Chattanooga, which originally developed in the 19th century as a railroad and river transportation hub, is becoming a trucking and logistics center in the 21st century as home to many of the nation's fastest-growing logistics companies.
A new Inc. magazine list of the fastest growing businesses in America includes a record 15 companies in Chattanooga, most of which are trucking-related companies.
"The pandemic might be the best thing that ever happened to Chattanooga commerce," said Cam Doody, co-founder of the moving company Bellhop, one of 11 logistics companies in Chattanooga on the Inc. 5000 list.
Doody, who is now helping other startups in the Brickyard incubator he helped launch last year, said in a telephone interview that the number of local logistics companies on the Inc. 5000 list underscores Chattanooga's growth as a freight hub.
"The amount of talent and money overflowing into the city, feeding straight into our dense logistics hub and growing startup scene, is pretty exciting," he said in email.
Among the local companies listed on the new Inc. 5000 report issued Tuesday, nearly three-fourths of Chattanooga's fastest-growing businesses are either logistics companies or are businesses that grew out of servicing the trucking industry when they began. The 2022 list includes the highest number of Chattanooga companies ever on the annual ranking of the fastest growing businesses in America, plus other businesses in neighboring Cleveland, Tennessee, and Ringgold, Georgia.
Companies on the list achieved three-year growth averaging 230%. The Inc. 5000's total revenue was $317.6 billion, with nearly 1.2 million jobs added over the past three years from the 695 newly founded companies that made the list, and the 2,917 repeat honorees.
On the list, are 116 companies based in Tennessee and 223 headquartered in Georgia.
"Chattanooga has a real unfair advantage with the amount of transportation and logistics knowledge in our community," said Ted Alling in an emailed statement. Alling is one of the co-founders of the freight brokerage firm Access America who has helped work with and fund other logistics startups since selling the business in 2014. "My partners and I continue to believe that the amount of companies here locally in this space is going to rapidly grow and expand here."
The fastest growing firm on the list is Steam Logistics, a freight brokerage and logistics provider that has been on the Inc. list for six consecutive years.
"While many firms are currently experiencing layoffs, Steam is experiencing record growth, opening four new branches this year in Des Moines, (Iowa), St. Louis, Kansas City, (Kansas), and Atlanta, with plans for several more," Marissa Smith, marketing manager for Steam Logistics, said in an emailed statement Tuesday.
Fastest growing businesses in Chattanooga region
The Inc. 5000 list ranks the fastest growing privately-held businesses in America based on their sales growth over the previous three years. In the 2022 list released Tuesday, 17 area companies were on the list. Those companies, and their ranking in the Inc. 5000 this year, are:Steam Logistics, ranked 531, founded in 2012, is a freight brokerage and logistics company.Trident Transport, ranked 954, founded in 2013, is a freight brokerage and logistics company.Text Request, ranked 1,598, founded in 2014, provides a texting platform for businesses to connect with customers.Network Transport, ranked 1,858, founded in 2017, is a freight brokerage and logistics firm.Logistix, ranked 1,993, founded in 2016, provides warehousing and inventory management for logistics industry.KCH Transportation, ranked 1,995, founded in 2014, is a freight brokerage and logistics firm.WAP Sustainability, ranked 2,087, founded in 2009, specializes in environmental services.SAI Interactive, known as Learning Blade, ranked 2,071, founded in 1997, provides online STEM education courses.Reliance Partners, ranked 2,138, founded in 2009, provides insurance primarily to the trucking industry.Workhound, ranked 2,441, founded in 2015, provides feedback to employers from workers, primarily in trucking industry.Seam Group in Cleveland, Tennessee, ranked 2,670, founded in 1993, provides asset management services.Sysssero, ranked 2,686, founded in 2016, provides IT services.Bellhop, ranked 2,781, founded in 2011, offers help in moving and transportation.Max Trans Logistics, ranked 3,313, founded in 2014, is a freight broker and logistics company.Taimen Trucklines, ranked 3,413, founded in 2017, is a trucking company.Ambition, ranked 4,223, founded in 2013 , is a software provider.Signal Machine Co., ranked 4,550, founded in 1983, is a metalworking and machinery supplier for the carpet industry.Source: Inc. 5000
Last year, Steam Logistics opened new branches in Minneapolis, Birmingham, Alabama, and Detroit, and hired 403 employees nationwide. In addition to adding four new branches this year, the company is building a new corporate headquarters in the former John Ross building in downtown Chattanooga.
"Even with the level of scale we have already achieved, we believe we are just getting started," Steam Logistics CEO Jason Provonsha said in a statement Tuesday. "We look forward to preparing for additional future growth as we move into our new downtown Chattanooga headquarters at the end of the year."
Trident Transport, which was the second fastest-growing business in Chattanooga among those included on the list, has been on the annual list for five consecutive years. The freight brokerage firm expects to continue to grow in the future.
"Not even the sky is the limit for us," Mark Harrell, the chief operating officer for Trident, said in a statement Tuesday. "According to Inc., fewer than 5% of companies make the list five or more years in a row – that's a huge accomplishment for us. We will continue to strive for growth, strive to be the best place to work and strive to make it on the list for the sixth year in a row."
Since Trident's first appearance on the Inc. 5000 list, the company has added branches in St. Petersburg, Florida, and Maple Grove, Minnesota.
Some of the fastest-growing companies on list migrated to Chattanooga to capitalize on the growing logistics hub.
Workhound, an employee survey and feedback provider that began in Des Moines in 2015, expanded to Chattanooga the next year after participating in the Dynamo accelerator program in Chattanooga. Max Farrell, CEO of Workhound, said in a telephone interview Tuesday that the Inc. 5000 recognition "is a really big milestone, and today is definitely a proud day for us."
Workhound started in the trucking industry to help companies better connect with and retain truckers by soliciting and providing more information from and to drivers on the road. Farrell said Workhound has benefited by coming to Chattanooga and capitalizing on its growing logistics industry.
"The smartest midsize cities are building around a thesis," Farrell said. "Chattanooga is built around supply-chain technology and logistics, so it made a lot of sense for us to have a foundation where logistics, transportation and supply chain are emphasized, and that really helped us."
Workhound has since expanded to other industries, and the company continues to grow this year with a $12 million equity investment from the New York-based Level Equity.
"There are a lot of opportunities out there for us, and we're chipping away every day to seize the moment," Farrell said. "We're actively hiring every day, and I don't see that changing in the future."
Santosh Sankar, the managing partner with Dynamo Ventures, which has worked with Workhound and other growing logistics companies, said studies indicate that one in five workers in Chattanooga are involved in some type of supply chain role.
"Today's news is a continuation of Chattanooga's longstanding heritage in supply chain," Sankar said Tuesday in an emailed statement about the Inc. 5000 listings. "The region was important to Native American traders, and as rail and road have emerged, Chattanooga has retained its importance in the North American supply chain."
The growth in logistics is leading to a number of developments in Chattanooga's downtown from companies included on the Inc. list.
In addition to the nearly $7 million renovation of the John Ross building being done for Steam Logistics, KCH Transportation is moving into two floors at the King Street Station in downtown's Southside.
KCH plans to double its Chattanooga workforce and add 400 more workers across the Southeast in the next three years. Jason Whitten, KCH's chief executive, said KCH has grown its revenues five-fold over the past five years.
While most of the local businesses on the Inc. 5000 list are in some part of the logistics industry, other area companies made the list with high-growth businesses in technology, education and manufacturing.
Text Request, for instance, was the third fastest local business on the Inc. 5000 list and has grown steadily since its 2014 start by aiding companies in sending and receiving text messages from its customers. Text Request is on the list for the second time, and company founder Brian Elrod said in a phone interview Tuesday the company's business is likely to triple again this year as Text Request grows its political business during the midterm elections and gains customers from the shutdown in the two-way text messaging business by one of its rivals, Zipwhip.
Text Request, which has 35 employees, has grown to about 4,500 subscribers and about 50,000 daily users.
"It's always good to get the kind of recognition that this Inc. 5000 list provides as we continue to grow and serve our customers," Elrod said.
Contact Dave Flessner at dflessner@timesfreepress.com or at 423-757-6340. Follow on Twitter at @Dflessner1