The Future of Mobility: Accredited Investor Opportunities in Transportation Disruption

With over six hundred transportation Private Equity investment firms, the transportation industry has been forecast to rapidly grow at a rate of 3.4% up until 2027, with the global transportation market forecast to expand at a compound annual growth rate (CAGR) of 8.2% from 2022 to 2032.

Does that make it a great investment for accredited investors?

With the Legacy Capital Fund, we think so, and here is why:

According to the transportation industry trends, over ten percent of the American labor force, (around 14.3 million people), worked in the transportation and warehousing industry in 2020.

With ESG considerations as a standard measurement of performance and sustainability, profiting from transportation means more than just investing in companies with Corporate Social Responsibility (CSR) compliance because it uses electric and natural gas vehicles. It’s about the entire changing transportation and transport technology landscape.

Understanding Key Trends in the Transportation Industry

The transportation industry is undergoing significant transformations, driven by technological advancements, regulatory changes, and evolving consumer expectations. Here’s a deeper look into the major trends reshaping this sector:

• Automation

Automation in transportation refers to the use of various technologies to operate vehicles or manage transportation systems with minimal or no human intervention. This includes autonomous vehicles (AVs), drones, and automated traffic management systems.

Example: Companies like Tesla and Waymo are at the forefront of developing autonomous driving technologies. These companies are testing self-driving cars that can navigate complex urban environments without human control, aiming to increase safety and efficiency on the roads.

• Cloud Software-as-a-Service (SaaS) Systems

Cloud SaaS systems in transportation involve delivering applications over the internet that help manage logistics, fleet operations, and customer bookings without the need for internal infrastructure or IT overheads.

Example: Platforms like Fleetio and Samsara provide cloud-based solutions that allow companies to manage fleet maintenance, driver safety, and vehicle tracking in real-time, enhancing operational efficiency and data accessibility.

• Mobility-as-a-Service (MaaS) Systems
  
  

MaaS integrates various forms of transport services into a single accessible on-demand service. It offers a tailored transportation solution that can be managed from a smartphone app, combining options like buses, trains, car-sharing, and bike-sharing.

Example: Apps like Moovit and Citymapper enable users to plan and pay for multiple types of transport within a city through a single platform, simplifying urban mobility.

• Investment in Tracking Technologies

This trend involves the adoption of advanced tracking systems, such as GPS and RFID technology, to monitor the location and condition of vehicles and cargo in real-time.

Example: Logistics companies use GPS tracking to provide customers with real-time updates on their shipments, while RFID tags are used to manage inventory levels automatically as goods move through supply chains.

• Investment in Last-mile Delivery Market
  
  

Last-mile delivery refers to the final step of the delivery process where goods are transferred from a transportation hub to the final delivery destination. This segment has seen increased investment to improve speed and reduce costs.

Example: Amazon has heavily invested in its last-mile delivery capabilities, including the use of drones and electric delivery vans, to ensure faster delivery times and reduce environmental impact.

• Investment in Electric Vehicle Tech

This trend focuses on the development and integration of electric vehicles (EVs) within commercial fleets to reduce greenhouse gas emissions and dependency on fossil fuels.

Example: Companies like FedEx and UPS are transitioning their fleets to electric vehicles to meet sustainability goals. These firms are investing in electric trucks and vans, which are increasingly being used for daily deliveries.

• Renewable Fuel Standards and Impacts on Fleets and Equipment

Renewable fuel standards (RFS) are regulations that require transportation fuels to contain a minimum volume of renewable resources like biodiesel or ethanol. This trend impacts fleet operations by necessitating adjustments in fuel sourcing and vehicle technology.

Example: In response to RFS, many bus and trucking companies are incorporating biodiesel blends into their fuel management strategies. This shift not only complies with environmental regulations but also promotes the use of cleaner energy sources.

Leadership In Connecting The Dots Between Transportation And Retiring Legacy Business Owners

The Legacy Capital Fund stands out as a pioneering force in the private equity landscape, particularly with its strategic focus on the transportation sector. The fund's investment thesis is deeply rooted in capitalizing on the current economic conditions and the influx of retiring Boomer businesses. With approximately 480,000 business owners, predominantly Baby Boomers, looking to retire each year in the U.S. for the next 15 years, the market is ripe with undervalued businesses. Legacy Capital Fund is uniquely positioned to leverage this opportunity, especially in the transportation and logistics space, where it aims to acquire and enhance businesses that are undervalued due to the current high interest rates and saturated acquisition market favoring buyers.

The Legacy Capital Fund's expertise in identifying, acquiring, and scaling small to medium-sized businesses is unparalleled, particularly within the transportation/logistics sector. This focus is not only timely but also strategic, considering the sector's significant U.S. market share and the anticipated growth rates. The fund's approach involves sourcing new business acquisition deals through a robust network of business brokers and selling agents, emphasizing web-based technology and transportation/logistics spaces. By targeting businesses with underutilization of sales and marketing technology and minimal advertising, Legacy Capital aims to unlock tremendous value.

Wrap Up

Smart accredited investors strategies include working with funds to build internal teams, processes, and technology to enhance existing business models, thereby driving growth and preparing for optimal exit opportunities. With a clear focus on transportation/logistics, Legacy Capital Fund is set to make a substantial impact in a sector that is critical for the economy and ripe for innovation and growth.