TransVix LLC, a startup aimed at launching the first futures exchange based on trucking capacity, has moved its headquarters from Fort Worth to Chattanooga, Tenn., to leverage the city’s emerging reputation as an entrepreneurial hive and transportation hub.
According to the company, its game plan is to create a trucking-capacity futures exchange to address rate volatility, which it regards as “one of the most significant challenges in freight transportation today.”
As TransVix sees it, currently shippers, carriers and freight brokers have no effective way to protect their market exposure on the volatility of trucking spot market pricing. But by leveraging advanced technology to create an exchange to help mitigate the pricing risks associated with the $726-billion trucking industry, TransVix will “enhance the way participants currently buy and sell trucking capacity.”
The company noted that freight futures have been traded in the maritime market and listed on exchanges around the world in London, Shanghai, and Singapore. TransVix would be the first exchange in the world to focus on trucking freight.
Given that the U.S. trucking and logistics market accounts for 81.5% of all freight transportation spend, said TransVix, the futures contract market potential is “an estimated 4x multiple of the underlying market revenue, creating a $2.8 trillion market opportunity for U.S. trucking futures.”
TransVix CEO Craig Fuller said the move to Chattanooga was driven by the firm’s significant growth and desire to capitalize on the strengths the so-called “Gig City” offers. Chattanooga earned that techie moniker because of its fiber-optic infrastructure, which transfers data at ultra-high speeds.
TransVix pointed out that Chattanooga has been a startup-friendly tech and entrepreneurial hub since EPB, a community-owned provider of electric power to the area, introduced the nation's first ultra-high-speed fiber-optic connection, which transfers data at one gigabit per second – 50 times the connection speed of the national average. EPB recently announced access to speeds of 10GB, making Chattanooga the first 10-gigabit city in the world.
“Over the past decade Chattanooga has transformed into an entrepreneurial hotspot, and the city is on its way to becoming the nation’s capital of supply chain, logistics and transportation technology,” Fuller said.
“We intend to establish Chattanooga as a global hub for trucking commodities trading similar to other major U.S. cities by leveraging the Gig City's high-speed internet and deeply seeded trucking industry network,” he added.
The company also said that Chattanooga is recognized as a highly populated hub of logistics, freight transportation and 3PL companies. With three major Interstates, an estimated 80% of the nation’s freight moves through Chattanooga at some point. The area is number one in the nation for freight volume, according to Cambridge Systematics, and boasts the largest per capita basis of people involved in freight transportation among mid-sized cities.
“Our hope is that locating in Chattanooga will create a multiplier effect that will drive and motivate even more companies with interest in the freight economy to locate operations here in Chattanooga,” said Fuller. “After all, Chattanooga is the center of ‘Freight Alley’.”
Founded by Craig Fuller and a group of transportation, financial technology, and trading exchange executives, TransVix is backed by Hunt Technology Ventures LP.