Singapore is trying to raise its profile as a global maritime financial center. Above, the Port of Singapore. Photo: roslan rahman/Agence France-Presse/Getty Images
Digital freight-booking marketplace Freightos has raised nearly $45 million in a Series C funding round to expand its technology and geographic reach and develop financial instruments for the container shipping business.
The round was led by Singapore Exchange Ltd. S68 -0.68% , Singapore’s stock market, as part of an effort to establish the country as a global maritime financial center. In 2016, Singapore Exchange acquired the centuries-old London-based Baltic Exchange, a shipping marketplace that pioneered the freight-derivatives market, for $103 million. Earlier this year, Freightos and the Baltic Exchange launched the weekly Freightos Baltic Index for ocean container-freight rates across major global shipping lanes.
Hong Kong-based Freightos currently counts 1,200 logistics companies that use its business-to-business marketplace, which runs about 1 million freight quote estimates a month. With that data, Freightos says it can power global price indices that are more broad-based than the Shanghai Containerized Freight Index that is commonly used to measure pricing in the shipping business.
“It’s very much about a strategic relationship,” said Zvi Schreiber, Freightos’s chief executive. Freightos plans to work with Singapore Exchange to deliver its container shipping index on a daily basis. “Freight is going to be ready for trading in the next year or two,” he said.
The company says its marketplace is gaining traction. The company’s marketplace functions much like Expedia Inc., offering near-instant quotes for international freight shipments, with options for ocean and air service. The company said about half of the latest round of funding would go toward technology research and development, and the rest would support efforts to attract more users.
Aside from Singapore Exchange, the latest funding round included existing investors General Electric Co.’s GE Ventures, ICV Partners and Aleph Venture Capital. Freightos has raised a total of $94.4 million in overall backing. Mr. Schreiber would not detail the company’s valuation beyond saying it is “well into the nine digits.”
Evan Armstrong, a logistics industry analyst, said Freightos has established “a pretty nice niche without a lot of competitors.” He said the U.S. market for digital freight-brokerage is much more competitive. Since 2011, investment in digital-focused freight management in the U.S. has topped $420 million, his firm, Armstrong & Associates, estimates.
Mr. Schreiber said technology is helping transform freight forwarding and shipping transactions that have long operated on phone calls and spreadsheets. “You’d have to be on the phone for three or four days to get these quotes,” he said. “As consumers we’ve had interfaces like this for 20 years, but in the freight industry this is really a revolution.”
Still, digital booking still accounts for only about 1% of global freight bookings, he said.
Write to Erica E. Phillips at [email protected]