By Richard Hoehn, founding CIO/CTO of FreightWise
When we began trading in 2016, our company’s first week of revenue amounted to a megare $150. By the end of 2018, however, annual revenue had grown to $33.4 million, representing an increase of 30,547 percent over just three years. Our technology is now being embraced by high-profile clients including Facebook, and our Nashville-based startup was recently named America’s second fastest-growing private company on the 2019 Inc. 5000 List. So, how exactly did we get there? Here are four key strategies that might also help your own tech company enjoy rapid growth.
1. Identify and fill a gap in the market
FreightWise was founded to make it easier for medium-sized enterprises to efficiently buy and manage LTL (less than truckload) and parcel freight. We didn’t want to replicate existing businesses in hopes of stealing market share. Instead, we wanted to build a better mousetrap. We took that approach for two main reasons: first, because we take pride in innovation, and second, because filling a gap gives a product staying power. At our inception, we identified a problem in the logistics industry that companies typically try to address through a combination of existing systems, services and convoluted internal processes, with varying degrees of success. Once we had narrowed our scope, we built our solution with a heavy focus on self-service and transparency, which also differs from the majority of offerings in the space. All of these decisions were made with a view to differentiate our company from our competitors and to present unprecedented value to our clients.
2. Consider bootstrapping
We noticed that companies founded with outside money often became slaves to short-term decisions in order to meet their investors’ expectations. We specifically avoided this for our company. Bootstrapping allowed us to invest several years in hiring devs to build our system before ever hiring salespeople, ensuring that we had a viable product to go to market. We also limited initial investment to strategic individuals who would contribute to the company professionally as well as financially. Once we started taking on clients, we were then able to allow those clients’ needs to point us in the direction of further system development, as long as those needs were scalable to existing and future clients. There is, of course, risk and reward with bootstrapping – we now control more equity but, earlier in our journey, we also had a much greater risk of financial hardship and endured the pain of stretching every dollar.
3. Self-develop your tech
The primary cost of building our system from the ground up (aside from our partners’ financial investment) was that we went to market with an unproven product. Freight is one of the oldest industries in the world, and yet is one of the least technologically advanced. As a result, new software-based solutions are often met with skepticism. Challenges aside, the overwhelming advantage of self-development is the level of flexibility that it provides. If we’d purchased a pre-existing solution, it could only have been customized to the needs of our clients by buying additional modules from our provider, or by writing patchwork code that would have achieved our goals in a less than efficient manner. Additionally, in buying proven technology, we would have been investing in a system that was mature but also had limited possibilities, whereas we developed our own system with our company’s future state in mind, from the ground up. To do self-development properly, you must align the corporate strategy of the products and services you offer to the maturation cycle of your system.
4. Take a sales-first approach
The sales force is our single largest investment, and one of the most important. Moreover, we believe that a sales-first approach to our company is the same as a client-first approach. The sales team is the closest to our clients, they have the largest stake in a client's success, and they are held accountable for the client’s ROI on FreightWise’s program. We focus not only on helping prospective clients understand what we do, but also on understanding their individual logistics environments and how our product would fit. This sales-first approach combined with aggressive tracking of project ROI keeps all parties educated and honest about the value of our efforts. Through our process, we are 100 percent focused on our clients’ success, both financially and operationally. After all, that’s how your company will succeed – by helping your customers succeed.
Richard Hoehn is CIO/CTO of FreightWise, a cost-management technology provider that tightly integrates with a client’s existing infrastructure to reduce time, money and resources spent on logistics and transportation. He has more than two decades’ experience in tech, management and academia and was a founding director of FreightWise, named America’s second fastest-growing private company on the 2019 Inc. 5000 List.