Global Logistics Focus

Special Report

Procurement software acquisition gives Freightos deeper contract freight reach

By Eric Johnson

Freightos ’ acquisition of cargo procurement platform Shipsta will allow the online freight marketplace , which primarily facilitates spot market transactions , to expand further into contract bookings .

The purchase , which cost $ 5 million in cash and roughly $ 1 million in stock , will give Freightos access to an existing base of customers using Shipsta to execute mostly contract freight tenders with carriers across ocean , air , road and rail , Freightos said in a statement Aug . 19 .

“ It ’ s partly strategic and partly opportunism in that they ’ re available for sale ,” Freightos CEO Zvi Schreiber told the Journal of Commerce . “ We know them well as we have customers in common . They focus mainly on tenders and contract rates and negotiation . And we ’ ve been primarily focused on the spot market . That creates great opportunities from a software and a data perspective .”

Adding Shipsta ’ s product to its ocean freight marketplace and its WebCargo air freight e-booking platform gives Freightos deeper reach into the enterprise shippers it was already starting to target , Schreiber said .

“ When we work with [ small and medium-sized business ], it ’ s mostly spot , but enterprises mostly do contract in air and ocean ,” he said . “ And they want to negotiate and benchmark their tenders . It fits together nicely .”

Publicly traded Freightos announced the deal as the company released its second-quarter earnings , in which Schreiber said the company , which was founded in 2012 and has never turned a profit , is aiming to be profitable by the end of 2026 . The addition of Shipsta , which is not yet profitable , is intended to help that effort .

Freightos reported revenue of $ 5.7 million for the second quarter of 2024 , up 11 % year over year , while its operating loss narrowed 22 % to $ 4.6 million .

Shipsta is expected to contribute around $ 800,000 to Freightos ’ revenue during the last four months of 2024 , with a “ moderate negative impact ” on its adjusted earnings before interest , taxes , depreciation and amortization ( EBITDA ), Freightos said .

Luxembourg-based Shipsta , founded in 2015 , has raised about $ 10 million in venture capital . Its customers across the retail , industrial and pharma sectors include Puma , Thyssenkrupp , DIC Asia and Rockwool .

Shipsta ’ s management team , including Managing Director Christian Wilhelm and Chief Information Officer and co-founder Stefan Maratzki , will stay on to lead Shipsta ’ s product development , innovation , customer success and go-to-market strategy .

email : eric . johnson @ spglobal . com

The addition of Shipsta is intended to help Freightos turn a profit by the end of 2026 . Shutterstock . com www . joc . com September 9 , 2024 | Journal of Commerce 19