The following interview is a conversation we had with Khaled Naim, Co-Founder/CEO at Onfleet, on our podcast Category Visionaries. You can view the full episode here: $42 Million Raised to Power the Future of Last-Mile Delivery

Khaled Naim
Thanks for having me, Brett. 

Brett
Not a problem. Super excited for our conversation. To kick things off, we just start with a quick summary of who you are and a bit more about your background. 

Khaled Naim
Sure. My name is Khalid. I’m a Syrian, but grew up in London and Dubai. I was in London till I was about seven and then moved to Dubai until I was 18 and then came to the US for college. Studied computer engineering and economics at the University of Michigan. And then I eventually found my way out to the west coast where I am today. Got my MBA at Stanford back in 2013 and I’ve been out here ever since. So a little more than twelve years in the Bay Area now. And I’m currently based in San Francisco. 

Brett
Have you been tempted to leave? In the media, there was a big narrative that Silicon Valley in San Francisco is dying. It’s dead. What are your thoughts? 

Khaled Naim
Our company is definitely a lot more distributed now. So we hire people all over the world, especially during COVID But even before COVID we already had started hiring remotely. So the company itself, we still have an office here. I’m at the office right now. But we did downsize significantly since most people are working from home. And so I’m pretty flexible. I kind of work from many different places. I’m still here for now, but you never mean. I do think my family is in Dubai still. My wife’s family is in Jordan. So eventually I think moving closer to home is in the cards. We just had a kid last, you know, that’s important. But I still like the Bay Area quite a bit. Except for right now. Right now we’ve got all the politicians in town with Apex, so it’s a little bit crazy. 

Brett
It’s been hectic. But hey, the streets are clean. I don’t fully understand how that’s possible. They just kind of demonstrated that they can clean the city. But they choose not to. 

Khaled Naim
That’s exactly right. Yeah. We just need an event like this all the time. 

Brett
Now I have to ask. I have a baby coming in the way. We’re like twelve weeks now, so still somewhat early. But how do you balance it all? How do you manage running a company and being a father? 

Khaled Naim
Congratulations. First of all. Is that your first? 

Brett
Yes, it’s our first. 

Khaled Naim
So super excited, super exciting. Oh, man, it’s the best. It really is the best. And words can do justice. I mean, I think, yeah. Balancing is definitely a constant work in progress. I think it’s really like ruthless prioritization when it comes to work. Like every day, I really think more carefully about what do I actually really need to get done? Because I can work endlessly in the mornings, I spend time with my son. So around breakfast time, when he wakes up, we’re hanging out for like an hour and then I head to the gym, get a workout in, and then I’m usually at the office by like 930 ish. And then I work. 

Khaled Naim
And then I kind of take a break around his bedtime, hang out with him for probably another half hour or so, an hour, and then he goes to bed and then I do a bit more work. So I found a cadence that kind of works, but I’m always trying to improve. And really what it comes down to is like, prioritization, but it’s the best. I’m so excited for you. 

Brett
Thank you, man. Yeah, I’m super excited. My friends have told me that it makes you more productive than ever before because you have to start to consolidate your work and divide up your day a little bit. So sounds like that was the case for you as well. 

Khaled Naim
For sure. Yeah. And you got better at delegating things to other people. So anything that I don’t need to do, I’ll find someone else to do it. 

Brett
Nice. Love it. Now, when it comes to your inspiration as a Founder, are there any founders that come to mind that have just really inspired you along the way? 

Khaled Naim
Yeah, I mean, tons. One that comes to mind is Brian Cheske, actually. I think he’s done a really amazing job at Airbnb, really creating this category, or I guess redefining it. I mean, it was kind of a category before with other companies in the space, but he really kind of took it to a whole new level. And they had a really difficult start at the beginning, but he stuck to his guns and really had a vision. And I think they’ve created a product that I love personally. He’s reinvented the company multiple times through Covid. I think he navigated that really well. At the beginning, it looked like it could have been an existential situation for them. But I think he navigated really well. And I really appreciate the way he prioritizes design. 

Brett
One thing I really like about them, and if you look at big ceos, everyone says we care about customers. We care about customers. And then you go and you have an experience as a consumer and it’s a total shit experience. It’s like you don’t actually care about customers. But Airbnb, he says it and then he follows through with actions to make the platform better. And he’s had a lot of conflict, I think, with hosts and things like that as he’s pushing to make it a better experience for the customer. So I admire him a lot just for that idea. He really does care about customers and his actions do follow. 

Khaled Naim
Totally. Yeah. And I think it comes from his design background. Like that kind of design thinking where you’re always in tune with the think. I think that’s probably where it comes from. 

Brett
Yeah, that makes a lot of sense. What about books and the way we like to frame this? We stole this from an author named Ryan Holiday. He calls him a quake book. So a quickbook is a book that rocks you to your core, influences how you think about the world and how you approach life. Do any quickbooks come to mind for you? 

Khaled Naim
I think when breath becomes air was one of them. That’s like a totally non business book. 

Brett
That’s a sad book. It made me sad. 

Khaled Naim
Yeah, it’s a very sad book. Really well written, but yeah, super, deeply sad and really makes you, I think about the precious existence that we have. It’s really like a fleeting moment in the grand scheme of things, and so really kind of makes you want to make the most of it. As far as business books, I think one that I always think back to was my very first real business book when I landed in Silicon Valley. It was venture deals by Brad Feld. It’s super dry. It’s not a very entertaining book, but I read it as soon as I got here and it taught me a lot about financings and term sheets and what to watch out for, what a ratchet is, what anti dilution preferences are. 

Khaled Naim
And so that one I always kind of keep in my library to look at when I need to. 

Brett
What was your plan when you arrived in Silicon Valley? Was that to just go to school? Or was it this master plan to go to school and start a company someday? What was your state of mind when you arrived here and what were your. 

Khaled Naim
Intentions when you arrived? Yeah, I definitely had the intention of starting something. I had a bunch of different ideas over time and I never really had the space, or maybe that was probably just an excuse, but I never really went for it. And this to me was like, I applied to business school, I got into Stanford and I was like, this is it. This is my time to try something. It’s the best incubator that you could ask. Know you’re surrounded by amazing talent, risk, capital, all sorts of classes and things like that. So to me it was like, okay, I’m going to do something. I actually started working on something with my Co-Founder right before I started classes. So it was like the summer before I had actually enrolled or matriculated and started classes. I reached out. 

Khaled Naim
We started kind of hacking away at different projects completely unrelated to what we’re doing, but, so I kind of started at school having already sort of started something, but were kind of messing around with some different ideas. And then a couple of weeks in, I met David, who became our third Co-Founder. He was there studying computer science, and the three of us just kind of started working on different things. And so yeah, it was my intention when I started to really build a company. 

Brett
So take us back then to 2012. What were those early conversations like when you were discussing Onfleet and what was it about this company and this problem made you say, yes, that’s it, let’s go build a company around this? 

Khaled Naim
Yeah, it’s a good question. So the summer of 2011 is when I hit up Mikhail, who’s one of my co-founders, and said, hey, I’m about to start at Stanford, have these ideas, would love to do something together. I knew him from Dubai, actually. So he was in the american school in Dubai with me for a couple of years. We overlapped and then he went to study computer science, I went to study computer engineering, and we kind of stayed in touch. And at that point we spent a couple of months trying out a opinion sentiment analysis aggregation engine where it would kind of scrape the web and pull together all this different data and try to figure out how people felt generally about various things and sort of consolidating sentiment data. So it was a lot of natural language processing and things like that. 

Khaled Naim
And so we got David, who was really, he was studying AI and ML at Stanford, really interested in that idea, and we kind of worked on that for a few months along the know. We quickly realized that weren’t exactly following the terms of services of a lot of these websites, were scraping data, so if this really got anywhere, we would have been quickly shut down. And we also got really excited about this other idea that I had growing up in Dubai. And this was really the foundation or the sort of impetus for starting eventually kind of launching Onfleet. But around like early 2012, we started this other idea or started working on this other project, which we called Addie, which was short for address. And that was rooted in my growing up in Dubai. 

Khaled Naim
Functional street addresses are quite, you know, I experienced this a lot also in my travels around emerging markets. Location communication is often really challenging when you don’t have street address system, especially back at the know, pre kind of Google map pin sharing and embedded location sharing and WhatsApp and different apps like know. When you wanted to communicate a location to somebody without a street address, you have to give know turn by turn directions using nearby marks and obscure points of interest. So if you’re inviting people over to your house, know you have a delivery person on their way, you would often get a phone call and have to explain to them. Turn left at the second roundabout, make the first right after the gas station. 

Khaled Naim
My house is the one on the left with the yellow door and the crooked palm tree out front and the old red Toyota Corolla parked outside. Et know and still today, this is the case in much of the, you know, you have Google map pins now you can share. Generally speaking, we’ve always had know coordinate systems, but those aren’t really the easiest to use in a consumer know to share with a friend or a business. And so we originally set out to solve this problem. We decided to build a URL based addressing system that would allow anyone in the world to communicate a precise location with a custom URL. And again, we called this project Addie. We incorporated the company in 2012 and we worked on this for a couple of years. 

Khaled Naim
And the idea was like anyone could go into this simple web app, you drop a pin, you create a custom URL in the form of Addie, cobrat or brethome or whatever. It’s a custom, unique URL and you could share it with friends. We had about 10,000 users kind of create and use these addies in various ways. And really the idea was eventually that businesses would accept this new sort of standard of location communication and specifically focusing on delivery. You know, throughout my MBA at Stanford, were working on this. We went through StartX, Stanford student accelerator program. We raised about half a million, and this was really our first sort of foray into entrepreneurship and we made all the rookie entrepreneur mistakes that one could make. We learned a lot, but it wasn’t really clear how we would monetize this thing. 

Khaled Naim
And we had a very difficult time getting businesses to adopt. You know, being in Palo Alto, were targeting emerging markets at the. We’re, you know, it’s not a huge problem in the US, but this is more of a problem in emerging markets. So we started with the Middle east and had a bunch of conversations with businesses there, and there was interest, but we spent a bunch of time building this product and kind of put it in front of them, and they didn’t actually end up using it. But along the way, obviously, we learned a lot about these businesses. They were mostly ecommerce and delivery businesses that were trying to kind of get on board. And really what we learned was that there was no real backend to integrate with Addie. These businesses were running on pen and paper. 

Khaled Naim
They didn’t have any technology that they were using to run their delivery operations. Meanwhile, around us in Silicon Valley, companies were emerging at the time that were really changing how mobile field workers and driver fleets were managed. And they were offering a really amazing customer experience because of their driver. You know, at the time, drivers were starting to become enabled with smartphones, and so we saw the emergence of companies around us. Like DoorDash, for example, was started by a classmate of mine at Stanford. And this was like early Uber days, Lyft. But then a whole host of other sort of on demand economy that was kind of what it was called at the time, on demand economy. 

Khaled Naim
Like apps that were popping up to allow consumers to kind of interact with the world around them with their smartphones and everything from food and laundry to flowers and all kinds of other stuff were really starting to become very delivery centric. This kind of, like retail was really shifting rapidly towards delivery. And we saw this as an interesting space for us to kind of build this infrastructure layer because all of these companies that were coming up were having to kind of reinvent the wheel and build this technology from the ground up because it wasn’t really there off the shelf. And so we, you know, maybe there’s an opportunity for us to build the infrastructure layer, the API, for the last mile delivery. And that’s what got us started. Initially, we called it track, and it was kind of like under Addie for a while. 

Khaled Naim
And then we eventually pivoted completely and shut down Addie. And the rest is kind of history. 

Brett
I would have been a paying customer of Addie. I lived in Costa Rica about 15 years ago. And my legal address there, like on my license, was 200 meters north of listed lounge, first building on the left. Something like that in Spanish, of course. But that was definitely a pain. 

Khaled Naim
I’ve heard a lot about Costa Rica, actually. Yeah, that was totally one of the markets that we would have targeted had we been successful. 

Brett
I still have friends there, and they said it hasn’t improved yet. So maybe someday you can go back and target that market and see if it works. This show is brought to you by Front Lines Media, a podcast production studio that helps B2B founders launch, manage, and grow their own podcast. Now, if you’re a Founder, you may be thinking, I don’t have time to host a podcast. I’ve got a company to build. Well, that’s exactly what we’ve built our service to do. You show up and host, and we handle literally everything else. To set up a call to discuss launching your own podcast, visit frontlines.io podcast. Now back today’s episode. Now, I want to ask a little bit about last mile delivery. 

Brett
So I feel like I’ve been reading about this now for maybe three years where everyone’s talking about the last mile delivery problem. The challenge, that’s the last hurdle to really overcome in 2012, 2013. Were people talking about last mile delivery then? 

Khaled Naim
Not as much. Not as much, right. I mean, ecommerce obviously exploded over the last decade, and a lot of our growth also was really fueled by Covid. But yeah, delivery was a thing before then, and I guess it was really mainly industry insiders that were talking about it at the time. Now it seems like everyone’s talking about it. It’s really grown in importance, and I think that it’s only going to continue. 

Brett
Yeah, that makes sense. Who is your ideal customer today? 

Khaled Naim
So today, any delivery fleet that has more than around ten drivers doing more than a couple of thousand deliveries a month are within our wheelhouse, and we have some customers doing far more than that in the tens of thousands of deliveries per day. And that’s been evolving over time. We’ve kind of been inching our way upmarket to larger and larger clients over time. In the very beginning, they were much smaller and sort of local businesses when were kind of walking around, going door to restaurants and dispensaries and pharmacies. These days, our average customer is spending over $10,000 a year with us, and some a lot more than that. 

Khaled Naim
And so we work with delivery service providers like messenger services or couriers, as well as retailers that have their own in house fleets or those that want to connect with third party fleets through Onfleet. So we also kind of help retailers that want to do last mile delivery but don’t necessarily have their own fleet. We also kind of connect them with third parties that are using Onfleet and allow them to push those deliveries out to our network. 

Brett
How many customers do you have day? Or what numbers can you share in terms of growth? 

Khaled Naim
We have about 1000 customers today, and we’re powering about a million deliveries a week for those customers. So that’s kind of our current scale today. 

Brett
How do you get customers to trust you, especially in those early days? It sounds like this is pretty high stakes, right? If the technology fails, delivers, get screwed up, customers hate them, that’s high stakes. So how do you get customers to give you a chance in those early days? 

Khaled Naim
Yeah, great point. It is certainly a mission critical operational platform. So, yeah, we can go down. If we go down, our customers can’t run their businesses. So it’s something we take very seriously. We’ve always invested a lot infrastructure, reliability, security, and it wasn’t always the case. So at the beginning were going down a lot. We haven’t been down in quite a while, but in the beginning it was definitely not the case. And so it was tough. Trust is like one grain at a time, and if something goes wrong, you kind of lose all of it at once. And so that’s one of the hardest things about building a mission critical software platform. 

Khaled Naim
But I think a lot of it kind of came down to the product market fit that we had just the need that was so strong from the customers that were talking to. We had companies that were paying us from day one with a product that barely worked, that barely had any features, just really track drivers. And there was this pull from the market that we felt that wasn’t quite there with Addie. And that was really what kind of led us to doubling down and building something. It was like companies were willing to deal with a broken product and pay us for it and give us mountains of feedback. And it was like, wow, this is really a huge problem for these folks. Let’s double down. And so that’s what we did. 

Brett
I saw you were recognized in Gartner’s hype cycle for supply chain execution technologies. Tell us about that behind the scenes. What does it take to get recognized there and featured in Gartner’s hype cycle? I know a lot of founders want to do it, but it’s kind of unknown, like what the cost is. If there’s a cost, who you even pay if it’s analyst directly or if it’s analyst relations firm. So behind the scenes, how’d you make it happen? 

Khaled Naim
Yeah, you have to pay gardener. No, I’m joking. They claim that this is very independent, and from their actual, we are a client of theirs. I don’t know if I’m allowed to say that, but I think I am. But we use them for analysis, market analysis, and getting data about the market. And so we have conversations with them on that side, and then on the other side, we do vendor briefings. So you kind of reach out to them and you give their analysts information about your company. You kind of present to them. Anyone can do that. So that doesn’t require any kind of payment. And so I would recommend, first of all, it starts with being, you have to have a product and customers that will vouch for your product. 

Khaled Naim
And I think you have to be kind of a certain scale and perhaps have more of, like an enterprise focus. But, yeah, I mean, it took us a while. We were not on any kind of Gartner report until probably like, three or four years ago. 

Brett
Yeah, to me, that seems like a very enterprise thing to focus on. So I think that’s how a lot of big enterprise organizations buy is. They just go to Gartner and they say, okay, nutella, the leaders are here, and they use that to make their decision. But SMBs mid market, I feel like they probably aren’t using Gartner in that way. Do you think that’s accurate? 

Khaled Naim
Yeah, I do. I think that’s accurate. It’s definitely more of, like, a large enterprise focus, for sure. 

Brett
Are you happy with supply chain execution technologies? Is that the category that you want to be in, or do you feel like you were kind of placed in that category? 

Khaled Naim
That’s a great question. I do think it’s appropriate. So we’re on a bunch of different reports now. So they have, like, a last mile delivery software report. It’s not quite a hype cycle. It’s more of like a market guide, I think they call them. And then there’s another one. Vehicle routing and scheduling is another one that we’ve been mentioned in as, like, a sample vendor. I think supply chain execution technologies, that’s like a super category. So there’s a ton underneath that of different subcategories. We’re pretty focused on just last mile delivery, but I would say supply chain includes everything from, like, warehouse management to cross docking, all kinds of different stuff. 

Brett
Is that hard being a part of so many different categories like, just looking at the homepage, I see last mile delivery software, fleet management software, route planning and fleet management, and then delivery operations, supply chain execution technologies. A lot of different categories there. Do you ever feel like overwhelmed, like you’re being pulled in too many directions and you want to just have one big category just to describe what you do, or do you have that? 

Khaled Naim
We were like one of the creators of this last mile delivery management software space or delivery management software. It wasn’t really a thing when we got started, but there are other kind of categories adjacent to this. Like telematics has been a thing for a long time, which is more like hardware focused, where you have this device that you plug into your truck, it’s more for trucking. But as were coming up and building the platform, were very mobile smartphone first, right? So we don’t have any hardware devices or anything like that. And were really focused on these kind of new gig fleets that were becoming a thing at the time and less so, like trucking fleets. So we kind of helped create this category and I think eventually it will become its own super category. Like WMS right now is like its own thing. 

Khaled Naim
Warehouse management software. This will be on that level in the next couple of years. But right now, we definitely do get pulled in different directions by our customers. Some of them want us to double down on sort of last mile things like routing and really level that up, and others want us to go more up the stack towards the warehouse, but we’re not doing that. We’re squarely focused on last mile delivery. 

Brett
As I mentioned, I’ve heard last about delivery a lot in the media, and I’m guessing a lot of that noise is coming from startups that are saying, hey, we’re going to solve this big, massive problem and make a bunch of money when we do it. So it seems like this is a pretty competitive landscape. How have you positioned yourself in the marketplace and how are you rising above the noise from all these other competitors? 

Khaled Naim
So there are definitely a lot of competitors, especially post Covid. So everyone kind of had the same idea, like, hey, delivery is coming a thing. Let’s build software to support that industry. Obviously, we got started quite a bit earlier, and so were very well positioned to become one of the market leaders during COVID Really what we do to stand out is just focus on our customer and focus on building the best product in the world. So we have the most developer friendly APIs, we have the most intuitive driver apps, and the best rated, too. So if you just Google Onfleet reviews or look up on our driver apps on iOS or Android App Stores, you’ll get a pretty quick sense that our product is loved by our users and we have the most user friendly dashboard and we’ve just always been product focused. 

Khaled Naim
I consider myself kind of a product guy as far as like ceos go. So I really love dreaming up the next big thing in the product and spend a lot of my energy and time there. And I think that has allowed us to stand out from the crowd. And I think that’s super important long term, to have a really solid foundation to build a business upon. Obviously, having a solid sales and support function and marketing and all the other functions is also quite important. But the product is ultimately the foundation and I think we’ve done the best there. It is a premium product, so we’re not the cheapest solution. But again, because it’s such a mission critical application, customers, especially larger ones, definitely always want to try and get the best that they can get, and that’s Onfleet. 

Brett
Playing the lower end of the market, like, playing that game, just has always scared me. And I don’t understand why people build companies that serve the super low end. So I agree with that philosophy, and I like that you’re approaching it in that way. I think that makes a lot of sense. 

Khaled Naim
Yeah. Going after the smaller folks is definitely more difficult because they churn at a much higher rate and they’re definitely more price sensitive. So we definitely have small customers and SMBs using our product, and we have sort of a pretty healthy self serve channel. So customers that kind of come in, sign up, learn the product. It’s very well documented. We have a lot of good sort of support materials and stuff like that. And so we can scale down to the low end of the market, too. But then we spend a lot of our time and energy on larger customers. 

Brett
As I mentioned there in the intro, you’ve raised 42 million to date. What have you learned about fundraising throughout this journey? 

Khaled Naim
I’ve learned a lot about fundraising. I mean, one thing I’ve learned is it just takes one. Yes, you might get 100 no’s, but it really just takes one who believes in you and your vision. So keep at it. It can be such a grind. I don’t think raising millions of dollars is the achievement. Right? I don’t think that’s any sort of achievement. I think the achievement is making millions of dollars. And if you can do that without raising millions of dollars, then it’s even better and you’ll keep your company and won’t have to report to anyone. And I think it’s especially important to just be careful or be mindful. Really understand your investors incentives and be careful about raising capital from any investor that has misaligned incentives from yours. 

Khaled Naim
So I guess that’s more than one lesson, but I’ve learned too many lessons to just one. 

Brett
Yeah, no complaints on our side for having more than one lesson shared. Same will go for this next question. So let’s imagine that you were starting the company again today from scratch. What would be the number one piece of advice or multiple piece of advice you’d give yourself based on everything you’ve learned so far? 

Khaled Naim
Probably my number one piece of advice would be to not take anyone else’s advice as gospel, I guess. So. Definitely hear people out. Advice is everywhere. It’s really overwhelming at times and often conflicting. And some mistakes just need to be made to internalize them and to develop as an entrepreneur. And that’s okay. Make mistakes, just don’t make them twice. But when people give you advice, it’s very difficult to internalize it, especially when you’re hearing conflicting advice from other people. So I guess my number one piece of advice would be to just take everyone else’s advice with a grain of salt, including my own. 

Brett
All right, so let’s zoom out. Three to five years into the future, what’s the big picture of vision that you’re building? 

Khaled Naim
Our mission as a company is to power the future of commerce by enabling businesses of all sizes to move goods efficiently and delightfully. So over the next three to five years, we’ll enable businesses to push incoming orders from consumers, typically out to their own fleets and third party networks and autonomous networks, sidewalk robots and drones, whatever mode of transportation is going to best suited to that specific order, and we’ll do it automatically. So that’s charting the five year path from here. We also want to help and continue to help our customers with soup to nuts delivery operation building. So everything from what we do today, which really kind of starts at the route optimization and really ends at the proof of delivery and the analytics that comes after each delivery and consolidating everything in one place. 

Khaled Naim
But I see us expanding more towards the driver, really helping with things like driver sourcing and payments to financial products. We want to build the hub for all things last mile delivery. 

Brett
Amazing. Love the vision. All right, Caleb, we are up on time, so we’re going to have to wrap here before we do. If there’s any founders that are listening in that want to follow along with your company building journey, where should they go? 

Khaled Naim
Definitely go to onfleet.com. That’s our website. You can follow us at know, Twitter or Instagram or, I guess, X or Instagram. And then me personally at K? Naim on LinkedIn. So first letter of my first name and then my last name. 

Brett
Amazing. Thank you so much for taking the time to chat. This has been a lot of fun. 

Khaled Naim
Thanks, Brett. Thanks for having me. 

Brett
All right, keep in touch. This episode of Category Visionaries is brought to you by Front Lines Media, Silicon Valley’s leading podcast production studio. If you’re a B2B Founder looking for help launching and growing your own podcast, visit frontlines.io podcast. And for the latest episode, search for Category Visionaries on your podcast platform of choice. Thanks for listening, and we’ll catch you on the next episode.