SME Feedback page

Rahul Mehta - Infreight
Like Raaho there are many startups - approx 20
They have struggled with stickiness
stickiness is where the problem is
Founder seasoned entrepreneur but not from industry
Business model perspective wise Rahul was not impressed
Trucksuvidha, delhivry (on track to launch), gotruck, truckhaul are all similar to Raaho platform
Raaho’s claim of displacing broker is a good story but the broker is as old as transportation so it’s hard to displace
Plus Broker nowadays is doing a lot of add ons such as guaranteed payment, advanced payment, accident help... many more, which makes it harder to displace
many of the brokers have become fleight owners themselves so becomes harder to crack and to displace the brokers
Reason why others haven’t worked:
Broker does so many add ons
blackbuck is the ideal comparison but they also didn’t get any traction in the same space as what Raaho is trying to do
understanding of what role the broker plays is not fully explored by Raaho in the pitch deck as brokers nowadays add a lot of value
one assumes that the driver is going to use the app but that’s not possible as he’s more comfortable with the broker as the driver’s relationship goes way back
Understanding of supply demand mismatch is what people doing platforms like raaho misses out on
They look at macro numbers and the founders miss out on supply demand mismatch which leads to eventual downfall
Relationship between driver and broker is something that can come in between the success of platforms like Raaho
North star metric 3 years down the line:
what percentage of trucks they are able to retain consistency
Stickiness is key
How will the model work:
One is understanding of the micro demand supply mismatch
Long term
Address this situation of trucker getting rapid back to back loads and create a base of truckers
Understanding Supply demand situation
Even doing circuitous routes
Showing the value to the trucker, over a period of time
Short term
Go to shipper and discount your freight
But they should be able to sustain it
Develop the routes and network
But needs a lot of money to be pumped in

Hema fortigo
Fortigo also had the same plan as Raaho
basically they also wanted to create a marketplace
This space is very fragmented and a lot of people
Wide variety of transporters in the space
Educating them and changing the way they go about their process is a problem
There have been players even before blackbuck and rivigo
Change in practices will be hard
Dynamics during loading can not be taken into account through the app/technology
Fully autonomous business through app not possible there still has to be human intervention
KYC is important - to avoid fraud
Adoption of technology is one of the biggest challenges
Not many VCs investing in this space
Unless they become a transport company they cannot sustain as per previous history in the same space

Juzar
The business model is a good model
The space is crowded and there are many people doing the exactly the same thing
Many competitors have a head start
There’s nothing new compared to competitors
Brokers play a big role in the transportation chain
They find drivers and provide security to the fragmented space
Instavans, iloads, trucky, freight tiger are doing almost the same thing
Biggest challenges is security on the drivers and truck
physical security
Large numbers of cases where trucks and truck loads go missing
Brokers know who the drivers are and therefore they play a crucial role
There is an opportunity for KYC to come in for security
If Juzar was Raaho, he would make the broker community part of the app
He couldn’t find anything unique
Raaho would find it hard to scale up if they ignore the brokers role in the business model
Even after pumping in money they won’t be able to sustain
Real frustration for truckers to move away from brokers
Small truck owners there is no reason to move away from the brokers
The only problem is finding loads
Brokers are static as they are only known for certain routes

Raaho suppliers

Get the load very fast - so turn around speed is great
They get paid advance 3 hours after taking load
And money comes into PED within 7 days
Been on the platform for 3 years
Overall app experience is great on the app
First 1 year there were problems with the app
However now last 1 year the suppliers have been very happy with the app and raaho as a company

Venkatesh
He talked to Imthiaz about the model
Blackbuck also had a similar model as Raaho initially before pivoting
Problem Blackbuck was facing with the previous model was that they were paying 80-90% advance to truck owners
Raaho wants GTA to put in money and is ready to make smaller margins
Specific lanes and specific trucks makes the volume limited
Raaho needs to have a specific hypothesis on how are they going to attract certain trucker (large load)
Truck owner needs information and money
Raaho giving advance is their main USP
Load board - collect data from required shippers and they will pay eventually
The problem with logistics is that there is a fundamental mismatch between supply and demand
Only when there is a significant benefit economically they will break their habit in the logistics industry
Raaho breaking into load board
Established players like P&G,
Large players will only use load board only if there are a lot of benefits
MSME market for them this load board will be a lifeline
The specific lanes Raaho should find the MSME and reach out to them
MSME have iron grip on brokers
How to bypass broker
The financial shackles should be broken if you want to be successful digital broker
Good Rate for load
Settling the advances in a fair and understandable manner

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