The people involved with the start-up company One20 don’t really consider it a social media company, but one dead giveaway is that One20 doesn’t plan to charge its users for its products. Like with Facebook or Google, the users pay nothing.
This isn’t the kind of social media company, though, where the teenagers will be the first to start using the app. One20’s trying to help people who drive a big truck for a living.
Just so you realize how much economic potential there is in a company giving away software to truckers, One20 has already raised more than $38 million in capital.
The company is here, in Chanhassen, because of the history here of companies producing technology for the trucking industry. One20 founder and CEO Christian Schenk came here after XRS Corp., then a little publicly held company, bought a Canadian company called Turnpike Global Technologies in late 2009.
XRS was one of the early innovators in fleet management technology. It was going nowhere in 2009, buying Turnpike as part of its strategy to get more competitive by moving its technology onto tablet computers and other handheld devices that the drivers usually carried with them. The plan eventually worked, too, with XRS getting acquired in 2014 for about $178 million.
Schenk didn’t form One20, Inc. until late last year but said he’s been working on the business far longer. The market for fleet management software in the trucking industry seemed poised to grow, he said, due in part to a mandate to make sure all drivers maintained electronic logbooks. What investors in traditional software providers probably didn’t realize was that Schenk planned to completely upend the market by giving away for free what software companies have been collecting fees to provide.
Schenk wasn’t really interested in producing more software for fleet operators, mostly because he saw what happened in other technology markets when rank-and-file users ended up deciding what got adopted, not the corporate chief information officer. It was bound to happen with truckers. It’s a relatively big potential market, too, with enough drivers for Schenk to establish a goal of getting more than 2 million members by the end of 2018.
His understanding of the opportunity, Schenk said, really started with watching what happened in Canada, where he is from and where the darling of the technology industry at one time was Research In Motion. RIM, as it was called, was creator of a brilliant device called the BlackBerry.
Years before Steve Jobs first showed the world an Apple iPhone, RIM was producing BlackBerry smartphones with the e-mail capability that business road warriors loved. The corporate IT bosses liked them, too, very secure devices that could be integrated with the corporate e-mail system.
The end of the BlackBerry era came when employees became accustomed to their handy iPhones and Android phones, and no longer wanted to carry around two devices or put up with the corporate IT department’s controlling ways. They wanted their work e-mail to appear on a phone they chose.
When top executives started using the family’s new iPad and began asking IT directors to please explain again why they couldn’t use one at work, it was game over for the BlackBerry.
“So the last few years we were thinking of how to create that same momentum in transportation, really building something cool for the driver,” Schenk said. “We looked across all platforms, all categories … and the common theme was we couldn’t build something and charge for it.”
A basic organizing idea for the company is that truck drivers didn’t need more things to buy. Instead they could sure use a break. These are difficult, long-hour jobs that no longer pay that well, and obviously they mean big stretches away from home.
The drivers maybe couldn’t spare any money for cool technology, but the travel center retailers and other companies interested in building loyalty with drivers had ample marketing budgets. Schenk knew drivers would be interested in hearing about precisely targeted daily deals, too, for a cheap meal or a penny or two off on diesel fuel.
The One20 corporate clients get more than an advertising audience, as One20 and an affiliated social network will happily share what they are hearing from professional drivers, like when they have started passing the word that a particular travel center should be avoided due to messy restrooms.
And the drivers are more than happy to tell people what they think, too. Drivers are about 11 times more likely to share information than the average consumer, according to One20. They work all day mostly alone in their cabs, but their community is all around them, passing by on the highways and at the travel centers.
That’s why Schenk doesn’t describe One20 as a social media or technology company, but a “membership” company. A good example that has nothing to do with traditional fleet management software is One20 Strong, a program for drivers interested in becoming more fit and eating more nutritious meals while on the road.
To really take off, though, Schenk knew One20 also had to provide good basic tools to make buying the traditional software no longer necessary. That’s why One20 is planning to roll out a driver-friendly electronic drivers’ log system, for example, and now lets users plot their own travel route that’s safe and efficient for an eighteen-wheeler.
“I figured it was a year and a half down the road” from One20’s late August launch, Schenk said, before large fleet operators started tracking him down to confirm that One20 could provide for free about the same tools they had been paying for.
Schenk said it didn’t take nearly that long to get that kind of phone call from a big fleet operator’s chief information officer. In fact it took about a week.