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Logistics and Supply Chain

#CountDown: 11 Days to The New York Supply Chain Meetup #02

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The New York #SupplyChain Meetup #01 – The Minimum Viable Launch
Photo Credit: Andrew Williams (@aswilliams73)

We’re now about two weeks from The New York Supply Chain Meetup’s second event. The purpose of this post is to outline our plans for that event, and preview what we expect to do over the course of the first six months of 2018 . . . We’re still in the early days of building this community, so much of this is subject to change,especially as we go through the process of recruiting sponsors.

Our Mission

To nurture and grow the world’s foremost multidisciplinary community of people devoted to building the supply chain networks of the future — starting in NYC.

Become a sponsor. Email me at: brian@tnyscm.com for more details about our vision, and the team that’s working behind the scenes to build this community.

Logistical Details: #TNYSCM #02

  • Date: Thursday, January 25, 2018.
  • Time: 17:30 – 20:30
  • Location: SAP America, 10 Hudson Yards, New York, NY.

This event will combine a Keynote Presentation, a Panel Discussion, and a Mini-Showcase. Our MC for this event is Lisa Morales-Hellebo (@lisahellebo), a member of our team of organizers.

Agenda

  • 17:30 – 17:55: Pre-event Networking
  • 17:55 – 18:00 Welcome Remarks
  • 18:00 – 18:40: Keynote Presentation, Q&A
  • 18:45 – 19:40: Panel Discussion, Q&A
  • 19:45 – 20:00: Mini-Showcase
  • 20:00 – 20:30: Post-event Community Announcements and Networking

Preview – Keynote: A Friendly Introduction to Decentralized Economic Systems, Blockchain and Other Distributed Ledgers, Cryptocurrencies, Networked Communities, and Supply Chains.

The keynote presentation will be delivered by Dr. Michael Zargham (@mZargham). Michael is the founder of BlockScience, a research consultancy that helps legacy business and industry learn about, understand, and interact with the emerging decentralized economic order. He holds a bachelor’s degree in Engineering Science from Dartmouth College, and a Ph.D in Electrical and Systems Engineering from the University of Pennsylvania. His research interests span decentralized optimization and control, network science, and operations research. BlockScience is an advisor to;

  • Sweetbridge, as it develops blockchain-based economic protocols to transform high-friction global supply chains into more liquid value networks.
  • ODEM.io, a blockchain platform that allows qualified and trusted members of the education industry to create customized curriculum and experiences and offer them directly to the market.
  • Fr8 Network, a set of decentralized applications designed to connect the freight trucking industry’s key stakeholders in order to reduce high costs and increase economic value.

The keynote presentation will last 30 minutes, with 10 minutes of audience Q&A to follow.

Preview – Panel Discussion: What Problems Are Big Companies Trying To Solve With Blockchain and Other Distributed Ledger Technologies?

Building on the keynote presentation, our panelists will explore the problems large supply chain management software vendors and large supply chain logistics providers are trying to solve, with blockchain and other distributed ledger technology, for themselves and for their customers.

Daniel James (@daniel_r_james), a member of The New York Supply Chain Meetup’s team of organizers, will moderate the panel which will last 45 minutes, with 10 minutes for Q&A from the audience.

Our panelists are;

  • Nataliya Stanetsky, manager, IT Application Security, L’Oreal. She is also a co-organizer of Women in Blockchain. Nataliya is passionate about blockchain technologies in various applications including supply chain management, identity management, and financial services. As co-organizer of Women in Blockchain she connects technologists and other professionals to share knowledge and experience about blockchain technology and its applications.
  • Kange Kaneene, director, business development, SAP Ariba, where she focuses on identifying merger and acquisition targets, establishing partnerships, and articulating SAP Ariba’s medium term strategy. During her tenure at SAP she has been in several strategic and operational roles including the office of the President for Global Customer Operations. Prior to SAP Kange was a supply chain consultant at Manhattan Associates. Kange holds a Bachelor of Science in Computer Science from the University of Michigan, and a Masters of Business Administration from New York University Stern School of Business. She loves international travel, cooking, dancing and spending time with friends and family.
  • Mahesh Sahasranaman, principal architect, UPS Supply Chain Solutions.
  • Rob Bailey, CEO & Co-founder, MState – a growth lab for enterprise blockchain companies. MState is backed by IBM, Comcast Ventures and Boldstart Ventures and invests in early stage blockchain companies that sell to the enterprise.
  • David Bergonzo, VP, Corporate Strategy for Blockchain/DLT, SAP.

Preview – Mini-Showcase

To wrap things up, we’ll hear from Ryan Robinson, a recent graduate of MIT who is trying to develop a cheaper, decentralized, cloud computing platform through his startup, Conduit.

The mini-showcase will last 7 – 10 minutes, with 3 – 5 minutes Q&A from the audience.

Testing – Community Announcements

People who attended the launch on November 16, 2017 say they’d like to hear from other people in the audience, so at this event we plan to test a “Community Announcements” segment before we wrap things up. This is an experiment, so . . . . We’ll see how it goes and iterate based on feedback from the audience.

Sponsor

This event is sponsored by SAP.io.

SAP.io helps innovators inside and outside of SAP build products, find customers, and change industries through;

  • The SAP.io Fund, a $35 million early stage fund that invests in startups that can leverage SAP’s data, APIs, and technologies to create value for their customers, and
  • SAP.io Foundries, in Berlin, New York, San Francisco, and Tel Aviv.

Preview – The Next 6 Months

Here is what the team of organizers is working on, between now and June.

  • February: A workshop focused on the tactics that non-sales business-to-business startup founders can use to go from zero to their first million dollars of sales.
  • March: A showcase of startups applying artificial intelligence to supply chain. Co-hosted with NYC Bots and Artificial Intelligence Meetup.
  • April: A panel discussion and showcase, focused on the issues that have kept blockchain and other distributed ledger technologies in the lab and out of the real world.
  • May: A showcase of startups in Fashion, Apparel, and Retail supply chain.
  • June: A Sourcing 101 workshop for startups building physical products.

Other Upcoming Supply Chain Events

  • TPM2018: TPM, part of IHS Markit is the world’s largest container shipping and logistics conference, 18 years old this year having attracted 2,300 in 2017 representing cargo owners, container carriers, forwarders/3PLs, railroads, ports, marine terminals, equipment lessors and various others. It is one of the three main annual regional container logistics organized by JOC including the Container Trade Europe event in Hamburg and TPM Asia in Shenzhen China. The programs are developed with editorial independence by the JOC team of veteran transportation journalists. I’m attending for the first time this year to moderate the Innovation Jam on Tuesday, March 6.
  • Maritime Global Technologies: Reverse Pitch on March 15, 2018 from 09:30 – 12:30. MGTIC is an initiative of SUNY Maritime College to build a global maritime technology innovation hub by bringing together all that the New York City metro-region has to offer entrepreneurs building software for the global shipping and maritime logistics market. I’m a member of the advisory board and have previously blogged about it here and here.
  • Transparency18: This is the flagship event series started by the founders of the Blockchain in Transport Alliance. It follows BiTA’s Spring Symposium, a members only event that occurs on May 21, 2018.

Update #01: January 15, 2018 at 13:21 EST to include Kange Kaneene’s bio, and preview of next 6 months.

Update #02: January 15, 2018 at 16:40 EST to include #TNYSCM Mission, and contact information for potential sponsors.

Update #03: January 18, 2018 at 22:50 EST to include SAP.io sponsorship of this event. Edit agenda to include welcome remarks.

Update #04: January 20, 2018 at 19:10 EST to include new panelists – Rob Bailey and David Bergonzo.

 

Update #01 | Towards A MaritimeTech Innovation Hub in New York City

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Maritime Global Technologies Innovation Center (MGTIC) to be hosted at SUNY Maritime College. Image Credit: SUNY Maritime College.

Note: This post updates #UnderConstruction | Towards A MarineTech Innovation Hub in New York City.

The group that met on Friday, October 6, 2017 met again for a follow up on Friday, November 10, 2017. This blog is a summary of the discussion at took place at that meeting, and the resulting outcome.

The Bottomline: Dr. Christopher Clott, ABS Chair of Marine Transportation and Logistics at SUNY Maritime College and Dr. Richard Burke, ABS Professor of Naval Architecture and Marine Engineering have announced the formation of the Maritime Global Technologies Innovation Center (MGTIC) to be hosted at SUNY Maritime College.

The people for whom this post will be most relevant are founders building software for the ocean freight shipping industry, for whom relevant resources are often sorely lacking. It will also be relevant for early-stage investors like me, who want to engage more fully with the shipping industry as we assess startups serving the maritime market.

Please note that the following descriptions are based on my interpretation of the conversations we’ve had over the course of the meetings in which I was a participant. I could be wrong. Ultimately, SUNY Maritime College and Drs. Clott and Burke will determine what will work best and I am happy to support them in bringing their vision to life.

What is the Maritime Global Technologies Innovation Center? Think of MGTIC as a hybrid between a startup incubator, a startup accelerator, and an early-stage venture fund. Obviously, these elements do not yet all exist today. The goal is to have each of these elements in place in the near future.

  • Startup ideas that originate from faculty, staff, and students of the SUNY system will be incubated at the center.
  • Startups whose founders have no ties to the SUNY system will benefit from the center’s ability to help them accelerate customer development as they search for a repeatable, profitable and scalable business model. I expect that such startups might also find employees from the SUNY Maritime College community.
  • As the center matures, we expect that it will establish a venture fund to complement its activities. Ideally, this fund will invest alongside other early stage investors in startups that have been incubated at MGTIC as well as in startups that have been accelerated at the center. Details on this will be hammered out later. For now, we think the center should replicate one of the following existing models; MIT’s The Engine, or the Iowa Global Insurance Accelerator, or Texas Capital Factory. Perhaps, MGTIC will take the best elements of each of those models and combine them into something wholly unique.

What will The Maritime Global Technologies Innovation Center do? SUNY Maritime College is an educational institution, so that characteristic forms the foundation on which MGTIC exists. That said, the global maritime industry confronts numerous headwinds such as; artificial intelligence, autonomous vehicles, increasing issues around regulatory compliance, offshore sources of renewable energy, safety, connected devices, cloud-computing, cybersecurity, and blockchain and other distributed ledger technologies present challenges the shipping industry must grapple with sooner or later. Maritime Global Innovation Center’s goal is to lead the effort towards turning these perceived challenges into profitable opportunities for incumbent players in the industry AND for technology startups developing innovations that the industry can adopt. As an early-stage investor who has been studying startups building software for the maritime market, I can’t express how excited I am to be able to collaborate with an entity like MGTIC.

Nice! What’s Next? At our meeting on November 10, we agreed to plan a kick-off event on Thursday, March 15, 2018 at SUNY Maritime College. If maritime technology holds any interest for you, please save that date. We hope to convene a group that represents each of the stakeholder communities that MGTIC is being established to serve. It will coincide with the Connecticut Maritime Association’s Annual Conference and Exhibition. We’ll have more specific details about the kick-off later.

For more info:

  • You can email the crew at SUNY Maritime College that’s working directly on this via the MGTIC’s website – see link above.
  • If you’re an early stage VC interested in staying abreast of how things are progressing, you can reach me via email/Twitter/LinkedIn, and I’d be happy to answer any questions you have about this – to the best of my ability. I’m also looking for angel investors and VCs with whom we can co-invest.
  • If you’re a startup founder who wants to hear what other founders think about this “thing” – Brian Wilson from Duro UAS, Fauad Shariff and Petere Miner from CoLoadX have attended both meetings so far and can give you their take about where they feel things are heading.

Other initiatives focused on maritime technology, or supply chain technology more broadly – Leonardo Zangrando of Startup Wharf has a more complete listing here;

Last, I’m gonna plug related work I have been doing with a team of 7 other supply chain enthusiasts in New York City; We launched The New York Supply Chain Meetup with a minimum viable launch on Thursday, November 16, 2017 at Work-Bench. We hope to do much more in 2018, and we hope you will decide to join us, after all “The world is a supply chain.” and as a result, there are things to discuss.

 

Progress Report | #TNYSCM Minimum Viable Launch – Building A Supply Chain Community

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Design by: Lisa Morales-Hellebo

The New York Meetup #01 – The Minimum Viable Launch November 16, 2017

On November 16, The New York Supply Chain Meetup reached an important milestone – we held our first event.

This blog post will trace how we got here, and share some pictures from our minimum viable launch. We hope you’ll join us in our bid to bring the global supply chain community together, starting with this small step in New York City.

This is the story of how we got here.

On August 23, I arrived at my desk at KEC Ventures and while drinking my cup of coffee, I thought to myself; “I really should go to the supply chain meetup in New York.” I have been thinking about value chains and supply chains since 2014. Evidence of that is documented below;

  1. Why Tech Startups Can Gain Competitive Advantage from Operations – August 2014
  2. Industry Study: Freight Trucking (#Startups) – November 2016
  3. Updates – Industry Study: Freight Trucking (#Startups) – December 2016
  4. Industry Study: Ocean Freight Shipping (#Startups) – February 2017
  5. Cargo Drones and Data Swarms: Experts Weigh In on Digital Transformation in Shipping & Maritime – March 2017
  6. Updates – Industry Study: Ocean Freight Shipping (#Startups) – June 2017
  7. White Paper | Towards A Supply Chain Operating System – August 2017
  8. #UnderConstruction | Why A Supply Chain Meetup in New York? – September 2017
  9. #UnderConstruction | Towards A MarineTech Innovation Hub in New York City – October 2017
  10. Update #01: White Paper | Towards A Supply Chain Operating System – October 2017

So, on August 23, I ran a query on Meetup.com for a supply chain meetup in NYC. I was surprised to see that there wasn’t one. Without thinking, I took out my credit card and registered The New York Supply Chain Meetup. After realizing what had just happened, I thought “Fuck! Now what?”

I figured I’d take my time and figure out what to do. I wrote a post on my Facebook page, about what I’d done. Thinking, there’s no rush . . . I can let this sit for a while.

Don’t Wait, Just Do it

The following morning I got a message from someone on LinkedIn . . . I am connected to more than 14,000 people on LinkedIn, so one of them sent me a message; Hi Brian! I saw your post in Mattermark Daily, looking forward to it. Great idea!

I panicked; “What? I did not send a submission to Mattermark yesterday. What is he talking about? I should go check.”

As I had started to fear, somehow my Facebook post had been flagged by Mattermark and they’d included it in the roundup of notable posts from venture capitalists.

So, what’s the problem? Well, Mattermark Daily goes out to 100,000 – 150,000 people daily – possibly more, I have not checked the numbers in a while. Basically . . . Tens of thousands of people had now been told that I was going to do this. I couldn’t turn around and say . . . “Ha ha ha . . . Nevermind, I was just kidding.”

So, I called Lisa Morales-Hellebo when I got home on August 24, and asked if she’d help me. I did that because she and I have been talking about supply chains in fashion and retail since May 2016. She knows more about the intersection of supply chain, technology, fashion, and retail than anyone else I know personally, and she’s been working on those issues since 1996. She agreed to become a co-organizer.

Also, on August 24, Brian Lindquist sent me a message through Meetup.com because my friend, Ed Sim, at BoldStart Ventures had told him to come chat with me. Brian has 10+ years of experience in operations / supply chain and spent the past 4 with A.T. Kearney in their Strategic Operations Practice leading COO-level engagements with various F1000 CPG companies. We chatted in person in early September and he too agreed to join me and to become a co-organizer.

Also, on August 24, Allie Felix from Work-Bench reached out to me. They’d seen the Facebook and she wanted to speak with me about how Work-Bench might help me get the meetup off the ground. Given what Work-Bench has accomplished in building The New York Enterprise Technology Meetup . . . I felt that was a good sign. I felt bad about my conversation with Allie a few days later, because I did not yet have any answers . . . I had no clue what was going to happen. But she was very patient and supportive, and told me that Work-bench would be happy to host us once we got going.

Not long after my meeting with Allie, Tina Kang, Daniel James, Paula Cadman-Mendoza, Santosh Sankar, and Joy Fan also agreed to join the team of organizers to try to bring The New York Supply Chain Meetup to life. We met later in September to create a plan and decided we’d have a kick-off on November 16. We then set to work.

Our goals;

  • To create a multidisciplinary community of practice around building 21st Century supply chains and value chains,
  •  To create a forum that brings together big corporations, small and midsize companies, and startup to enable them do business and partner with one-another,
  • To explore the latest research in the area of supply chain, and industrial transformation through digital technologies.

Building on the unique characteristics of New York City, #TNYSCM will become the world’s foremost multi-disciplinary community of practice for individuals and organisations committed to investigating and developing solutions for problems in global supply chain networks at startups, large corporations, academic institutions, and everything in between. A particular area of interest is the use of distributed ledger technologies, and other cutting edge technologies, as a foundation for innovation in supply chain networks.

#TNYSCM | The past ran on supply chains. The present runs on supply chains. The future will run on supply chains. The world is a supply chain.

Below, some stats on our progress so far, and pictures from our minimum viable launch on November 16, 2017 at Work-Bench.

Members: 350

RSVPs for November 16: 214

Attendance (Approx): 150, about 100 stayed till the very end.

Presentations: 7, one presenter could not make it at the last moment, due to an unexpected illness.

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Work-Bench was empty at first, though a few people showed up 30 minutes early, around 5:00 PM.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Before things got hectic – showing off a little bit with John, and Tina.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Esma’s enthusiasm for her new favorite shirt is a good sign. She’s a supply chain engineer.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | It’s time to show our work, and we are happy to do so – Daniel James and I show off for the camera. Daniel works at IHS Markit, and is one of the 8 people who worked to make this possible.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | John Azubuike mans the sign-in desk as Marc Held from Armada arrives. March came from Boston, MA. He was one of the presenters for the evening.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Lisa Morales-Hellebo is the first person I called after I realized there could be no turning back. That was on August 24, 2017.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Hyder is visiting from Dynamo in Chattanooga, TN. Dynamo invests in Logistics, Supply Chain, and Transportation. He seems suitably impressed so far.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Lisa Morales-Hellebo, Daniel James, and Tina Kang . . . all members of #TNYSCM leadership team, and all meeting for the first time.
In the background, Ryan Smith, founder of FTSY.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | NIcole Gibbons met Michelle and Kimberly at the sign-in desk and they got to talking about supply chain logistics . . . Michelle and Kimberly work at UPS.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | I manned the sign-in desk all evening, with intermittent help from the other organizers. I wanted to be able to say “Thank you for coming.” to every single person who came to the event.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | #TNYSCM “The world is a supply chain.”
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | This would not have been possible without the leadership team. From R – L; Lisa Morales-Hellebo, Tina Kang, Daniel James, Santosh Sankar, Paula Cadman-Mendoza, Brian Lindquist, Brian Laung Aoaeh, and John Azubuike – my teammate from KEC Ventures who gave us a hand for the launch. Joy Fan could not make it.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Lisa Morales-Hellebo, our MC for the night.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Allie Felix and the rest of the crew at Work-Bench believed in the idea of #TNYSCM even before I had a clear idea what it should be. I can’t thank them enough.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Veronika Harbick from Thursday Finest got the ball rolling for this showcase. Thursday Finest does custom and on-demand 3D knitting.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Fauad Shariff from CoLoadX talks about building the digital platform for ocean logistics – a massive undertaking in a massive market.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Marleen Vogelaar from Ziel talks about digital fabrication, and on-demand, environmentally responsible clothing manufacturing.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Rodney Manzo from Anvyl explains what Anvyl is doing to remove friction in supply chain so that anyone can make products.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Marc Held from Armada talks about bringing true global transparency to supply chain with intelligent visibility and predictive analytics.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Benita Singh from Le Souk talks about building a platform that enables designers to search, sample, and source quality materials direct from original suppliers.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Suuchi Ramesh from Suuchi, Inc. talks about building and scaling the apparel manufacturing supply chain of the future.
Photo Credit: Andrew Williams (@aswilliams73)

 

The New York #SupplyChain Meetup #01 – The Minimum Viable Launch | Lisa, our MC for the night, wraps things up.
Photo Credit: Andrew Williams (@aswilliams73)

Some of the comments since the event;

Fauad Shariff, co-founder & ceo of CoLoadX says;

Once again, great job pulling together the meetup last night Brian & Lisa.  The turnout exceeded expectations, and I’m sure at least a few customer and biz dev relationships came out of it for us and some of the other companies. I also wound up connecting with some folks from the industry whom I hadn’t seen in a while, or only knew of from social media. Looking forward to more chances to get together with the community.

Esma Hamandi, a supply chain engineer who recently moved to NYC says;
I moved here to NYC recently and I didn’t know where or how to connect with people in the same professional field as me until you let it happen.

This would not have been possible without the support of our sponsors;

  • Work-Bench – believed in what this could become even before it was clear that there is a need for a community like this. They offered us use of their space for free.
  • CustomInk – Gave us a steep discount on t-shirts and hoodies. Use the discount code: TNYSCMCI for your own orders from their website. You’ll get 10% off for orders of 6 or more items.
  • UPS – is helping us cover the cost of food and refreshments.

We’re in the process of gathering data to help us plan for 2018. We should have a tentative plan before the end of 2017. We hope you’ll join us.

Update #1: Wednesday, November 22, 2017 at 18:54 EST.

  • Minor edit – punctuation mark.
  • Add #TNYSCM Header image.

#CountDown: 8 Days to a Minimum Viable Launch

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Showing it off! Brian sporting a #TNYSCM t-shirt.

After a few years of thinking about startups building software for trucking and shipping, and more recently, distributed ledgers and supply chains, on August 23, I thought to myself “I really should attend the supply chain meetup in NY.”

I was surprised to discover that no such thing existed. So, without thinking, I took out my credit card and registered The New York Supply Chain Meetup on Meetup.com.

We’re now barely 8 days away from our minimum viable launch. I hope you decide to join us.

Blurb about #TNYSCM

The New York Supply Chain Meetup is a community of practice for people developing solutions to supply chain problems at startups, large corporations, academic institutions, and everything in between. The focus is primarily on the application of cutting-edge technologies to global supply chain innovation. Join us for our first event at Workbench on November 16, 2017. Our estimates suggest we’ll have at least 60 people present.

Retweet: https://twitter.com/brianlaungaoaeh/status/917212173893603328

#TNYSCM

“The past ran on supply chains. The present runs on supply chains. The future will run on supply chains. The world is a supply chain.”

Follow The New York Supply Chain on Twitter @tnyscm.

A version of this article was first published on LinkedIn, on November 8, 2017.

#UnderConstruction | Why A Supply Chain Meetup in New York?

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Image Credit: Tasha S. K. Aoaeh

The goal of this blog post is to explain why I believe strongly that New York Needs A Supply Chain Meetup. You can join The New York Supply Chain Meetup here.

By many estimates, supply chain inefficiencies impose significant overhead costs on corporations, and on the world as a whole. When one reads about the global systemic problems that people at the United Nations, The World Bank, The World Economic Forum, The G20, and other multinational bodies are thinking about and trying to solve, the theme of supply chain inefficiency cuts across all the problems. This is a big problem – I will try to outline the size of the problem in a separate post.

According to Martin Christopher a Supply Chain is;

A network of connected and interdependent organisations mutually and co-operatively working together to control, manage and improve the flow of materials and information from suppliers to end users.

– Martin Christopher, Logistics & Supply Chain Management: Creating Value-Adding Networks, 4th ed, Pearson Education Limited 2011, page 4.

As the definition above indicates, for supply chain networks to function effectively there must be an ongoing flow of goods, information, and funds in the form of money.

Human civilization has been built over time through this movement of goods, information, and funds. As I put it;

The past ran on supply chains. The present runs on supply chains. The future will run on supply chains. The world is a supply chain.

To move all the stuff people need everyday around the world, people in many different areas of expertise must work harmoniously together. Furthermore, technology platforms associated with these different professional disciplines must work to enable the flow of goods, information, and money. Here’s a small sample;

  • Purchasing and procurement,
  • Supply chain management,
  • Supply chain finance,
  • Trade finance,
  • Risk management,
  • Regulations and compliance,
  • Corporate banking,
  • Transactional banking,
  • Corporate treasury,
  • Insurance,
  • Customs and excise,
  • Payments,
  • Contract law,
  • Trade law,
  • Etc.

The technology developments of the 21st Century present us with an opportunity to make a significant dent in this problem. New York has a unique capacity to lead global efforts to solve this problem. Why?

  • In 2016 New York had total exports of $74,406,138,530, and
  • In 2016 New York had total imports of $130,179,226,114.
  • There are nearly 40,000 businesses in New York that sell products overseas, of which 94% are small and medium-size companies which accounted for 53% of the export volume.
  • New York’s top-ten export partners are Canada, Hong Kong, Switzerland, the United Kingdom, Israel, Belgium, India, Mexico, China, and France.
  • New York’s top-ten import partners are China, Canada, India, Switzerland, Israel, France, Italy, the United Kingdom, Germany, Belgium. 1Data from: https://globaledge.msu.edu/states/new-york/tradestats. Accessed on Sep. 10, 2017.

To be able to support this volume of trade with the rest of the world, there must be a lot people in New York who directly or indirectly know a lot about the things that keep supply chains humming.

So, the goal of the meetup is to bring these people – experts and novices alike – together, on a regular basis to;

  • Promote entrepreneurs working on solving supply chain problems,
  • Hear how mature companies in different industries are solving their current supply chain problems and planning for the future,
  • Nurture collaboration between mature companies and startups to enable the implementation of promising supply chain platforms in the real world,
  • Explore what new technologies can do to hasten dramatic efficiency gains in global supply chain networks,
  • Promote academic research on topics related to increasing supply chain efficiency,
  • Engage public policy experts and regulators on issues related to supply chain . . . and other things I have not thought of yet.

It’s early days – the meetup is not yet even a month old, and has fewer than 70 members as of a few minutes ago. We have not yet had our first meetup. Fortunately, Lisa Morales-Hellebo, Brian Lidquist, and Paula Cadman-Mendoza have volunteered to assist with getting the meetup organized. Still, it will take a lot of effort. Fortunately, supply chains are not going anywhere and fixing the problems that make them inefficient will require a concerted team effort.

 

 

 

References   [ + ]

1. ↩ Data from: https://globaledge.msu.edu/states/new-york/tradestats. Accessed on Sep. 10, 2017.

Updates – Industry Study: Ocean Freight Shipping (#Startups)

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Note: This article does not necessarily reflect the opinion of KEC Ventures, or of other members of the KEC Ventures team.

Supplying the world with nearly everything is an enormous and complex job: there are things to discuss. 

– Rose George (2013-08-13). Ninety Percent of Everything: Inside Shipping, the Invisible Industry That Puts Clothes on Your Back, Gas in Your Car, and Food on Your Plate (p. 142). Henry Holt and Co.. Kindle Edition.

Our blog post about startups building software products for the shipping industry generated more interest than I anticipated. Unfortunately, some readers got the impression that we intended to focus more on containerships than on the bulk shipping segment of the industry. That was not our intention, and so I promised I’d spend more time digging into the bulk carrier portion of the market when I published an update.

This blog post will not make any sense if you have not already read Industry Study: Ocean Freight Shipping (#Startups) – which I co-authored with John Azubuike. Also, reading this post or the preceding one will be a waste of time if you do not have a strong interest in shipping, AND in early-stage technology startups building products for the shipping industry.

KEC Ventures is an institutional seed-stage venture capital fund based in New York. We invest between $500,000 and $1,000,000 in seed-stage startups building software products. We have been doing this since 2011. 1For logistical reasons, we are currently focused on investing in startups based in the United States and Canada.

Together with our new teammate Dylan Reid, John and I have a strong interest in supply chain and logistics startups. We think of shipping and trucking as essential components of that landscape, and so we seek founders building startups in that market. We are also eager to connect with industry insiders with whom we can start building a relationship and hopefully collaborate in the future.

You can reach us at;

With those preambles out of the way; on with the show.

What is the relative size of the Bulk Shipping market?

The following chart shows the distribution of commodities traded by sea. It is based on data from The Tramp Shipping Market, a March 2015 update to an earlier report for the European Community Shipowner’s Association prepared by Clarkson Research Services. It is pretty self explanatory; By gross tonnage energy is 38%, metals is 25%, container cargoes 15%, other industrials 12%, and agricultural goods account for 10% of all goods traded by sea. 2Tramp shipping is a combination of the traditional bulk shipping segment with the specialist shipping segment of the market. So in this case one could argue that bulk shipping accounts for 85% of the market.

For underlying data see; The Tramp Shipping Market, March 2015, Clarkson Research Services

The next chart is based on data from the same report. This time it shows the distribution of investment capital in the freight shipping market. It is pretty self explanatory; Tankers account for 27%, bulk carriers 37%, gas 12%,  and containerships 24%.

For underlying data see; The Tramp Shipping Market, March 2015, Clarkson Research Services

Additionally, Europe accounts for 36% of gross tonnage in the shipping market and 40% of global investment capital into shipping.

This data appears to confirm a comment we heard from several founders building software for the bulk shipping segment; I am paraphrasing – Investors and the public seem to only be interested in containerships but the bulk shipping market is a significantly bigger portion of the market. 3For the purposes of this post it does not make much sense to segment the bulk shipping market more finely, but it is worth noting that liquid bulk and dry bulk differ in some important ways.

However, the authors of The Tramp Shipping Market point out that in terms of value of goods transported containerships account for nearly 50% of the market. There is no contradiction; bulk ships mostly carry raw commodities that are required inputs for finished goods that consumers and businesses then buy at a significant markup to the total cost of all the input goods, materials, and labor. It makes sense that people know more about the ships that bring their smartphones, sneakers, jeans, and coffee than they do about the ships that transport the cobalt that is in their smartphones and the raw cotton that is used to make their jeans.

What are the biggest opportunities for startups?

This is an interesting question because the answer depends quite a bit on the perspective of the person answering the question. I attended the Connecticut Maritime Association’s Shipping 2017  in Stamford, CT and I was surprised by the number of software vendors offering products for gathering, analyzing, and interpreting data. It makes sense that there’s a large appetite for data; shiping is a complex process that functions effectively based on coordination between many different parties.

Among the startups John and I studied between September 2016 and February 2017 while we were learning about the shipping industry we observed the following themes;

  1. Many startups are building platforms to connect people who need shipping services with parties that can provide the service, or to enable various counterparties in the industry to collaborate with one another on some issue. So far many of those have operated in the containership segment of the market. However, a couple have started to build platforms, often marketplaces, specifically for the bulk shipping market. Shipamax and VesselBot are two examples of startups that are building specifically for the bulk shipping market. 4This is not necessarily a completely new business model in the shipping industry since shipping portals like INNTRA, CargoSmart, and GT Nexus have existed for more than a decade.
  2. Other startups are building software platforms for gathering, analyzing, and interpreting data for the shipping industry and industries that depend on data related to shipping. Startups in this category which sell primarily to ship operators generally build products that bundle a hardware device with software – no different from the sorts of products that vendors at the CMA’s Shipping2017 Conference were publicizing. In fact a couple of the vendors at the conference were hyping new cloud-enabled versions of their products. I left the conference with concerns about how a startup would differentiate itself from these incumbents. In my opinion Windward seems to be the startup best placed to displace existing incumbents, however it does not appear that Windward is focused on bulk shipping only. Nautilus Labs solves the same problem problem, but is much younger than Windward. 5Nautilus and Windward do quite different things, but both fall within this broad category.
  3. One product that it appears the industry would gravitate towards is a system of record that connects all participants in the supply-chain, from end-to-end. This would be a platform into which various shipping industry data could be input, and other data can be obtained as outputs . . . Probably most input data would come from other platforms and data repositories, while output data would be fed to different counterparties based on their access rights and information requirements. It seems to me to be a problem suited for a cryptographically-secure, lightweight, multi-tenant, cloud-based ledger or database of some sort that can also provide anonymity for market participants who wish to maintain some level of secrecy from other counterparties with whom they interact through the platform. One can imagine that governments around the world, for example, would want special access rights in order to keep tabs on the movement of goods and people from one place to another. 6Another example, a company like Cargill might want to protect data about how much of a given commodity it is buying from its competitors although it might be willing to provide its own data as an input in exchange an output sith summary statistics related to its industry and the markets in which it does business.

You can find other ideas about what the future of shipping might look like here; Cargo Drones and Data Swarms: Experts Weigh In on Digital Transformation in Shipping & Maritime, which was published in KNect365 Maritime in March 2017.

What threats does a technology startup face in selling its products to customers in the bulk shipping industry?

While we were studying the freight trucking market and startups building software for that market we came across Debra T. Johnson’s concept of “invisible barriers to innovation” . . . It appears to me that the issues she described might be even more acute in the shipping industry. There are sales barriers, product barriers, and customer barriers which make it considerably more difficult for startups to gain traction in the shipping market than in other markets that startups typically pursue. For this reason one of the things I look for on a team of startup founders building products for so-called legacy industries is that at least one member of the team has deep industry expertise and has a network that will make it considerably less difficult to overcome the invisible barriers that the startup might face as it attempts to find product-market-fit.

Another issue that makes shipping in general different from other industries with which startup founders might be more familiar – in the shipping industry the unit of competition is the individual ship . . . We discussed this in our original post on shipping. Each ship is operated as if it were an independent organization onto itself – which is true in many respects. I do not know how this affects which sales strategies are most effective for vendors selling tech products to shipping companies. I’m working on figuring that out, but one thing I can say is that the startups that can solve that puzzle comprehensively have a better chance of winning market-share over their peers who do not have an understanding of that phenomenon.

But, all is not lost. There is hope; Demographics.

Shipping is one of the handful of industries globally that approaches the theoretical model of perfect competition that students of microeconomics study in college. That means that profits margins are consistently being squeezed, that the threat of new entrants is consistently high, and that intra-industry competition is acute. However, a new generation of executives is entering the industry. These executives are tech savvy and have gained experience in other industries and now want to try new approaches to running shipping companies in ways that they expect will increase their market-share and improve their profit margins.

I will describe one example.

Mark Hassell and I were colleagues at UBS in Stamford, CT for a short while. He spent slightly more than a decade at UBS Investment Bank where he traded exotic derivative products. After leaving UBS he spent some time working at a couple of startups in San Francisco.

Mark’s family has been in the shipping business in Barbados for several generations. Eric Hassell & Son Ltd. is a family-owned group of companies all focused on shipping and logistics with clients that represent containerships, bulk shippers, NVOCCs, research vessels, specialist shippers, and cruise ships. Mark decided to head back to Barbados in early 2016 after he learned of all the opportunities his cousin, who is presently CEO of the company, felt Eric Hassell & Son Ltd could pursue if she had some more help at the executive management level within the company.

Mark now runs strategy, business development, and corporate development at Eric Hassell & Son Ltd. When we spoke about the shipping industry in March, about a month after we published our article, he said the company had grown revenues by about 20% in 2016 – a significant jump over their performance in 2015. He feels they can repeat, or perhaps improve on that performance in 2017. He is eagerly searching for solutions that will enable EHS to reduce operating costs and grow market-share and revenues at a double digit rate for the foreseeable future.

Business is fascinating right now. The local Barbados economy is on its last legs before some IMF-style austerity measures get implemented so I’m in the process right now of thinking about diversification, while still protecting our core business from increasing competition. I’ve been traveling quite a bit regionally – a lot of fact finding and conferences. I’m finding much more insights in face-to-face conversations than via reports and emails.

– Mark Hassell, via email, June 19, 2017 7Mark’s comment drives home the fact that the shipping industry’s economic fortunes are very much tied to global business and economic cycles.

In shipping, and also in trucking – and I have observed the phenomenon in construction too, there’s a generational change taking place. Younger family members like Mark are taking over executive management responsibilities from an older, less tech savvy generation. This new cohort of executives have seen the competitive edge that technology can confer on companies that have ambitions of breaking into the upper echelons of their industry, AND, they have the skill and know-how to deploy technology effectively . . . If I were a startup founder, these are the executives I would be approaching and building relationships with from the outset. Often, these executives do not yet run the businesses that their families own, but they play influential roles in determining what path those businesses will follow in the future . . . and it is often a technology-enabled path.

Lest you think the phenomenon I have described above is restricted only to family-owned companies, INNTRA is undergoing a similar shift in management as well as strategy – according to Greg White, INNTRA’s global head of strategy and business development. What does INNTRA do? INNTRA describes itself as the largest neutral electronic transaction platform and, software and information provider at the center of the ocean shipping industry. It began life as a division within A.P. Moller-Maersk Group, the largest ship operator in the world.

To close this update, I will end with some issues that John and I have encountered as we have spoken with startup founders and shipping industry insiders about the industry; 8We would love to speak with you if you have a perspective on any one of these issues as it relates specifically to shipping. They are issues we expect to be thinking about for a long time.

  1. Can technology completely replace human intervention in shipping, can a technology platform solve the trust issue in shipping? 9Complaints that brokers add no value are common.
    • Jenna Brown at Shipamax, Mark Halsell, and Constantine Komodromos at VesselBot think the answer is “no”. They argue that rather than being eliminated completely, as software platforms become more reliable and sophisticated, human intervention will shift from routine but time-consuming tasks to complex issues that require more nuanced judgement and to which there is no straight-forward answer because of the associated trade-offs that have to be made. 10This debate is one that is ongoing in the trucking market too. There are many startup founders who say they expect to cut brokers out of the picture altogether. I think the reality is more likely to resemble what Mark, Jenna, and Constantine predict.
  2. This is one of those industries in which relationships matter, and so in order to gain early traction and achieve product-market-fit startup founding teams need to;
    • Know the industry and its segments,
    • Be known to, and gain the trust of industry insiders, and
    • Understand the nuances of the industry’s relationship to technology and software.
  3. Efficient scale could be a challenge for startups selling products to customers in the ocean shipping industry. Investors should invest time understanding how startup founders intend to overcome that obstacle, if it exists.
  4. Maritime law is complicated, and can be opaque for people who are unfamiliar with its peculiarities. This is a point that was raised as a concern by Michael Rainsford, a former derivatives trader at Morgan Stanley who now advises a number of startups in shipping, trucking, and derivatives. It is unclear how the peculiarities of maritime law will affect software startups that do business with ocean shipping companies.
  5. Fuel efficiency is a big problem for the global shipping industry, but not enough people are talking about it. This is a point of view expressed by Ted Shergalis – a co-founder, and the chief operations officer at Magnuss.  Magnuss adapts wind-powered propulsion technology whose underlying principles were first discovered by the German physicist, Gustav Magnus in 1853. Magnuss marries its hardware with software to generate fuel savings of up to 50% – according to the founders. This is a big deal in the bulk shipping market since fuel costs represent 60% – 70% of operating costs – according to Magnuss founders. 11I have not been able to find data on operating expenses in the shipping industry comparable to what I found for the trucking industry.
  6. One danger that startups building technology for the shipping industry can encounter is the problem of investors who do not understand the nuances of the shipping industry, and so might try to persuade early-stage startup founders to adopt strategies and tactics that the venture capitalists have seen work in markets that are more traditional hunting grounds for early-stage investors. These strategies may very well work when the startup is much more mature, but they can backfire if they are adopted too early. This is an observation that was expressed by Bill Dobie, a technologist who has been building software for the shipping industry since 2000. John and I heard comments along a similar vein when we studied startups building software for the trucking industry.
  7. I expect that we will see more specialized accelerators like Port XL emerge to support founders building startups that are regionally-focused – say, for example, a competitor to Flexport that is primarily focused on serving a customer base in Asia, the Middle East, Australia and New Zealand.

With an estimated $4.5 trillion-plus in capital required to finance transportation assets over the next 10 years, this is a large-scale and wide-ranging investment opportunity.

– Anton Pil, Managing Partner, JP Morgan Asset Management. 12See; JP Morgan Asset Management secures $480m for new shipping fund, Sam Chambers, Splash 24/7. Accessed on June 20, 2017.

Ocean shipping is an enormous industry . . . By one guess the opportunities in the industry are large enough to support 10 billion-dollar-plus startups. I’m assuming that Flexport has one of those spots firmly in its grip. Perhaps Windward has a strong claim to another. That leaves 8 or 9 opportunities to create a billion-dollar-plus startup focused on ocean shipping.

We are eager to find and invest in as many of them as possible. We’d love to talk to you if you are based in North America and believe you are working on an idea that has the potential to transform the shipping industry to enable it to meet the challenges our world will encounter over the next 50 – 100 years. Even if you are not based in North America, but happen to visit New York sometime in the future we’d be happy to meet for coffee and hear about your experience, if you have some free time and want to chat.

You can reach us at;

Update: June 20, 2017 at 17:13 to change “Vesselbot” to “VesselBot” based on email from Constantine.

Update: June 20, 2017 at 17:30 to include quote from article about JP Morgan Asset Management’s new shipping fund.

Update: June 20, 2017 at 17:50 based on call with Jenna Brown at Shipamax.

Update: June 20, 2017 at 18:20 based on email from Jenna Brown re: marketplaces vs. platforms and Windward vs. Nautilus. Added footnotes.

Update: June 21, 2017 at 09:45 based on corrections from John Azubuike.

Update: June 21, 2017 at 12:15 to include link to MEPC70 announcement about IMO regs on low SOx, NOx, and CO2 emissions.

Update: June 22, 2017 at 09:20 based on June 21, 2017 email from Mark Hassell re: EHS corrections.

References   [ + ]

1. ↩ For logistical reasons, we are currently focused on investing in startups based in the United States and Canada.
2. ↩ Tramp shipping is a combination of the traditional bulk shipping segment with the specialist shipping segment of the market. So in this case one could argue that bulk shipping accounts for 85% of the market.
3. ↩ For the purposes of this post it does not make much sense to segment the bulk shipping market more finely, but it is worth noting that liquid bulk and dry bulk differ in some important ways.
4. ↩ This is not necessarily a completely new business model in the shipping industry since shipping portals like INNTRA, CargoSmart, and GT Nexus have existed for more than a decade.
5. ↩ Nautilus and Windward do quite different things, but both fall within this broad category.
6. ↩ Another example, a company like Cargill might want to protect data about how much of a given commodity it is buying from its competitors although it might be willing to provide its own data as an input in exchange an output sith summary statistics related to its industry and the markets in which it does business.
7. ↩ Mark’s comment drives home the fact that the shipping industry’s economic fortunes are very much tied to global business and economic cycles.
8. ↩ We would love to speak with you if you have a perspective on any one of these issues as it relates specifically to shipping. They are issues we expect to be thinking about for a long time.
9. ↩ Complaints that brokers add no value are common.
10. ↩ This debate is one that is ongoing in the trucking market too. There are many startup founders who say they expect to cut brokers out of the picture altogether. I think the reality is more likely to resemble what Mark, Jenna, and Constantine predict.
11. ↩ I have not been able to find data on operating expenses in the shipping industry comparable to what I found for the trucking industry.
12. ↩ See; JP Morgan Asset Management secures $480m for new shipping fund, Sam Chambers, Splash 24/7. Accessed on June 20, 2017.