Investors across the U.S. are betting on the growth of a Bloomington-based software company that built an Uber-like app where professional, independent drivers can supplement their income by making deliveries instead of transporting people.
Dispatch concentrates on last-mile deliveries of parts, materials or equipment between businesses, instead of transporting people or retail goods to customers.
"The market opportunity is massive, but sees way less attention when compared to [business-to-consumer] last-mile delivery," Jack Freeman, partner at PeakSpan Capital, said in a statement. "The [Dispatch] team has brought an innovative digital labor marketplace solution to industry segments where the last-mile delivery pain is most pernicious."
Dispatch raised $50 million recently in a Series C round of funding led by San Mateo, Calif.-based PeakSpan Capital. Since its founding in 2016, the company's leaders have raised about $75 million in venture capital, including closing on a $11 million Series B round of funding in June 2020.
Other funds invested in Dispatch include Texas-based funds Labora and Trinity Investors, Revolution's Rise of the Rest, which is operated from Washington, D.C., and San Francisco, and Minneapolis-based Great North Ventures.
Through the mobile app, drivers receive notifications of requests from businesses. The drivers, who operate cars, trucks or vans, are provided through the app the quickest routes to pick up parts or packages that are then delivered to a final destination.
A separate online web application allows businesses to order, track and manage their deliveries.
The addressable market for Dispatch in the U.S. alone is $37 billion, said Andrew Leone, CEO and co-founder of Dispatch. Leone did not disclose revenue numbers, but said the company has experienced a growth rate of 200% in the past two years. Dispatch drivers, he said, have picked up materials and parts from more than 10,000 locations like warehouses, storage facilities and distribution centers.
Last year, the company launched Dispatch Connect, a last-mile delivery management system that businesses can use for their internal fleets, but also gives the option to use drivers on the Dispatch marketplace.
"We see that being a huge part of this growth phase," Leone said
Dispatch experienced rapid growth in 2019 and 2020, with the app becoming operational in 50 cities. The last two years, though, Leone and his executive team focused on improving the fundamentals of the business to position Dispatch for a larger round of funding.
The fresh capital will be used for expanding into 50 additional markets across the country, mainly on the West Coast, within the next two years, Leone said.
The money will also fuel the creation of new go-to market teams in those cities, resulting in at least 50 new territory sales management jobs, along with new enterprise sales positions, Leone said. The company will also hire more product and engineering professionals to improve the app.
Dispatch currently employs about 170 people, but Leone expects to increase the company's payroll to more than 250 by the end of the year.
