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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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