CloudTrucks CEO and co-founder Tobenna Arodiogbu sat down with Chris Jolly, also known as The Freight Coach, for an interview on his podcast, Coffee with The Freight Coach. Together they discussed the complete "business in a box" solution that CloudTrucks provides for owner-operators and small trucking carriers at a much lower cost using software engineering, data science and world-class operations processes. CloudTrucks’ mission is simple - to put more money in the hands of truck drivers and reduce their headaches.
Check out the excerpt below, or listen to the podcast in its entirety on on Apple Podcasts or Spotify.
Freight Coach (FC): As you know, when starting a company, cash flow is everything. And that’s what makes or brakes trucking businesses within the first year - mismanagement of money. What do you do when you’re owed $40,000 in a month, but your brokers take 30+ days to pay you, so what does that look like? Your credit cards max out, gas is $4/gallon, insurance is due, payment is due on your truck, and everything else so what do you do? My dad was an owner-operator and he drove for 40 years on his own. Back in the day, nothing was digital so I remember the stacks of receipts that he could come back with and it was all about managing your cash flow. I know that he didn’t want to expand out, but he said it was easier to manage himself. If you implanted him into today’s market, something like this would be extremely beneficial for him. He’s an old school driver - that’s all he wants to do. He wants to driver trucks, he doesn’t want to deal with any of this back office BS and I think that’s a big struggle for a lot of former company drivers who go out on their own. They just want to drive - pick up and deliver.
Tobenna Arodiogbu (TA): Exactly - and that’s what we’re here for. With the cash flow aspect, I always tell people there’s the cash flow problem - how long will it take for the broker to pay you, but there’s also the operational process of managing accounts receivable. Knowing which broker owes you, their payment terms, when you should be reaching out them, what documentation you need, etc - it’s crazy that people who are on the road are expected to think about and deal with all of these things. The reason why a lot of people decide to do this themselves is if they decide to go with a factoring company, the company wants to charge them 3%-5% and that’s a lot of money to give away. In the case of CloudTrucks, our goal is to make this as cheap as possible - if we put it at 1.5%. We’re tracking the location of your truck, so we know when you pick up and drop off - so when a delivery is dropped off, we can get you paid instantly and you never have to think about it again. If we help as many people manage these problems as possible, we’ll see more people transition from company drivers to owner-operators as it’s a better lifestyle. I think we’ll also see people that have been owner-operators for many years decide to expand their fleet and purchase that second or third truck to build out their business. This will be great for our country - logistics is the backbone of our economy and we need to move stuff around the country and make it easier for people who want to go into that industry to do so.
FC: We spoke about you immigrating to this country when you were 16 years old and there’s a lot of diversity in trucking and there’s a lot of people out there who were drivers in eastern Europe, Mexico, etc and want to come to the US to become drivers. There’s so many predatory loan practices that are out there are viewed as a sign of weakness and I, personally, hate that. Why penalize someone for coming out here and living the American dream. These drivers need companies that have their best interests at heart. There is a bad side of capitalism, but the overwhelming majority of people just want to work hard and go home and don’t want to be taken advantage of just like any of us when we’re starting our business. That’s the beauty of living in the US - the opportunities are truly endless and this is what I love the most about the business-in-a-box. As you mentioned, there’s three different products so let’s talk about the product where CloudTrucks handles everything. How does that operate?
TA: Yes, definitely, that’s Virtual Carrier. Virtual Carrier was the first product that we launched where we are the trucking carrier in May of 2020. We looked at the landscape and realized that there’s so many things that owner-operators need to deal with. Insurance, for example, being ~$24,000/year when you first start is not very manageable - nobody can really operate a business this way. We decided that in order to actually build the best product, we needed to take on the entire pain. We needed to get our own authority, which we did. We needed to get people under that authority, and manage every single thing for that person. So when someone comes on our VC product, they own their truck, but they lease it onto our authority. When they do that, every load that they get from brokers, they can get it on the CloudTrucks app. They can also go outside of the CloudTrucks app, bring it into our app, and use our tools to manage their schedules. We’re integrated with their ELD so when they’re looking to book a load, we can tell them if a load is feasible or not - based on hours left, what you’re trying to do, etc. We’ve also built something called Schedule Optimizer, where drivers can input a destination and the system builds a schedule for them based on loads. When drivers complete a job, we pay them instantly on their VISA card so they can go out there and spend how they please. For all of this, plus the insurance that we manage, we take 18%. Most other companies in the industry would charge 30-35% for something like this. The reason we’re able to do this is that we’re a technology company that’s building out tools to help owner-operators manage their business themselves and we know that as we continue to grow, there are more and more savings that we can get and pass on to the owner-operators so they can reinvest in their business.
Feel free to listen to the rest of the episode on Apple Podcasts or Spotify.
Want to learn more about CloudTrucks? Give us a call at (469) 250-1214.
