Jake Koppinger brings a high-tech perspective to an old industry with FreightRoll
By Joyce Wiswell
While working summers booking trucks at his father’s steel distribution business in Pontiac, Jake Koppinger was struck by how inefficient and fragmented the process was. He kept those thoughts in the back of his mind when he went off to the University of Michigan to study industrial and operations engineering, entered the investment field and eventually moved to San Francisco. More than a decade later, Koppinger and his brother, Matt, have joined forces to confront the process head on.
“It’s all very simple and our fee is 10 percent or less for each load, rather than the 20-25 percent markups that traditional freight brokers charge.“
— Jake Koppinger
FreightRoll is a next-generation freight marketplace and collaboration engine focused on the FTL (full truckload) market. It provides shippers with the ability to quote, book, arrange and track shipments from beginning to end, while at the same time helping truckers fill their empty miles, better communicate and get paid more quickly. Founded in 2015, the firm now operates in 48 states with a truck network of more than 22,000.
“It’s all very simple and our fee is 10 percent or less for each load rather than the 20-25 percent markups that traditional freight brokers charge,” said Koppinger, 34. “We think that the lack of transparency in pricing and misaligned incentives are big issues for the industry.”
The company individually screens carriers to ensure they have qualifications such as insurance and FMCSA rating. Once approved, the truckers, who use the service for free, join the FreightRoll network and use the platform to book new shipments and managing existing ones.
The freight shipping industry has long been ripe for disruption, Koppinger said, but truck drivers’ traditional avoidance of new technology stood in the way. “Truckers are averse to adopting technology,” he noted. “They did things on pen and paper, then by phone, and then by email, and that’s how they liked it.”
That changed as smartphones became as prevalent with truckers as the rest of society.
“I thought, instead of disrupting the $50 billion freight brokering industry — which is a subset of the $700 billion trucking industry — why not help shippers and truckers manage all of their freight?” said Koppinger, a native of Grosse Pointe Woods. “Why not create a very scalable software business that allows shippers and carriers to directly connect?”
The company, which began generating revenue in mid-2017, is currently a work in progress. “We still have stuff we are in development on, to be honest with you,” Koppinger said.
He’s bullish on how FreightRoll may alleviate the chronic shortage of truck drivers by helping new ones – who traditionally earn half or less than those with experience — make more money.
“You can now prove via third-party data that you show up and deliver on time and use it as a marketing tool. Maybe you can reduce your insurance premiums and allow companies to pay their truck drivers more. It’s an interesting way of helping — not to solve, but to make one of the biggest problems in the truck industry a little less bad.”
While Koppinger remains in San Francisco, FreightRoll is based in an Ann Arbor SPARK location where Matt, 30, and five employees work.
“Michigan is where most of our professional logistics contacts are and I view it as sort of important to contribute economically where I can. And we are primarily focused on building density in Midwest and Southeast, where others have not been as focused,” Koppinger said. “We have no immediate plans to relocate; we will definitely outgrow this space but I’m not sure what is next. We are still a very early-stage company.”
He’s also in the early stages of the 22X Fund, the first digital security token for tech investors. The idea was hatched last summer when Koppinger participated in Batch 22 of the 500 Startups program, the prestigious early stage venture fund and seed accelerator. (The exclusive 500 Startups program has only a 2 percent acceptance rate.)
“One night we were talking about the idea of a digital security token and someone said, ‘why don’t we each put some percentage of our company equity into an ICO [initial coin offering]?’” Koppinger related.
The idea took off among the group and the 22X Fund includes 30 of the 36 companies in that Batch 22 program. Koppinger is a founding member and sits on the steering committee for the mutual fund-like instrument, which functions somewhat like a cryptocurrency by using blockchain technology to “democratize access to capital.”
“We were called crazy by I don’t know how many people and went through four or five sets of lawyers who wouldn’t take on the project,” Koppinger said. “We learned a ton and came up with our current partner, Securitize Capital. I’m a full-fledged believer that not everything is going on the blockchain but there will be definite applications in a lot of areas of time.”
Meanwhile, he’s charting the growth of something even more meaningful – 9-month-old daughter Kate. Koppinger and his wife Christine, an innovation manager at Nestle, welcomed the baby during the same week that Koppinger began participating in 500 Startups and the idea for 22X was also born.
“It was,” he recalled, “a crazy July."