Weeks after laying off employees, supply chain startup Forkits has raised $30 million in an ongoing funding round, according to filings with the U.S. Securities and Exchange Commission. The filing indicated that FourKits hopes to close the round with $80 million in capital, significantly less than the company’s earlier competition, which landed around $100 million.
FourKites did not respond to repeated requests for comment.
Forkits, whose clients have at one time included Coca-Cola, AB InBev and Walmart, track and assist in the transportation of cargo by road, rail, ocean, air and package. In an interview last year, CEO Matt Elenikekal told me that the idea for FourKites evolved from his time as a supply chain consultant, working with enterprises that often struggled with the need for basic supply chain visibility.
Forekits has been largely successful in expanding its network to over 450,000 resellers and hundreds of corporate clients. But the journey has not been smooth lately.
In early August, FreightWaves reported that FourKites would lay off employees later this year and Haven Sunset, an ocean freight document management and tracking solution, later this year. FourKites acquired Haven in April 2021 to integrate the startup’s document management capabilities into a new product called Dynamic Ocean. But in an internal email, Elenjickal said Haven’s software modules are “very unprofitable.”
“The real value in procurement is having a single, global platform for all suppliers and all information. If you don’t integrate those systems, you end up with siled platforms that don’t provide much value to the customer,” Elengical told FreightWaves. “The real value for our customers comes from having a unified, user-friendly solution.” It is, so we are very strategic about how we acquire and integrate. As an industry best practice, we sunset legacy platforms after integration is successful.
Fourkeys has laid off approximately 8% of its workforce as part of the above-mentioned cuts, or approximately 60 employees in total. Most of the Forkites have focused on platforms they’ve acquired in the past two years but now they’ve built into the platform, Elenjickal told JOC.com in an interview this month, including yard management solution TrackX.
Elginical blamed economic factors such as inflation, rising interest rates and unpredictable energy prices. “Until this year, there was progress at any cost,” he told JOC.com. “Growth was divided by interest rates. Now it’s about the road to profitability. Not immediately, but we see that taking 18 to 24 months, and so let’s get it lined up on the balance sheet.
The supply chain industry has been heavily impacted in recent months as the economic situation shows no sign of turning around. Forkite rivals Sendy and Project44 laid off some of their staff this summer, as did well-capitalized supply chain and logistics providers including Stored, Convoy, Slincio and Farey.
It’s a reversal of fortunes for a sector that once seemed immune to macroeconomic headwinds. Just last year, funding for venture-backed supply chain management companies peaked at $11.3 billion, according to Crunchbase.
