Deal Dive: Iron Sheepdog is fixing short-haul trucking from the bottom up

Will Lawrence, the co-founder and CTO of Iron Sheepdog, likes to say that sometimes building something simple is actually really hard. Building simple-to-use technology for the short-haul trucking industry is Iron Sheepdog’s goal. That approach is also why the company thinks it has been able to see a level of adoption from the industry its competitors haven’t.

The Williamsburg, Virginia-based company’s software looks to make the short-haul trucking space, which largely involves outsourcing short-haul jobs to truckers booked through brokers, more seamless and efficient. Companies can track their contracted trucks through Iron Sheepdog, giving them more transparency into where trucks are, how long a job takes and how much to pay. The truckers themselves get an easy-to-use app that helps them accept jobs and get paid online.

Iron Sheepdog announced this week a $10 million Series B round led by SJF Ventures with participation from Grand Ventures, Supply Chain Ventures and strategic partners. Mike Van Sickel, Iron Sheepdog’s co-founder and CEO, told TechCrunch that the company spent its first few years making sure it could get customer adoption and reach profitability. Now it’s looking to scale.

“Trust is the most important feature; we have to get the subhauler to actually use the app,” Van Sickel said. “All the solutions out there that contractors force [subhaulers] to use, if they aren’t willing to embrace it, you are creating more problems.”

The idea for Iron Sheepdog came out of lived experience from the three co-founders, Van Sickel said. None of them worked as short-term truckers themselves, but rather for companies that hired them. Van Sickel said that despite software solutions existing for every other part of their business, there wasn’t a great solution for hiring short-haul truckers. The existing process frustrated both sides.

While not the first company to try to build software to manage these short-haul truckers, Iron Sheepdog has been able to see its growth double each year since it was founded. That’s because it approached building differently than its competitors. Instead of focusing on the contractors to drive adoption, they started with the short-haul truck drivers themselves.

“We chose to look at the problem from the bottom up instead of the top down,” Van Sickel said. “We made a very simple app for the subhauler and tied it to 24-hour pay. I call it simple; it was intentionally simple so that they would adopt it.”

Getting the truckers to sign up for the free app pushes the brokers who supply their jobs to sign up and it works up the chain. Contractors want to sign up, too, knowing the app gives them access to a network of more than 4,000 short-haul truckers. The company makes money as these contractors pay the underlying truckers through the platform.

Van Sickel said that now that they’ve got a substantial number of brokers and truckers on the platform, companies can start to better utilize them. For example, a company could hire a truck to do two jobs on the same day or drop off material at two sites, reducing the number of trucks needed. This could also help cut emissions.

“If you think about Uber Eats, the Uber driver doesn’t leave his house, pick up the sandwich, go to your house, and go home. That’s not how the industry works,” Van Sickel said. “Once you get on these trucks you can start to find ways to better utilize those trucks.”

Iron Sheepdog’s round stood out for a handful of reasons. For one, investment in construction tech startups has grown in recent years, but this part of the system hasn’t seen the same attention. What good is software that speeds up job site planning if coordinating the trucks to get the job done will slow the process back down?

Innovation around trucking has largely overlooked this area, too. Companies looking to build autonomous construction vehicles and companies looking to fix last-mile freight already exist, but much less tech is devoted to dump trucks and equivalent. There are other companies looking to help fix this including TruckIT and Loadtraxx, but Iron Sheepdog looks like one of few, if not the only, venture-backed startup tackling this problem.

Iron Sheepdog’s focus on adoption is also notable. While it seems obvious that companies should build products that the organizations they are targeting will actually use, that doesn’t always happen, and there are a lot of industries that remain behind technology-wise as a result.

There is nothing good about new tech if no one is using it.

“It’s got to be a crawl, walk, run approach, it can’t be a crawl, run approach,” Van Sickel said. “There is a disconnect between some of the software solutions that are being developed and a willingness by the individuals who will actually use it to embrace them.”