Warburg Pincus Invest in ‘Uber’ for Trucking Company
Private-equity firm investing $255 million in technology-enabled BlueGrace Logistics providing online services for freight shippers, in what has been called “Uber for Trucking”
Private-equity firm Warburg Pincus has invested $255 million in BlueGrace Logistics, a Tampa-based firm that provides freight services for shippers via an online software platform, the companies said Tuesday.
The investment is one of the largest in a flurry of recent deals involving what investors sometimes refer to as technology-enabled logistics firms. Such companies are usually asset-light; use software to help customers generate business and save money on the shipping of consumer goods, raw materials and other products.
Venture-capital firms have invested in dozens of mobile smartphone apps that help match truckers with loads that need hauling, in what has been called the “Uber for trucking” model.
BlueGrace, which was founded in 2009 by Bobby Harris, a former loading dock worker from Tampa, offers similar freight-brokerage services, but also helps shippers, including manufacturers, consumer goods makers and others find the lowest price on transportation services using software that sifts through multiple offers and options for routes, costs and timing.
Warburg Pincus, which has been one of the highest-profile private-equity firms to invest in logistics companies recently, handled the investment out of its technology group. Alex Berzofsky, a Warburg managing director who led the deal, said that the firm expects companies like BlueGrace to produce higher returns than typical transportation companies like trucking fleets.
In 2007, Warburg invested in Coyote Logistics, a Chicago startup that offered freight-matching services to truckers with excess capacity in their trucks. United Parcel Service Inc. bought Coyote last year for $1.8 billion. Warburg was also an early investor in New Breed Logistics Inc., which XPO Logistics Inc. bought in 2014 for $615 million.