Minnesota Startup Dispatch Is Making A Run At The Courier Industry

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Screen Shot 2017-02-23 at 7.57.22 AMIt was National Doughnut Day on June 2nd, 2016.

Andrew Leone, then CFO for Johnstone Supply in Bloomington, decided to order some treats for the staff.

Leone also had another thought: he should surprise his wife, at home and pregnant at the time — what a perfect plan he had.

So he jumped online and went through one of the state’s largest courier services, placing his order and receiving an email confirmation. Thirty minutes later, the doughnut delivery showed up to his office.  He sat there waiting for a delighted call from home, popping some holes as an appetizer while surveying the landscape of options before him.

After an hour had passed with no word from his wife, he really started getting nervous. Was it the maple bar?

Finally, the package showed up at home and he received a gracious thank you call from a happy wife.

But the experience was really quite eye-opening for Leone. His wholesale distribution company literally spent hundreds of thousands of dollars on couriers annually, but never before had he personally experienced the grating drawbacks of this industry’s outdated systems.

“I couldn’t believe the lack of transparency,” he says.

“It took an hour and 15 minutes to get from our building to my house, which was 20 minutes away and there was zero communication.”

Flummoxed, he pulled out his phone to see no less than 15 Lyft cars within a few minutes of his location.  With a glazed twist now in his left he sat there for a few more minutes and thought about how much more user-friendly this process should be.

Why aren’t similar tools out there for transporting such basic goods and accessories? He wondered, now onto dessert, a soft fritter with super flakey glaze.

All hopped up on disaccharides, he called up friend and fellow entrepreneurial spirit Ryan Hanson.

Screen Shot 2017-02-23 at 8.24.53 AM

The next thing you know the two were working on a new startup, what is now called Dispatch.

“It wasn’t a pain I could feel on a daily basis,” says Hanson, who was working as a region manager for SportsEngine then. “But when I heard his company was doing hundreds of thousands per year on couriers, I figured we could channel that business through our app.”

The conventional “Uber for ______” is a tired cliche these days, but it really is the best way to explain the concept of Dispatch applied to couriers.

When there is an immediate need to move something across town, users can place an order through the iPhone app. All drivers in the area are instantly notified, and the job goes to whomever swipes first. He or she then picks up the package, takes it where it needs to go, and collects a signature on their phone (or snaps a photo confirming delivery if no one’s available). As with Uber or Lyft, the “dispatcher” pays based on mileage and can track everything in real time through a Google Maps API that displays the driver’s GPS signal.

Who drives for Dispatch? Well, pretty much anyone can says third partner and onboarder Tony Block.

“There aren’t many barriers to signing up as a courier; all you need is valid auto insurance and a vehicle that fits one of the three categories (car, mid-sized or cargo van). Drivers set their own schedule and make 75 percent of the fare for each job.”

Backed by $400K in outside capital, Dispatch launched locally at the beginning of the year and will exceed 1,000 deliveries before the calendar flips to March. Initially, Leone and Hanson are attacking the B2B space, where it’s a fairly straightforward sell, but ultimately they see a vast array of uses for their product.

“We’re building our plane in flight, but midyear we think we can add a couple of different markets,” says Hanson, who notes that the startup is already being encouraged by some national clients to expand out of Minnesota.

They have hurdles to cross – most notably the app’s iOS-only compatibility, which rules out about two-thirds of their potential market short of an Android release. But this humble endeavor is off to a strong start, and if things continue to progress well, maybe one day we’ll be all be saying “Dispatch for ______.”

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