In December 2023 InstaFreight, a digital freight forwarder company, filed for insolvency in the District Court of Berlin-Charlottenburg. The company has no liquidity problems but quoted excessive indebtedness and departure of one of its investors as the primary reasons for the insolvency. The company reported in the court that while its 3PL forwarding division had been temporarily discontinued, its 4PL transport management unit would operate as normal.
According to TransInfo, the above news comes after a significant financing round in spring 2022, where InstaFreight secured $40m in funding from investors such as Heliad and the European Investment Bank (EIB), as well as previous backers Shell Ventures, 683 Capital, and Rocket Internet, who had collectively invested ¬€35m in the company. Till date, InstaFreight has made total investment of €75m and its announcement of insolvency comes out as one of the biggest start-up failures of the year.
InstaFreight is a Berlin-based digital forwarder company, that was founded by Philipp Ortwein, Maximilian Schäfer and Markus Doetsch and has been in operation since 2016. It offers digital B2B transportation services that enable a fast and easy processing of freight transports. The company had over 100 employees, more than 2000 shippers, over 25,000 carriers and thousands of weekly transports.
The challenging market conditions have affected other digital forwarding companies. The logistics-led start-up companies face uncertain future as freight slump continues. This was quite evidenced by the closure of American giant Convoy, but the company’s technology found a new home with Flexport, which acquired it to reinstate services for its American customers.
Despite the difficulties, Mr Ortwein, one of the founders of the company, said “Because the business was flourishing, a restructure could resolve its issues. The company’s vision would see the business focused on digital transport management activity and noted that improving profitability in this segment rather than growth had been the company’s core focus this year.” It was also reported that potential buyers for the company are being sought.
Author: Meghna Mishra
Source: Ti Insights
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