For the nation’s 3.4 million truck drivers, fuel costs are a huge deal. San Francisco-based startup AtoB aims to help lower them with a payment system specially designed for truckers.
While many tech startups have struggled lately, AtoB recently closed on a previously undisclosed funding round that values the company at $800 million, cofounder and CEO Vignan Velivela told Forbes. The venture funding includes $75 million in equity, led by Elad Gil and General Catalyst, and an additional $80 million in debt financing. The funding will help AtoB, which has operated largely under the radar, to expand.
“We had higher term sheets, but we decided to go with better quality investors,” Velivela says. “There’s a good healthy appetite from investors when the business model is strong.”
Three years ago, Velivela, 32, who had previously worked as a robotics engineer at self-driving car company Cruise, teamed up with Tushar Misra (ex-Uber) and Harshita Arora (who’d developed a cryptocurrency price-tracking app) to launch an Uber for buses. After Covid hit, they quickly pivoted to setting up a Stripe or Square for truck drivers.
As they traveled to trucking hubs like Stockton, California, to find out what truckers needed, they learned about fuel cards offered by Wex and Fleetcor, and thought they could do better. With AtoB, they built a dashboard where truckers could see the price of fuel, their exact fuel charges and the like, all of it connected with the fleet-tracking software. “We can use the telematics to prevent fraud and improve fuel efficiency,” Velivela says.
With a zero-fee fuel card, which offers a five-cents-per-gallon discount, gaining traction with some 25,000 trucking companies and other commercial drivers (think school buses and ambulances) and the recent launch of a new payroll product, revenue is expected to surpass $20 million this year, up from an estimated $2 million in 2021. That fast growth helped it make the cut for this year’s Forbes Next Billion-Dollar Startups list, one of 25 companies we think most likely to reach a $1 billion valuation.
“It’s one of the fastest growing businesses we are involved in,” says General Catalyst managing partner Hemant Taneja, who notes that it’s rare that the VC firm doubles down in leading a funding round as it did here. “Their go-to-market model and the way they have scaled is stunning. It’s hard to acquire that many customers that fast.”
AtoB is now rolling out a new product to help truckers cover the costs of fleet management and maintenance. And it’s working to set up bank accounts, sponsored through a bank, that are targeted at truck drivers. International expansion, starting with Canada and Mexico, is also in the works. As for the fuel card, Velivela figures that as transportation goes electric it will help truckers charge up more efficiently with less cost as well.
“We want payments to be as reliable as the Internet,” Velivela says. “That’s just not the reality in the trucking industry today because its infrastructure is antiquated.”
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