Q&A: Marc Gorlin, Roadie Founder & CEO

Last month, Atlanta-based Roadie, an on-the-way delivery service with the nation’s largest local same-day footprint, announced it raised a $37 million oversubscribed Series C funding round. This round was led by investments from The Home Depot, Warren Stephens, and Tomorrow Ventures, in addition to other investors. In a competitive market, Roadie has made significant inroads to establish itself as a major player in the last mile market through its unique crowd sourced carrier network, coupled with its increasing national footprint and delivery partnerships with major retailers, including The Home Depot and Walmart, as well as other industry sector leaders like Delta Air Lines. Logistics Management Group News Editor Jeff Berman recently caught up with Roadie Founder & CEO Marc Gorlin to discuss Roadie’s growth map, market conditions, and what may be coming next. A transcript of their conversation is below.   

Logistics Management (LM): How much has Roadie has raised to date?

Marc Gorlin: With this recent announcement, the total raised is now at $62 million.

LM: What does this $37 million infusion do for Roadie as a company? How do you leverage this investment to help increase your presence in the market and grow?

Gorlin: Well, it helps validate the model in and of itself. It is truly crowd sourced, where you are not just paying someone on a shift like an Amazon Flex. We ran up against a lot of walls in the retail industry for a while, because people essentially were wondering if [our model] it really worked and will their stuff get delivered. And more and more, now, as people like Home Depot, Walmart, and Delta, and other companies we are working with use it, they are realizing that not only is their stuff getting delivered, it is getting delivered faster and a lot friendlier than it would before, and also faster, because it is going point-to-point, and straight from the store to the door.

LM: Why is it friendlier?

Gorlin: It is friendlier because we are using a collective of people that includes your employees, relatives and people that shop at your stores and in the surrounding communities like the guy that works at Starbucks or JiffyLube. All of these things together form a tightly knit bond of deliverability that has the same reliability as if you had a fixed asset. It has distinct advantages like how the crowd sourced model can go longer distances outside of the five or ten mile window that many companies operate in, as well as moving larger or oversized items, or smaller things, too, because our crowd sourced network has both large trucks and small cars like Priuses. One of the biggest things we see for retailers is peak capacity.

LM: How does peak capacity factor in?

Gorlin: When retailers hit peak, they need a workforce that can flex. It does not matter if you have four vans or if you have four people that you are paying sort of flexed time to, because you only have those assets. We can effectively put the entire crowd on to any sort of prompt. So it flexes up and down nicely and it can get better as more volume comes in. We are going to build our sales and marketing functions and also focus heavily on data science, which is understanding through a crowd sourced model what should it cost to deliver from anywhere to anywhere at any time of day and all these different layers that come with it, as well as evolve all of this dynamic pricing and data we have put together.

LM: With the crowd sourced model and not having to deal with the internal costs of running an asset-based business, and flexing up and down in a team environment, what do your customers like most about the Roadie model? Why is it effective for them?

Gorlin: One thing is that it is very flexible to their needs, as a lot of retailers are moving from buying online to ship to store or from pick up in store to deliver from store. It is an ever-increasing fight as Amazon continues to raise the stakes. It is flexible to what they want to do. They can turn it on relatively easily, and they can deliver multiple distances for things of any size or also flex for their peak. A lot of systems cannot do that. It solves a lot of their problems without having to invest into a fixed asset and not knowing where those assets are. With a crowd sourced model, you are not building a church for Easter Sunday, and you can effectively allow it to flex. The other thing it is that it is just friendlier. We had a guy deliver a microwave oven to an 86-year old lady that did not know how to install it, and he helped her set it up to get it running, and we had another driver deliver blinds to a new parent that was very busy and the driver was able to help set up the blinds, with the blinds coming earlier than expected before the newborn’s nap time. Those are not the type of stories you typically get from faceless delivery drivers.  There is another example with Delta in which we had a driver that was a ticket agent deliver lost baggage to customers at their homes near his home, so he got paid to do what he was going to do anyway i.e driving home. It is great for him and for Delta and the passenger.

LM: With things like BOPIS, last mile, and increased e-commerce activity, your model seems to be resonating. That said, how would you describe the emergence of your market, in general, going back three-to-five years compared to today, in terms of its seat at the logistics and supply chain table?

Gorlin: I think that optionality is important for e-commerce providers to figure out. It is like how people used to receive DVDs in the mail from Netflix before streaming became big. So, when streaming first got going, nobody was doing it…because there were no shows available. But when they added popular shows, there was optionality in things to watch, and it created the binge watcher. The same thing happened with e-commerce, as they figured out long before the brick and mortar stores to provide an option for ground shipping and 3-day and 2-day and 2-hour and 1-hour, with Amazon taking it to a new level. But customers want those options…if they need things sooner or later. What we have seen is, I think, retailers realizing that if they are going to complete their brand promise to their local communities, they need to have this as an option. Retailers have also started to figure out that it is becoming more and more important. In some cases, to be honest, I think there are things people might not care as much about for same day, and we think about and make it our business to look at those. This works for things like groceries and deliveries and airports and home improvement. I think there are a lot of great markets to tap. It feels like we are only halfway through the first inning. There are retailers still trying to figure out buy online pick up in store or maybe ship from store so they can zone skip to save a little bit and get goods to customers faster instead of reaching for two- or three-day deliveries, which is almost like black and white TV and is what many consumers still get from retailers.

LM: How do you view the competitive landscape for the markets you serve, given that a good amount of last mile service providers are regional, whereas Roadie is national? What are the competitive market dynamics like, in your opinion from a national and regional perspective?

Gorlin: In its most simple form, most retailers, or anybody, would prefer to have one company to deal with across the board where the system integration is the same, as well as reporting, customer service, and technology, rather than having many different partners. The problem is not everyone can do it everywhere. People want to buy goods when they want to and retailers are the same way from the other end, because they do not want to lose a sale. That can be done with a conventional white glove service, which means different things to people, or, if they are comfortable of the equivalent of a friend with a truck showing up and getting your chair or ottoman, it can get delivered to the consumer at half the cost on the same day, so it is less money, same day or you can wait a few weeks. People are going to opt for speed and a quicker delivery.

LM: What are the next steps for Roadie as a company going forward, in terms of expanding its service footprint.

Gorlin: We deliver to more than 11,000 cities and towns and cover 89% of U.S. households and have more than 120,000 drivers on our network. What we are trying to do is to tap into what I think is one of the last great national resources in America, the transportation map of more than 250 million vehicles hitting the road every day with 4 billion cubic feet of excess capacity. Roadie is trying to put that capacity to use and get deliverables into certain markets and places. We have drivers everywhere, but you need to have a base load for demand to make sure everything gets delivered. And we are signing key partnerships, like with Home Depot, as people do have that need, and we are trying to add more of them.

LM: Where do you see things heading from both a Roadie and a market perspective over, say, the next two-to-four years?

Gorlin: In some ways, we look at a company like UPS, which is an amazing business, which has had a 107-year head start, and we want to build Roadie akin to that, with the same consistency, viability, and deliverability to anywhere you want to send something. We deliver in places like Atlanta and Charlotte, so instead of having two disjointed courier companies…what happens is you actually build corridors between them in places like Greenville and Spartanburg. That does not happen with other models, and we have stuff moving from one place to another where we have not spent a nickel doing any marketing. And we can serve them in a cost-effective way just like we could if they were in an urban environment.

LM: Are you constantly looking to add retailer partner relationships?

Gorlin: Absolutely. We think we are a great option for big retailers in pretty much most of the country for getting stuff delivered, and we will continue the conversations with all of the ones we are having and try to figure out ones that we are a good solution for, get them signed up, and expand from there.