T. Rowe Price last week joined a $119 million Series D funding round for Flexe, a Seattle, Wash.-based company, which has been dubbed “Airbnb of warehousing”offering on-demand storage space for eCommerce and other firms. The Baltimore investing giant’s funding was routed via T. Rowe Price Associates, Inc. and T. Rowe Price Investment Management, an asset management unit established in 2020.
BlackRock led the Series D round in which the other investors were Activate Capital, Madrona Ventures, Prologis Ventures, Redpoint Ventures and Tiger Global. Flexe has raised $263 million since 2013. T. Rowe Price led its Series C round of $80 million in 2020.
T. Rowe Price, which has over $1.5 trillion in assets under management, has made over 300 portfolio investments and exited 123. Its portfolio investments this year have predominantly been in life sciences sector and include: Senti, Convoy, Sionna Therapeutics, Tessera Therapeutics, Cross River, SandboxAQ, PrognonIQ, RefleXion, Rigetti Computing, Cellink, Epirus, Endeavor BioMedicines, Eikon Therapeutics, SalioGen Therapeutics and DNA Script.
Tapping into ecommerce growth
Just like Airbnb brings together tourists and home owners, Flexe’s platform matches warehouse operators with companies seeking storage space. Six of the largest retailers in the United States, including Walmart and Staples, and four of the largest consumer packaged goods companies, including Procter and Gamble, are Flexe’s customers.
Flexe’s customers use its platform principally to buy warehousing space to support their growing eCommerce business. Its on-demand service helps companies like Walmart create warehousing space close to customers, solving the proverbial “last mile” problem and cutting costs.
Considered a pioneer in on-demand warehousing space, Flexe faces growing competition as the market has expanded along with growth of eCommerce. Entrenched logistics firms such as UPS, which created a warehouse technology startup called Ware2Go, and XPO Logistics, are among Flexe’s rivals. Startups like Stord have also emerged to tap this opportunity.
Flexe has been ranked among the fastest-growing companies in North America by consulting firm Deloitte.In 2019, its co founder and CEO Karl Siebrecht was named entrepreneur of the year by EY.
Idea Came from a ‘Friend of a friend’
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Siebrecht, a former Microsoft and Bain & Company executive, co founded Flexe in 2013. He also served in the US Navy’s special operations as a diving officer.
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The idea for Flexe came from a “friend of a friend,” who manufactured varied consumer products in Asia and planned to sell them all across the United States. That led Siebrecht to evaluate the technology needed to create on-demand warehouse space. That process, he added, helped him discover what is a humongous $1.5 trillion warehousing market in the US alone.
On-demand warehousing brings varied benefits to companies. It helps businesses rapidly expand distribution and eCommerce without needing to build the space. Siebrecht believes Flexe brings cost advantages and business efficiencies, and eliminates the need to make large capital investments.