that data, one, it needs to be clean, two, you need to be able to understand it, whether that's a domain-specific language, understand loads, or understand what's going on uh with that communication channel. But yeah, I I just what I've seen, uh sorry, I'm I'm getting excited here as you can tell. That's good. You know, we uh we just spend a lot of time in our laboratory. I've spent a year now digitizing my my the name of the company's envoy, but initially it was Freight Mind. And we've spent a year really digitizing the thoughts of a freight broker, of a carrier up, and that trade craft that goes on. Uh, and we're we're not there yet, Andrew. But we're having these little moments, these little nuggets where we're winning. And uh that's that's what I signed up for, and uh that's what I'm pretty pretty excited about. Um, the question I think that we need to ask is logistics experts is what do our human operators do? Are they bosses of the machines or are the machines sort of copilots? Are we getting to autopilot? And I think that's where this industry is sort of stuck currently. Uh everyone wants auto, everyone wants autopilot, but we're in this copilot phase.

SPEAKER_01 26:12

Autopilot's scary, right? Because you have to be so confident in your data and your SOPs to know, and then eventually the technology to know that A plus B will equal C. Like you need to make sure that one, your data is all set up structurally, it's it's it's effectively accurate. Um and two, that your SOPs are written in a way that the technology can digest and then execute on them. But like there's not a lot of wiggle room to screw around, you know. It's like we had a mistake once, and I don't remember this is uh this is from years ago, and this was not a this was not a AI issue, this was a person issue, but it's just a great example where like someone didn't understand something and it cost us a lot of money. It was uh there was a load moving from Wisconsin to Florida, it was a load of butter, and a carrier called in in Tennessee and they called in at night. Um, and an after hours person working not in the States was um just supposed to be tracking loads, and you know, they didn't pick up on the fact that this refrigerated load of butter, you know, the the guy called in and said his reefer wasn't working. Um and this person said it's fine, it doesn't just just keep going, make your delivery, and just didn't understand the SP effectively. And and and what that did was cost us a ton of money. But that's a person issue, right? If you don't have the right information in the system, once you do let the AI run on autopilot, it's gonna miss the same things.

SPEAKER_00 27:49

So let's talk about the semantic layer. If the semantic layer is trained and understands if every time I see butter load, then we need reefer, and then it needs to be coded at negative 12 degrees, let's say. A human can't override that. So if the manager up here sets his parameters and lets autopilot run, you could argue that autopilot in the future would run better than that BPO individual that made the mistake and sent the driver in. And so I think it's about if you have the right permissions and the right data, those types of instances shouldn't happen. And it's about controls. And and so, yeah, like I that's where I'm so interested about, you know, modern day TMSs versus future TMSs and permissions and what they look like, and then these systems of record versus systems of action, that's how they interact, right? There's a reason why very well-funded AI companies are interested in partnering and/or merging with well-funded TMS companies because they're gonna have to coexist in the future. Like the data has to connect. And currently, uh it does not in our ecosystem.

SPEAKER_01 29:09

It's a context issue, right? Like if the the AI company can't do much if they don't have the context that the TMS has, right?

SPEAKER_00 29:20

And even one step further, if the broker or the LSP or the shipper is not using the system correctly, so they don't have a suggested base price or a floor price, then AI, your platform has nothing to negotiate on or verify. If you don't verify that you need a carrier with XYZ uh equipment, been in business for uh this number of long, this type of driver, then if you're not putting the data in the TMS, then the system of action uh isn't going to be able to operate correctly. What we've noticed

Semantic Layer And Autopilot Guardrails

SPEAKER_00 29:55

is a lot of companies are not putting in or using their system of record correctly.

SPEAKER_01 30:02

You know, it brings up an interesting thought for me because I feel like there's a path that brokerage ownership realizes for scale, that is, and it's not it's not true of every brokerage, but a lot of brokerages realize that their best path to growth and scale is to give more autonomy to the reps, is to let reps build their own business within the business, whether it's an agent model where you hire someone and you say, here, you do literally run your own business and you can keep 70% or 60% of the gross margin, and we'll just do your back office and infrastructure. Or it's the pod model where you know, inside of a even like a Chicago or or uh a traditional broker where you're just saying, Hey, um, you build the pod, Rob, like Robbie, I'm hiring you. You go hire people, work under you, you teach them what to do, and you know, when you get from 10 loads a day to 20 loads a day, go hire another guy and bring him in. And like that's more like I feel like that's more like the southern model. I think Access America, who Coyote Acquired had that model, the pod model. Um, there are other companies in Chattanooga that do too. And my point in bringing this up is it's a faster way to grow in some cases because you know, people want autonomy and and want to feel entrepreneurial and they kind of control their own destiny. But in today's environment where two things are converging, one is the rise of AI tools, which um, to be effective, require uh almost like a symphony level of orchestration where everyone's on the same page doing things the right way, the SOPs are clearly defined, and from pod to pod, you're seeing the same SOPs follow. Because you can't put it plug an AI tool into pod one, who doesn't write anything on the Raycons because they just are moving fast and loose and want to get loads covered. And then pod two, who is super neurotic, doesn't move as much freight, but their Raycons have 4,000 lines of writing about, you know, must be a tenure or newer trailer, driver must speak English, must have closed toed shoes, you know, things like that. Like the AI doesn't work in that function. And the second thing converging is the recent Supreme Court decision, which is saying now that brokerages can be held liable if uh they are proven to be negligent in how they selected a quality carrier. And if you give so much autonomy to reps to just pick whatever carriers they want, that's a recipe for a nuclear verdict that will put brokers out of business. So I'm curious like what how you think about kind of what I just talked about in terms of like that environment we're in.

SPEAKER_00 32:51

So I think the environment we're in is going to is the perfect opportunity for a blend of technology systems and human operators. For instance, verification. How do we verify carriers? How do we store data? How do we make sure that if we do get called to court in a year because you know there was a wrongful death, how do we make sure that we check the boxes? And I think it has to be a combination with systems and uh and humans. I think that's what it'll come down to. But you have to have the right system. So, for instance, when we're hearing we're getting a thousand calls inbound into one of our brokerages we're working with, we're filtering 800 of those calls that are actually good carriers that are compliant. Of those 800, we might be filtering down another 50 that are viable for them in their network. And then there's the the people can go and operate and book shipments. And so I would say that's just a way to filter the good so that human operators can execute faster. Um, that that would be one area where I'm seeing a lot of opportunity of better industry, better cost to serve, a little safer. The challenge is the small brokerages, can they afford it? And are the bigger brokerages going to look like clearing houses in the future? Meaning lower margin, but these big, massive, well, there'll be maybe a hundred of them, maybe 200 uh versus 25,000. Uh, I don't know if that happens uh you know now or 10 years from now, but it does seem like there will be a contraction. Um, I don't again, I don't know the acceleration in the number.

SPEAKER_01 34:39

I'm hoping there's not and I think there's a path for there not to be, but I'm I'm you know, who knows?

SPEAKER_00 34:45

I mean it's it's you had a great question as what about the agents? The agent model you mentioned I saw on a post is what about the agents operating on someone else's authority, making these independent decisions, as you know, you just mentioned right now. And what happens to those companies who have three customers, 12 loads a day, are they still going to be able to run as an agent?

SPEAKER_01 35:08

Yeah, it it's interesting. I I do think that the right agent system can work. Because I think if if if a company that has an agency, because a lot of the times it's not just an agency, sometimes it's a W-2 brokerage that has an agency. Armstrong is a great example of that, where they have their own brokerage, but they also have an agency. And I think that if the if the agency is structured in a way where, yes, an agent, if if Robbie Nathan is the agent and he has Robbie Nathan logistics, which is actually part of Landstar or Armstrong or anyone, you know, Tallgrass, whoever it may be, um if if the if the ownership of the agency, I'm sorry, if if the if the overarching business requires strict quality carrier betting, and you can't just pick whoever you want, I think it can work. If they give you full autonomy, like, hey, it's your business, you pick the carriers, that's gonna be a problem. I think I think those are the guys that are gonna cut corners. It's it it's natural. Um they're not gonna be on the hook for the 20, 30 million dollars if there's a nuclear verdict. Why? Because they'll just shut down their business and start over. I mean, you're gonna see that the there is gonna be a group of chameleon brokers, I believe, that show up. I I just and what I mean by a chameleon broker, for those that haven't turned that term before, it it's it's it's been a common term about chameleon carriers, where you know, a carrier might start up and run a few trucks and then they get in an accident, they get some bad scores, and what do they do? They just shut down operation and open a new MC number a week later. Um, I really think that is the strategy that some small brokers are going to take. I don't think it's smart at all, uh, but I think it's gonna be uh uh basically like a prayer. Like they're just gonna run and hope that they don't get a bad accident, and if they do, they're just gonna fold up shop and try to start over. It's not a it's not a good thing. And I do think that this kind of change will really drive separation between companies that do things well and companies that don't. And I think it's gonna be more incumbent on shippers to go deeper into their own due diligence to understand what are the operating procedures that your company

Supreme Court Risk And Carrier Vetting

SPEAKER_01 37:40

utilizes to execute my business. And most specifically, what I'm interested in is what does your insurance look like and what is your carrier betting look like? Like who's allowed to make decisions on what carriers you use and which carriers are you allowing your company to use? I think that's I think that's that's gotta be where where things go when when you know when you call your next when when when I'm a broker again and I call a shipper trying to haul for them, those have got to be two of the first questions they ask.

SPEAKER_00 38:10

I think you're gonna see a third question from Fortune 500 shippers. What is your balance sheet? How big is your ABL line? Are you on an ABL line? I think shippers are starting to understand the risk of working with brokers also that have these big ABL lines with not a lot of strategic backup financially, you know, highly levered companies out there, whether it was through private equity or uh through their own personal vehicles. I think that shippers are going to be very careful about who they partner with and you know their partners' balance sheets.

SPEAKER_01 38:48

I think they should. I mean, there's really no reason not to. And maybe that is what drives consolidation. You know, I I still think the long tail seems like it'll exist. Because, you know, do you really think that like Joe's paper, who moves four or five loads a week, maybe it's four or five loads a month? Do you think they're gonna be that invested in this kind of due diligence? Or do you think they're gonna maybe operate the same way some of the small brokers do? Which is like, hey, I need the cheapest truck. So like if you can get that for me, hook it up.

SPEAKER_00 39:25

I I think you're exactly right. There'll be this sort of secondary market of long tail shippers, brokers, carriers that all operate in this ecosystem, uh, sort of with a hope strategy versus a really strong verification strategy.

SPEAKER_01 39:41

Um I saw two things just this morning um on Twitter. One of them was a guy who's the CEO of a small trucking company. And I think someone had asked, like, how high are rates gonna be this week? And he was like, for reefer, we're charging seven to nine dollars a mile. And on top of that, we're a conditional carrier and our phone won't stop ringing. That to me is insane. There are brokers who still today are saying, I'm gonna still use this conditional carrier because I gotta move my load. Like that is it's a death sentence.

SPEAKER_00 40:20

If that if that trucker gets into Yeah, Chicago Brokerage 101, we were taught you never load a conditional carrier.

SPEAKER_01 40:28

At most conditional carriers 10 years ago. How are you loading conditional carriers the week after Supreme Court decides that you can be liable for negligently hiring? That's not even negligent, that's intentional. Maybe I'm pushing it with intentional, but in any case, that's it's it's bad.

SPEAKER_00 40:45

Um and you know that these accidents happen. Good companies with good compliant carriers accidents happen. And so working with a conditional carrier just exacerbates that problem. And yeah, it's it's wild that you know in 20, I think it was 2007, we stopped using conditional carriers. Uh yeah.

SPEAKER_01 41:06

Holy That is what everyone says when they see Gen Log's truck intelligence platform for the first time, founded by XCAA operatives and fueled by 15 million daily images across a nationwide camera network. Genlogs gives you the power of total market capacity while also defending you against fraudulent carriers. Holy sh is what Genlog's customers say again when they see the ROI from covering loads faster with fatter margins. Holy shippers! That's right. Genlogs unveils the locations and lanes for all the shippers in America. In the era of artificial intelligence, nothing beats actual intelligence from verified by video data. See what Genlogs can do for you. Check out a demo at Genlogs.io. Again, that is G-E-N-L-O-G-S.io. Tell them Andrew sent you, and they'll include their carrier compliance suite for free. And if you haven't already, I interviewed their founder, Ryan Joyce, last year, and it's one of my personal favorite episodes that we've done. Check it out. Now, let's get back to the show. I mean, it it makes the industry, it makes brokerage as an industry look bad. And it really frustrates me because I I don't love seeing the hate that brokers get because I know guys like you and I, and and hundreds or thousands of people that you and I know worked our absolute butts off to take care of every company and every partner in our ecosystem, whether that was our employees, our drivers, the dispatchers, or the shippers themselves. Like, I know that's how you ran your business, it's how I ran my business. We wanted to do good. And why did we want to do good? Because we'd seen enough of what doing bad looks like. We knew what the reputation of brokers was in the industry, and we wanted to elevate that. We wanted to raise the bar. And a lot of us did. You did, I did, a lot of our peers did, Pyatt did. Like, it's just there's a there's a long list of people who have worked really hard to try to like raise the bar for brokerage. Um, but all it takes is like all I have to do is see one post like that, and it's just like someone is making the rest of us look bad. And why that really concerns me is everyone's talking about how we're gonna get to these nuclear verdicts, and these cases are gonna happen. It's unfortunate. I think I saw a stat that there's like 5,700 a year of these like terrible accidents where someone unfortunately passes away and a truck is involved. Doesn't mean it's the trucker's fault. But what we're finding is once it gets to a court and once it gets in front of a jury and it's between it's a grieving family or a company that's got money on their balance sheet, and they're just saying, I don't care. Take the money from the company that has money on their balance sheet. Sheet and give it to the grieving family. And it's, you know, it's it's a sad situation. But you know, there was an there was an accident recently where someone was driving down a highway and they crossed over the median. They were in the wrong. They crossed over the median and hit a truck and they died. And it's terrible, it's awful, but the trucker was not at fault. If you cross over the median and hit a truck, that's not that's not the trucker's fault. And the trucking company was was on the hook for over $50 million or something like that. It's like that kind of stuff to me is it's just wrong.

SPEAKER_00 44:38

Um, and and more importantly, so it's wrong. And the sad part is the people, the consumers, the American consumers at the end of the day are paying more money at the store because it costs more money to move freight from point A to point B because of all these challenges. And so, like, how do we improve the industry so that the inflation at the store isn't caused by logistics inflation, too? Right. When we think about that, is so every time logistics rates go up, you know, freight brokerages and three PLs are clapping, but you know, the mother, a single mother of three trying to buy milk uh has to spend 10 cents more a gallon. That's not fair. And so part of this is also this isn't just about the freight ecosystem, it's also about American families and how we do we make the logistics ecosystem better and safer and also not impact the cost of goods as much.

SPEAKER_01 45:36

Yeah, I mean, it's it's tough because like it feels like there's always got to be a loser. Like there's always someone who's gotta come out ahead and someone who's coming out behind. And you know, I guess it's about perspective. You know, it's like someone looks at brokerage and thinks, oh, those guys are just stealing the dollars in the middle, and that's hurting the single mother of three. And it's like, no, you know, good luck, Coca-Cola moving all your loads without a broker. Like there won't be milk on the shelves, you know. Like it just, it's it's I don't know. I I think it's um I think it's a lot more challenging and and complex than people give it give credit. And um it's frustrating, but um Yeah.

SPEAKER_00 46:21

What

Defining Safe Carriers And Fair Pricing

SPEAKER_00 46:22

do you what do you think about rates and regulating rates or deregulating rates or uh you know free market economy, right? So in 1980 they they deregulated it. Are we going towards this future, if you know, of more regulation? Or how do you think about pricing?

SPEAKER_01 46:39

Yeah, I I don't think that regulated pricing makes sense. Um I don't know that there are a ton of examples where that has been a lucrative or um successful endeavor, but um I'm also not an expert on that. Uh I will say um I I want more regulation around, I just want more understanding from the government and support from the government so that we can do our jobs. You know, if the Supreme Court's gonna tell us that we should hire a safe carrier, and if we hire, like I saw Brett Kavanaugh in his in his opinion, you know, on the Supreme Court case, wrote like if a broker does their job hiring a safe carrier, they should be able to defend themselves successfully in court. Great, thank you. I appreciate that. Now, Brett, what does it mean to be a safe carrier? Someone tell me, right? If the FMCSA won't rate nine, if 94% of the carriers in the market are unrated, how the heck do I know what safe is? I decide that because if I decide it, does that matter when we get to court? I'm pretty sure it doesn't. If I tell you I thought they were safe and you tell me no because of XYZ, well, you didn't define safe for me, right? And so it's like that's what I don't appreciate is if you're gonna regulate something to the extent that you're gonna tell us you you can be you can be sued for $25 million if if your carrier crashes, okay, I'll take that risk. But define the rules for me. This was like one of the biggest things for me, specifically with my employees, about how we operated for customers. I said, it's never, it's never our job to set the rules. The customer sets the rules. It's our job to agree to play by the rules. That's what a brokerage is. Is a is is a set of games that you're playing with rules set by customers who pay you money if you play by those rules effectively. That's it. They tell you to be at 95% on time and accept 98% of your primary tenders, and you win the game.

SPEAKER_00 48:51

So I have a question. To win the game in today's market, do you need to be somewhat of a predatory broker in certain markets? Define predatory broker. A predatory broker, let's call it a high arbitrage broker. Or is that the definition of brokerage? Being predatory and going for high arbitrage opportunities.

SPEAKER_01 49:17

No, I I don't think so. I I think that there's a path to being successful because you can do a good job of supporting volatility for shippers. I think there's a path to being able to provide fair market rates, you know, adding 12 to 15% on top of spot rates that you're making. Like let a shipper give 60-70% of their contract rate to their assets. And the 30 to 40% that slip through the cracks because the assets don't have the trucks on the days they need to, or they don't have the volume of trucks on the days they need to. There's a need. There's a there's a need for a service to support that, and it's fair to get paid to execute on that. Now, like I think taking advantage of carriers and trying to book under, you know, 25% under market is is is predatory. I don't, you know, I don't I don't love that. You know, I I never really loved how much emphasis there is on buying undermarket. You know, it's like shippers are like, we want to be 10% under market. And it's like, okay, you're kind of setting all of us up to be predatory here. Like you're telling me I have to to for me to operate, I if you if you want to be 10% under market, I got to find carriers that are 15 to 20% undermarket. And I promise you, those ones aren't the safest, highest quality carriers because the safest, highest quality carriers are getting paid good money. I don't know. What are your thoughts there?

SPEAKER_00 50:54

Yeah, I mean, I think that I definitely don't believe in regulation. I believe in free market economy. Uh, you know, and I think that's part of the the beauty of freight brokerage and about the United States of America. That said, we have to make sure the drivers in the trucking community are compensated fairly for their time. We have to. We have to do better. Um, to your point. The toughest time in my career was when my payments went from 30 days to 37. There was a period of time we grew too fast. I didn't have enough capital to pay in, I was a 27-day payer for so long. And I just I couldn't pay them in under 30. And I just don't know if that type of ethos is still operating in our industry versus people sort of just calling up their rapid triumph for someone and saying, can I inch up a little bit? Like, what's the market at? Can we start paying in 49 days? Or, you know, I'm starting to see that sort of discussion going on between broker, uh, third-party payments. I don't love that. Um, and so I think we need to be careful about how we pay carriers and why we pay them. For instance, why is no one pay upon pickup or pay in progress? Why do drivers have to wait till they get, you know, to the delivery to get paid? These are hardworking individuals that are literally going paycheck job to job, and we are making them wait till they get to the end for approof of delivery. It just seems like we need to change how we think about operating with drivers and communicating with them and paying them.

SPEAKER_01 52:34

I mean, uh you might you might be one step past me on that one. I like I don't know that paying someone before they finish the job. I can see, I can see paying. I mean, you know, the whole fuel advance concept, which whether or not people are using it for fuel or not, but you can get 40% of the load or whatever. At least we had it set up as I think 40%, where you could get paid 40% before. Um but I listen, man, it's it's it's a tight business. You know, the margins are not fat, despite what all the truckers on Twitter think. Like brokers are not making 70% margins.

SPEAKER_00 53:11

4%, 4%, 4% net Ibita. That is good. That is a good brokerage. And when you think about it, a billion dollars to make $40 million on a billion dollars in flow through and all the work and the loads and the late nights and early mornings, it's wild. And now, sure, AI can help and and and you know, you can have a little easier time operating, but four percent margins. And as soon as the cost to serve goes down, the shippers will know that and they're gonna ask for lower rates. So operational leverage for LSPs will equate to shippers dropping rates. And so I think that'll be interesting to like sure. If the cost to serve really is that low, will it go to the LSP or the shipper?

SPEAKER_01 54:02

Yeah, I mean, I I'd like to think it's spread. You know, I'd like to think that the that that each party gets gets a bit of the savings there, but um I guess we'll see. I mean, I I do think that like one of the things that I appreciate about our industry is brokers are nimble and resilient as as anyone, and we find a way. Like it's it's what what's what's ingrained in us from day one. Most comp like most people leave a brokerage, and then I need to ask you about this because you did this to an extent. Um you semi-retired for a few years, but most people, if they leave a brokerage job and go work at like a software company trying to sell software, there's almost like this existential crisis where it's like, I don't really understand what I'm supposed to be doing with my time. Like you go to the normal, you go to a normal eight to five, and people are just kind of like doing stuff kind of casually, not casually, but just it's the alarms aren't going off all day. You know, it's like the phones aren't blasting, you're not, you don't have fires to put out every four seconds, you're not multitasking all day. But that's what we're that's what's that's what we're bred into in brokerage. And so it's like that it hardens us. It it teaches us that like we're we're like almost dumb enough to think there's no obstacle we can't overcome because we spent a decade every day overcoming obstacles.

SPEAKER_00 55:36

And that's why I got back in the game. We have to change that. This next generation of operators, Andrew, they can't be on their computers and keyboards like this in desks for 12 hours a day. It's just not going to work in this next generation. And I think they deserve better. Uh, I they shouldn't have to sit inside

Envoy And The Future Freight Operator

SPEAKER_00 55:55

in a dark room for 12 hours a day, you know, gaining weight and looking at a screen like this, dealing with problems. We need to give them better resources, better tools, better copilots, certain tasks they should never do again because it should be on autopilot. And so, yes, every freight broker should be a boss in the future, and they should be managing a network of AI workers below them so that they're not doing this constant, I'll call it like the cortisol shock increase, right? You're just you constantly have high cortisol. And we need to do better. We we have to build better for that for the for the future freight brokers and logistics professionals.

SPEAKER_01 56:36

Is that Envoy's like calling card? Like, try Envoy, reducing cortisol in freight brokers everywhere.

SPEAKER_00 56:43

Uh I love that, but it's really about first carrier communication. So let's get into Envoy. I want to know exactly what communicate. So it I spent five years, I didn't go into freight brokerage. I walked back on the floor, and what I was most amazed at the different modes of communication that the carrier reps were communicating with their carriers. And by modes, I mean Telegram, signal, WhatsApp, SMS, call, email. When I got in the business, it was, you know, maybe some so it was call, email, maybe some uh instant messenger, but that was it. And so the future, similar to B2C, like we need to bring all those modes of communication into one platform, one channel. And it that's how we start to build this carrier context graft. And that carrier context graph is the beginning of the how and why carriers get booked and we rate a uh a load a specific manner. Um, but I I got back in because we have to not just help with copilots for carrier apps, we have to make their lives better. And part of that is I think we have a verification system. So, how many times did a carrier call in and you check their MC, looked if they were valid? I must, I probably have a day of my life was wasted on verification checks. With our platform, there's no verifications anymore. It comes into the system, and you, if you're talking or emailing to that person, then you're doing so because it was already filtered through uh whether it was highway, my carrier packets, gen logs, you know, we believe in BYOC, bring your own compliance, and we'll we'll figure out uh the verification channel. Um, so so part of it was was verification, part of it is booking, part of it is understanding the why and how we book. But the future is there will not be carrier reps. And if there are, they're gonna be freight operators. The the the what carrier reps started with American Baccaulers, Paul Oak, Jeff Silver, it's not gonna look like that in 2030. There's gonna be freight operators that will have teams of AI workers below them that will be helping them book freight, schedule loads, pay carriers, etc. Uh I I just I believe in it.

SPEAKER_01 59:02

So I I think I think just to clarify, when you say there won't be carrier reps, what you really mean is there won't be carrier reps performing the function that they're fun performing today, which is show up, bang the phones, make 12 calls an hour, minimum, 100 calls a day on the phone with carriers, booking loads, tracking loads, communicating, like whatever requirements, stuff like that.

SPEAKER_00 59:29

They will it will look different. Andrew, though the best carrier apps have the best memories. I mean, you know that. They're almost like supplant-like.

SPEAKER_01 59:36

Yeah, I remember that. Right? My desk was just a series of of yellow sticky notes with MC numbers written on it and lanes, and like it'd be like I'd see a load come up, and I'd like, wait, I remember that one, and like you start digging, like, oh yeah, this guy, call that guy back. You know, that was such a that was 2008. So but I get what you're saying. Like it is, you see a load, and you're like, wait, remember? Okay, who was it? It was this guy, I gotta call that guy back. He told me he likes that lane. Hold up. Wait a minute. Let's give a quick shout out to our sponsor, cloneops.ai. Logistics moves fast. There are calls to make, updates to send, documents to track. Your customers are always waiting. Cloneops.ai helps teams stay ahead with a platform that can be white labeled and a marketplace of AI agents built for real logistics operations. Inside the Clone Ops marketplace, you'll find agents for tracking, documents, after hour support, finance workflow, fraud prevention, and more. These agents plug into your workflows and existing systems to handle the repetitive tasks, whether it's making calls, sending emails, replying to texts, gathering info, or writing updates. Your team stays in control with real-time visibility into every interaction. And because the AI is always turned on, operations keeps moving even when your team can't. A standout is carrier screening plus voice ID, which ties a voice to a DOT number and alerts your team when that same voice appears across different or multiple DOT numbers, helping catch fraudsters before they cause damage. No one else has this. And for companies building a long-term AI strategy, cloneops.ai gives you the ability to white label, build, own, and control every AI use case across your business. And this team is run by David Bell, founder and leader who I've known for years, a good friend of mine, and someone who, frankly, anything he touches in this industry turns to gold. I trust him with what he's building here. If you're ready for automation that supports your people, visit cloneops.ai. Now let's get back to the show.

SPEAKER_00 1:01:36

And I just think there's a way to systematize that, you know, as technology grows. Um I mean do you do can you name the rep that was the best rep and coyote today that just was amazing at booking? And my question is who was it and why?

SPEAKER_01 1:02:00

Who was the best rep and coyote? I have to give credit to James Anstey. He was the first guy to ever book a thousand loads in a month. And this was before people were booking a thousand loads. I mean, this was this was 2000 and I was not done with college yet, so it had to be before 2012. I think I was still in attorney. It was probably like 2008 or 2009. Um why was he the best? Um I mean, he was relentless and so dialed in to his carriers. And he really, he had a lot of control. I mean, he he just you know, it felt when he was talking to his carriers about loads, it wasn't like uh, do you want this? It was like, I know what lanes you need, I'm sending you the loads you need. You know? Um I think he was taking a lot of Adderall, so he was he was uh he was he was very high energy um and and and chained to his desk for 12 hours a day, just absolutely grinding. But he he he understood his carriers better than anyone and and he fought for them. And I think that was a big thing that I used to try to to instill in my own work, because I learned a lot from this guy, um, which was like my job as a carrier rap was to work for you, the carrier. And so, in doing so, like I was the only one who could fight on your behalf when issues were going on. Otherwise, like I was fighting against you. A lot of brokers, it's like there's an issue on a load, the carrier is trying to get something, and it's carrier-verse broker, and it's like they're fighting each other. My thought was like, I'm gonna fight internally against my own team on behalf of my carrier, and they'll appreciate that and want to do more business for me.

SPEAKER_00 1:03:49

I I love that strategy, and that was always that was how I tried to operate. I actually took that strategy, and when I became a CEO, the same way that I worked for my carriers, I worked for my people. And I do think that that training early on as a carrier rep is really special because you start to understand that taking care of people and taking care of the people that take care of you is the most important sort of golden rule of building a business. Yeah.

Building AI With Domain Expertise

SPEAKER_01 1:04:21

Is it is it harder to build a AI tech business than it was to build a freight broker?

SPEAKER_00 1:04:27

Absolutely. This has been the most challenging year of my life uh and also the most rewarding and inspiring at the same time. Uh you know, I think that's part of what entrepreneurs do. We we jump into challenging problems and we just want to solve them. Um, but it it didn't happen as fast enough. Uh finding the right problem to solve didn't happen fast enough. There was a lot of noise in the industry. Um, so it took time. Uh, but once you start to feel momentum um and you start to see you start to see AI work, you start to see people smile. I mean, my best moment in freight was not selling a business. Selling a business is actually a sad local moment. It's terrible. Terrible. Uh what was an amazing thing about is Werner uh being on your that shirt you have, being on the floor at Werner and seeing a three billion dollar company use logistical labs technology alongside AS400 old school, and they're and now they're used, they were using this pricing and modal optimization, that was rewarding. It was a problem that we could solve for for a big company. And I'm sure, you know, mastery, your dad didn't need to build mastery, but he wanted to build mastery because he saw a problem and he knew he was one of the probably the best person in North America to solve it. And when we think about AI and freight brokerage and LSPs, I do think I'm one of the best people in North America to be solving specifically the carrier communication problem. And I Opportunity.

SPEAKER_01 1:06:01

Yeah, it's interesting because, you know, if I if I look at the companies that you're competing with, um the the people sitting at the top of the the ladder, the food chain within those companies have not sat in the seat that you've sat in. They don't have the experiential context of having lived what it's like to deal with carriers. And and I think that that's a miss. But I do think you are well positioned just because you have a level of experience. You you've gone, you've already gone deep enough to understand how this problem works and and what it is that the other side being your customer is looking for. Um and I think that that's something some of the super smart, listen, I'm gonna be honest. I think some of the AI CEOs who are 10 years younger than me and maybe 15 years younger than you, I have to be honest, I think they might be a little smarter than us, uh, just in IQ, but I don't think their freight IQ is as high as ours. And I hope you didn't take offense to that. But I think there's some really, really smart people, but they're just not, they don't have the freight kind of context and experience that we're so twofold.

SPEAKER_00 1:07:21

Experience teaches wisdom, big believer in that. And then secondly, you can't fake caring about the industry. These kids don't care about solving these problems for the people, about making the industry better, safer. They just want to build a great Silicon Valley company and IPO or sell it. And it's just a different ethos. Uh, you can't fake that.

SPEAKER_01 1:07:45

And uh so when you started this business, you mentioned like finding the problem to solve. Did you not like have can you kind of walk me through that? Did you not have an idea like, hey, I want to start Envoy because I want to solve carrier? Or you kind of said, I know AI is coming and I want to do XYZ. Can you walk me through that?

SPEAKER_00 1:08:08

I I started it initially. I wanted to solve specifically the way product was booked on the freight floor. I actually initially it was really I wanted to just make the carrier reps role better. That was I walked in and people were doing the same role that I was doing 20 plus years ago. And I thought we could just do it better. Uh, so that was really the genesis of, and then as I got deeper, I started to see that this was a new substrate of technology. It wasn't just gonna be this small little uh operational leverage. It was systems of record eventually will fade away as systems of action start to grow in strength. It might take three years, five years, I don't know how long. But once you see, once you can be a labor layer and not just a data layer, you can be a decision layer and not just that data layer. I think it I think it changes the industry. It changes sort of the it changes the entire game that that we've played the past 22 years.

SPEAKER_01 1:09:15

Um is there no kind of fear of the unknown? Like I that's maybe this is just a me issue, but you're you're you're playing in a sandbox that it feels like every day the box just gets bigger and new toys get brought into it, and it's like you're kind of blindfolded, you don't know what the toys are yet until they like show up. And what I mean by that is just the technology continues to get better at rapid pace. And like you're supposed to be at the front of that. It's just it's to me that would scare me because like I like dabbling in things that I know, and maybe that's a me thing.

SPEAKER_00 1:09:51

So that uh absolutely, I mean, I had an opportunity to get back into the freight brokerage industry, uh, operating a freight brokerage, and I just thought this would be a different type of challenge that I was interested in. Um, to your point, everything's changing quickly, which is why you need an office in San Francisco. If you are building AI applications for any industry, specifically logistics tech, you need a San Francisco headquarters and a team of AI native engineers. Uh, and I I never I would not say that a decade ago, but I have strong conviction in that now.

SPEAKER_01 1:10:29

And when you think about the way you're building this business, are you trying to take one problem and go extremely deep with just that problem? Or are you trying to go wider with five problems that you want to solve that are interconnected, or just any brokerage problem that you think your AI tool can support with the right agents?

SPEAKER_00 1:10:47

We are going very deep, career communication, verification, adaptive rate negotiation, and eventually booking. We are not going broad. Now, I'm an operator. I believe and have that there's a hundred-step roadmap to a totally automated freight brokerage. That said, I want to focus very, very narrow. Uh, I want to be a gold medalist in that. Uh, and then perhaps in a couple of years we can expand on. But this whole full life cycle, uh, order to cash, uh, I believe it's a great vision and we'll be there. But you have to start small, uh, execute. Uh Ellie, you know, we talk about execution. Everyone's like, why would you name her Ellie? Ellie stands for L E, load execution, because everything in this industry is all about execution, as you so eloquently said earlier. Ellie is the name of your agent. Yes. Um, it's not an agent, it's a it's a platform. So what the platform, sorry. It's you know, there's like a thousand agents under Ellie that are communicating and all interconnected. And that's what I didn't understand when I first started building. So, no, it's just one agent. But these multi-agent networks are very sophisticated. Uh, and yes, to your point, when my CTO and co-founder explains this to me and how to build the semantic layer long term, uh, yes, their IQ is at a totally different level.

SPEAKER_01 1:12:15

Is that like is that hard? Yeah, just for you like personally to it's inspiring.

SPEAKER_00 1:12:22

I mean, it's inspiring. It's the same reason why when your dad was building Coyote, he brought the smartest people in the room from different industries, from maybe trading or or or other different industries that you know, people that he knew could add value. Um, that's how we learn, that's how we get better as an industry, is we we level ourselves up. But yeah, there's certain days where uh you know my team's talking and I really have to, I'm Googling, or I'm not Googling, I'm I'm on Claude and I'm trying to interface saying, uh, what does a domain-specific language mean? I remember that was a specific question I had. Um so yeah, it's it's a learning process, but that's part of the fun of building.

SPEAKER_01 1:13:03

I I appreciate that you and you didn't say it directly, but I'm connecting dots here. You know, you talked about why load delivered was a success and why, well, you talked about why, like your approach, and you didn't go broad. You you went you went for the niche, riches in the niches, and went very specific and deep on that. And I appreciate that you're doing the same thing with your new business, even though it's a totally different thing. It's a tech business. But again, rather than trying to serve everyone everywhere all at once, you're saying we're gonna be the best at this one thing, and then we'll build on top of that.

SPEAKER_00 1:13:36

Yeah, well, I I got the idea initially, and then I had a tremendous mentor, Art Mesher, who is the CEO, uh former CEO of Descartes Systems, and he really helped me build out that thesis uh and execute it. Yeah. Let me ask you a question. So he calls it, by the way, niche oligopoly is what he calls it. Build a niche oligopoly, be that gold medalist in that niche, and then once you are unbelievable at that niche, take that feature, take that function, and evolve into a platform.

SPEAKER_01 1:14:12

An oligopoly is when a few people are in charge, is that right? It's just a couple. Yeah, interesting. I like that. Um, so here's my question.

Starting A Brokerage And Avoiding AI Hype

SPEAKER_01 1:14:21

I don't know why I said let me ask you a question, because my whole job is asking you questions. So uh, you know, I appreciate that, but I don't know what I'm talking about. But my point is if if let's say your son, Roman, right? Yes, let's let's pretend he's 24 years old. And he says, Dad, I want to start LD2. Low delivered second, load delivered the second. And he said, Dad, how should I do it the way you did? Or like what should I do differently now in this in the age of today's environment? Ojiton.

SPEAKER_00 1:15:03

So first the question would be do I think it's a good idea to start a freight brokerage? And I'd have to really know I'd have to really think about that. And then we would have to talk about what type of freight brokerage. And then we would talk about is it a cold start or are we going to acquire that? But I think my big question, my what I would probably tell him is what my dad told me is uh go figure it out yourself, come back, go get a job, come back, tell me what you learned. And after you spent a couple years learning, then we can can move forward with the plan of action.

SPEAKER_01 1:15:39

And and let's say he does that, he spends a couple of years, he learns, he's he's got brokered. Like I'm just curious, like let me ask more directly, do you think it can it's still a good idea to start a brokerage today?

SPEAKER_00 1:15:50

Absolutely. I think there's a couple areas specifically in brokerage. Uh, if you can figure out how to leverage technology, decrease your cost per load to serve, and you can serve as high uh, we'll call it high value, highly targeted freight and specific regulated niches, I think that's really interesting. I think we talked about earlier uh step dex and this whole massive industrial reindustrialization of the United States, this massive uh bill that was just passed and all the manufacturing going on. So I think where you and I grew up a lot in that CPG uh food world uh in the Chicago food brokerage, I think it's expand, I think expanding out of that into other niches will really uh that are different margin profiled. Uh I I would probably start there.

SPEAKER_01 1:16:41

Gotcha. All right, got another one. So there's a lot of talk in our industry, and it's it's not just about the Supreme Court, but just like it feels like every week there's a new topic that's this is changing, do it this way, whatever. Is there anything like what if you had to tell me what you think the most like overrated concept or idea in freight tech is today, what would you say that is? Like what's overhyped? What's what's embellished? What are the things that that you know the freight tech world is being a little too aggressive on?

SPEAKER_00 1:17:22

So I think that AI in general is overhyped. People think that you press a button and it just works. And that is way overhyped. It takes time for it to work, it takes time for ROI. That's why you're seeing some of these companies who've been doing this for a year, two years now, are just starting to show uh white papers and areas where they're really making impact for companies. Uh, it just everything takes more time than you would initially think, which is exactly why you should start that digital evolution today. And by digital, it's not the digital like you and I heard about with uh you know digital freight brokerages. It's it's an AI native system. And so setting yourself up so when the time is right, when open AI and anthropics, their models improve, you are ready. Because if their models improve and you're not ready to be a broker that can embrace AI native services, I just I don't know how you're gonna have a cost to serve at a specific point. I don't know how you're gonna verify carriers uh correctly and efficiently.

SPEAKER_01 1:18:33

Um yeah, I'm picking up what you're putting down. Well,

Andrew’s Next Chapter And Industry Legacy

SPEAKER_01 1:18:42

sir. I think that's all she wrote, unless you got something, unless there's something else you wanted to.

SPEAKER_00 1:18:50

No, I'm just excited to hear where you're going. Uh the big waves that you're making. And uh I'm just uh if you had to uh guess if you were gonna go to a shipper, start your own broker, or buy a broker, what is the most compelling out of the three?

SPEAKER_01 1:19:09

Man, I mean, you know, I I can't say who it was, but obviously, you know, I I'd put out there that I spent a long time talking to a shipper about building a brokerage for them. I it wasn't something I sought out, you know. They they sought they sought me out and and Vogrich as well. And we talked to them for like I it was 18 months at least. I mean, it was the slowest process, but it was really interesting to me the idea of building a brokerage like partnered with a shipper because you could just go to market so differently. I mean, this this company, most food and beverage companies would say this is one of their top customers. And to be able to go into a uh an create a to elevate a partnership that already exists through the you through the use of the skills that we have sounded really fun. Um, but you know, that wasn't meant to be. And and I think it would have been challenging, probably navigating a big corporate company. You know, I struggled to navigate a $4 billion company uh that that bought you know our last one, and and I would have really struggled to probably navigate a company 10, 20, 30 times that size. Um and so now the question is, you know, as soon as that died, it was all I was really grateful because like my energy shifted in such an like I was really happy. Like I immediately, it wasn't like I was sad that that ended. It was either gonna be that or I start my own brokerage. And so once that was gone, there was no like mourning that opportunity. It just was like, okay, I guess we're starting another brokerage, you know? And I then I got excited. Um, but what I'm realizing, and this was really a thought I had before the Supreme Court stuff came out, was I don't know if I want to do year one again. And I I personally didn't have to do year one because I was sitting up my non-compete last time, but Matt and Will and Stefan and the rest of the Molo guys did year one, and I saw from afar what that looked like. It is not fun to build a brokerage the first year. I mean, having no credit from factoring companies is a nightmare and it makes your job so much harder. Um, and and not having a developed carrier capacity group when you start is not fun. It's hard to move freight. Uh, so I think I want to look at buying something that's that's ready to be bought in a way that the team would still be excited to keep growing with new leadership and new vision and new opportunity and new capital. I wouldn't be buying it with my own money because uh wouldn't have the money to probably do it at the right size. But um, I've talked to some private equity folks who are like really interested in getting into this space and um with the right patient partner. You know, I'm talking to guys who are like, we we would want to sit on a business for like 10 years, and I'm like, I love that. Like I want to spend the next 10 to 15 years chasing Robinson. Like, that's what I thought we were doing at Molo. Like that's what I thought was gonna happen with you know the deal. And and it it, you know, I wasn't, I'm not a part of that, so it's fine. They're still chasing maybe, but I'm just so competitive and I love this industry. And I got to see Coyote rise to 2 billion plus and be like one of the top players. I got to be a part of my own team building something from you know the ground up to where we got to with Molo before we joined Arcbest. And I feel like I left a lot a lot out there. I feel like I I feel like I was taken out of the game early and I had to watch the team from the bench, you know? Um, and now it's like there's a new season starting, and I've been getting my my reps in and practicing, and I want I haven't really been practicing, I've been sitting here talking to guys like you. But uh my point is just that like I'm mentally stimulated and ready to get back to work, and I want to be like if the industry consolidates, okay, so be it. That doesn't scare me. It just tells me like we gotta run because we gotta be one of the ones doing the consolidating, not being consolidated, right? So like I think that if if there's only five or 10 brokers left, I'm very hopeful that I can be a part of a team that's like shaping the forever reputation of what brokerage is. Because if consolidation is where we're going, like 50 years from now, when people think about brokerage, they're gonna think about the five or 10 companies that are still around. And I really just am hopeful that I was a big part of shaping what that legacy becomes and hopefully putting people in a position where like they can have great jobs and and careers um helping our country move freight.

SPEAKER_00 1:24:02

Well, Andrew, we need more passionate leaders like you leading the charge. Uh I'm long Andrew Silver. I would be so excited to see you get back in and and and start building towards a $10 billion company. Uh just let me invest.

SPEAKER_01 1:24:20

I'm I'm I'm very open to that. So uh we'll have to keep chatting offline. And uh listen, man, I I'm really grateful that you uh let me kind of get you on the show and and dig into your your history with Load Delivered and what you're building now with Envoy. Um I think I think I think you've done a lot of great great stuff for this industry. And um I think we really need guys like you on um the tech side of things as this kind of new frontier is making a real impact on brokers and carriers and shippers, and we need the right people kind of shaping that. So um cheering for you and um you know don't be a stranger. Thanks a lot, Andrew. Appreciate uh you having me on. All right, we'll talk soon. Take care to our audience. We'll see you next time.