The current state of our COVID-19 world has underscored more than ever the need for reliable delivery and e-commerce services: consumers sheltering in place are shopping at unprecedented levels online and getting items brought directly to their homes; and retailers urgently need web-based platforms that can help them manage, sell and bring their goods to those people — becoming for many the only way they can now do business. And companies that are helping make those transactions work are doubling down.
DispatchTrack, which provides a platform for last-mile deliveries, specifically to help companies mimic Amazon-like experiences for themselves by planning and tracking deliveries more easily, has closed a $144 million investment, its first-ever funding after scaling up as a bootstrapped startup to support more than 60 million deliveries per year.
The funding is coming from a single, high-profile investor, Spectrum Equity (backer of many other huge tech companies that have straddled the offline worlds with online services, including SurveyMonkey and GrubHub). The funding is being termed by the company as an investment rather than an acquisition, although I’ll note here that PitchBook has described it alternately as a leveraged buyout in its database. In any case, the founders are staying on and still leading the company, and Spectrum is taking two board seats.
DispatchTrack was founded in 2010 in San Jose by a husband and wife team — Satish Natarajan (now CEO) and Shailu Satish (now COO) — who also happened to work in tech, after the pair grew frustrated with how badly home delivery services worked for themselves.
DispatchTrack today counts as customers both retail and wholesale companies across a number of verticals such as furniture and appliance businesses, food distributors, healthcare companies, consumer retailers, and building suppliers, as well as field service businesses and third-party logistics (3PL) providers that use DispatchTrack to power their services.
The platform itself is a kind of all-in-one logistics and delivery toolkit designed for ecosystems that include physical storefronts, warehouses, drivers and end customers, a chain that has a common thread running through it: none of the businesses in the chain (nor the consumers, for the most part) are fundamentally tech experts, yet may have staff who handle logistics; and they need technology to do their jobs — but don’t necessarily want to bring in more costly system integrators to develop or operate those systems on their behalf.
DispatchTrack includes features for managing routing and planning (including telematics and compliance), customer communication (including reservation systems for delivery slots), driver communication (via a mobile app), billing, social reviews, and omnichannel order tracking.
These services may not be the first that a consumer would think of when considering products online — you as a consumer are considering the product and its price and how fast you can get it, most likely — but they collectively constitute a huge part of the cost of providing the product, and typically are not handled very well. (DispatchTrack cites CapGemini Research Institute that estimates that together they account for 41% of all supply chain costs.)
That cost also, naturally, translates as an opportunity, and DispatchTrack is not the only company providing tools to fill these needs. Oracle, Salesforce, SAP, logistics giants like Amazon and many others also provide software to retailers, but DispatchTrack would argue that its solution is the more comprehensive and is better for being focused solely on delivery and logistics, without competing with its customers (it provides no logistics services of its own, nor sells anything).
“We are thrilled to partner with Spectrum Equity in this new stage of our growth,” said Natarajan in a statement. “We built DispatchTrack to help businesses large and small provide superior delivery experiences, streamline operations and maintain coordination and transparency across all constituents in the last mile. With Spectrum’s support, we will continue our rapid pace of innovation and be able to bring best-in-class solutions to more businesses, industries and geographies.”
Choosing to finally pick up outside investment happened ahead of COVID-19 — it seems the first tranche of the funding was secured back in December 2019 — but it comes at a timely moment, when companies like Instacart are seeing all-time peaks of usage from customers who are no longer doing grocery shopping in physical stores because of the coronavirus outbreak. While DispatchTrack’s own trajectory was in place before now, this gives it an even stronger mandate to invest in growth.
“We look forward to supporting DispatchTrack’s commitment to solving complex problems by building elegant, powerful products that are easy to adopt, configure and scale,” said Vic Parker, MD at Spectrum Equity, in a statement. “The DispatchTrack platform is an exceptionally valuable solution for businesses that recognize the strategic imperative to optimize the delivery experience. We look forward to helping DispatchTrack transform the last mile for more businesses across categories and around the world.” Parker and Spectrum VP Adam Gassin are joining DispatchTrack’s board of directors with this investment.