#19: Matthew Tillman CEO of Haven Inc.

Matthew Tillman is the CEO and Founder of Haven. Haven was founded in 2014 to help commodity firms automate logistics, collaborate with partners, and gain valuable insights into their supply chain. With the goal of the platform is to essentially serve as the “Salesforce for logistics, capturing the end-to-end workflow of shipping cargo.” Haven supports customers around the world from offices in Singapore, Switzerland and San Francisco. They raised a Series A round of $11 million. Prior to founding Haven, Matt held Technology and Product leadership roles at several Finance and Advertising companies specializing in Artificial Intelligence. But before that, Tillman was the son and grandson of truckers. He’s the first in three generations not to drive a truck for a living.

Discover more details here.

Some of the highlights of the episode:

• The story of Haven Inc
• Differentiating from a traditional broker
• ‘Healthy’ data
• How does a big investment change the company’s growth
• Why Singapore?
• How do they compete with 3PLs
• Impact  of Blockchain – real and hype
• How do you hire and shape the culture?

Follow us on:
Instagram: http://bit.ly/2Wba8v7
Twitter: http://bit.ly/2WeulzX
Linkedin: http://bit.ly/2w9YSQX
Facebook: http://bit.ly/2HtryLd

Transcript

Speaker 1: 0:00

Hello and welcome to build leaders in supply chain podcast. I am your host, Ron Apollo MRU global supply chain practice head for more, at least executive search specializing in local board level until such. My job is also to connect you with local experts both in business[inaudible] supply chain. And today I'm delighted to have with us Matthew Tillman, the CEO and founder of PayPal. A Haven was founded in 2014 to help commodity firms actually ultimate logistics delivery with partners and gain better insights into their supply chains. Uh, basically the goal was to essentially serve as the Salesforce of districts capturing the end to end workload shipping cargo. Heaven supports customers around the world from offices in Singapore, Switzerland, or San Francisco. And there is so far total 16 thoughts prides upon you. The company I tell technology and product leadership roles at several plants and advertising companies specializing in artificial intelligence. But before that he was the son and grandson of charters. So if the first actually in three generations not to drive a truck for leaving[inaudible] over there as a matte pleasure to have you with us today. Thanks for having our hour.

Speaker 2: 1:12

Pleasure. So tell us a little bit maybe about a, about Haven and the story of the company and what's this, what is he trying to achieve? Sure. So I mean Haven started in 2014 we really founded it after having been in, I'd been in advertising automation for eight years prior to that and using machine learning to automate the distribution of advertising. And prior to that I was in a, I built software to support algorithmic trading and the financials and features and forks space. Um, and, and in both of those industries, they were using data to make decisions in real time. And my co founder, Jeff Wiener, who was ex Apple supply chain, uh, he and I were having conversations tonight for dinner and I was telling him about how I, I tried to book a cargo to send a truck to South America. Very bougie problem you have. After selling a company, my wife had okayed me racing across South American and a truck like in any African. So I went about trying to book freight and I was telling him that how ridiculous the process was of price discovery in this industry. It reminded me a lot of bond pricing in the early eighties. You can read about the letters poker and all this type of thing. And um, and so we saw that there was a real challenge around helping people communicate better when it came to either price discovery or documentation execution, whatever it is that into his supply chain, helping people just operate with more efficiency, using data like you use in every other industry. And that's really why we started the company, um, just to, to help customers automate more of their logistics. Good. So basically, I'm coming back to the, it's a good analogy with the Salesforce whole logistics, right? It's basically, uh, it's kind of like a soul isn't ultimate tour. That's right. Yeah. We're a pure software providers so we can't, you know, get you a sweet deal on customs or anything like that. That's not, that's not where we play in the space. Um, we sell a SAS based subscription, annual subscription license software. Um, that helps you do everything from automate the execution of documentation. So everything from generating shipping instructions through a bill of lading, draft and modification on bill of lading, uh, even in runtime direction on the water, um, clear down to rate card management and amendment management and which is currently at nightmare nightmare of spreadsheets and emails. So as a company, we're focused on helping you remove email and poor sources of unstructured messaging from your organization. So very much looking at Salesforce,

Speaker 3: 3:36

well make it simple, right? So you're basically, you're making it simple. Um, and this works for you. Your problem was, and then someone just started driving a truck and South America. So hopefully we'll gets sent a truck to South America, but this applies to pretty much anything right. From sending a truck to send again, I don't know.

Speaker 2: 3:54

That's right. That's smaller. That's right. Yeah. We don't typically focus on the parcel space. Um, not so much because the product doesn't work for that, but because we're focused on large, large volume shippers, because that's where the problems most acute, um, they have razor thin margins and so every dollar they spend on operations is a dollar out in the margin, right? So it's very straight forward at that level and the margins are so thin, those dollars matter. Whereas if you're in shipping personal effects like I was trying to do, you're going to pay whatever it is, but let's say it's four grand for that, that container to get a chart to South American and goodness knows how many people you have to pay once you get there, right? In order to get the truck out of the container. So that type of thing. There's a lot of space, there's a lot of room and attention when you're looking at aluminum tray[inaudible] Singapore trade to proper copper trade, something like that. In manganese, there's a razor thin margin. The premiums are really well-defined, they're often contracted. And when you have a situation like that, logistics makes up such a huge variable cost that you want to be as streamlined, as efficient as possible. And the way that these commodity trading for flow working is that every time they opened up in the trade line or better been established relationship with a new counterpart, they'd have to almost create a new logistics team or add more operational head count to a trading desk. And so price of their commodity was decreasing. Margins are decreasing, operational expenses were increasing. And so that's a great place for technology play, especially automation. Yes,

Speaker 3: 5:25

yes. And actually that's where you started, right? So you focus diction the multiple firms first and foremost, and the problem Vista, the bulk of your clients.

Speaker 2: 5:33

They are, yeah. I think a people have used a Haven to ship everything from toothbrushes and razorblades to, you know, millions of tons of copper and aluminum that evolve, those types of things. And, and so it really works for everything. But they were the bulk of our art focus because like I said, it's such an acute problem to challenge that they have. And, and

Speaker 3: 5:55

so how, and it have been on this question, but

Speaker 2: 5:58

just to go into the depth of it, how do you differentiate yourself from a traditional broker? Because I know you were quite at the ones of both your reference to celebrate them. Yeah. Well I think the one very specific way is that we can't provide you freight. So, uh, we had a customer call us and they said, Hey, are what are your rates are excellent? And he said, well, I, I don't know. It's a bit like asking Excel to get you rates. Um, we can't really do that. The thing that you can do is we have a procurement tool that you can license. It's a little bit like a Reba. Um, and so you can launch into that tool and use that to connect with your network of, of with that they'd be bulk brokers or container lines or what have you, three PLS, whoever it may be. Um, but in terms of freight, it's, it's really funny. We used to get the cars in the space. There's so many brokers that everybody's a broker and people would call us and say, Hey, we're at rates like from here to here. I don't know, like you tell them, you tell me. Um, so, uh, so now we focused purely on the software. There's so much opportunity in this industry, so big and so much opportunity. We really focused on software for BCO specifically. Uh, there were people making software to help the shooting line to utilize their assets better. There were people making software for the freight forwards to help kind of arbitrage and take advantage of working opportunity better. And we saw a large gap pretty much only filled by SAP and Oracle and JDA and GTX and these legacy software providers. So we saw a real opportunity to bring automation to the BCO cells. Um, how do you get your data? That's a key. I mean, that's a crucial part that we do. Make sure it actually helping you get healthy data. Yeah. This industry is not a lack of data, but it's usually not, not the cleanest data. Um, I think there's a few things that we learned from other industries. The first is most of it's customer base data. So a customer uploads that rate cards. Um, it's not so much a trick and getting the data, it's making sure that the customer doesn't have to do any additional work in order to use your platform. So if they upload a rate card and traditional system, you've got like humans in the back end keen in all the rates, you know, all the different port pairs that's not really operationally efficient. So we built a lot of tool in there around being able to capture rate cards in any format for many day shipping lines that automatically extract the data from that. And that was the first step is kind of this local rate management tool, cultivate Explorer. The second piece is how do you capture information that's effectively just dialogue, right? Global trade is two people and then adding more vendors to the equation. But a couple of people that just want to trade goods, right? But there's so many different hands out there, so many different people participating in this conversation. That conversation happens arena today or WhatsApp or recharge or in China, right? So how do you capture that information? We've spent a lot of time building tools to capture that data and to clean it, uh, to scrub the information and get it into a single location. So that part of the platform works effectively. Like it if you have anybody, if you've traveled or if you have any troubles in your podcast trip, it basically takes all the data from all the different ships, the air carriers and all the different hotel providers. It takes all your complimentary booking combinations, et cetera, all your weights and collects that information, puts it into their apps and you'd have a single centralized source of truth for door trips. Right? And we saw that in the huge opportunity for the freight logistics issues. So we did the same thing for a 50 plus carriers and 1100 different freight forwarders. And uh, and so we're the intercept all those equals all that conversation and create structured data from that. That is everything from booking documentation. We get that from both the email stream, the conversation stream as well as EDI as well, API, depending on who the carrier is. And so there's just all these data sources that we had to go clerk.

Speaker 3: 9:50

Oh, that's fantastic. Right? Because I mean I think that's probably one of the, that's why it saves a lot of time, right? Because it wastes a little time to try and match the different sources of transparency. So that saves a little bit of time.

Speaker 2: 10:04

That's right. Yeah. That's typically all done by, I mean our customers are usually the types of companies that do their logistics in house. And when you're doing logistics in house, you have a person that does nothing but go to every single carrier website on a daily basis, copy and paste tracking information into a spreadsheet and send the spreadsheet around for the rest of the company so that people know that they're on the water risk. And so there's those types of things that we focused on automating. We do everything, we automate the types of things you were doing today, basically in a similar way to what you're doing today, but with machines instead of people. And so you go from, you know, eight hours of shipment on manual processes, documentation to some one hour human labor person with regards to documentation, customs, et cetera, et cetera. So it's a massive benefit.

Speaker 3: 10:51

Not definitely. Um, how are you parking? Thought that, let's talk a little bit about also the series of investments that you, you're like the fool you've gone through. How important was it to attract the investors in helping to do like your growth?

Speaker 2: 11:07

Well, so I think there's a common misconception, especially in Southeast Asia in terms of how we see as an asset class works because it's a different type of asset class, right? You have feed real estate, which are assessments in these parts of the world. That's part of the wall. Um, and that's because they haven't had a stock market that's returned to 30 years in a row. Right? And so the asset class itself is something very particular. And so what this means is, what I mean by this, this Haven has a large Tam, the total addressable market. Because unlike a broker, we're not going to fight for five to 15% of a customer's inventory. So that we can sell them so that we can arbitrage freight rates and sell insurance and all these sorts of things on the back end we sell software. And so as a market, every shipper in the world can use software. Right. So first of all, it's important that you have a big addressable work. Yes. I actually was reading the numbers where it was staggering was at 1.6 prudent, dull this market that you are addressing to those shoes. That's right. Yeah, it's a mat. It's a massive market. And I think there's, it's funny when you go to pitch a VC, you don't really have to pitch the, it's a big market because they look at it and we're like, okay, well it's everything that I've touched already. Norway, right? So it's already a big market, but I think you want to see that it's a big market and it's growing in certain areas. Right. And then our take on it, it's going to be a little bit different. So we had to have a very different take than everybody else. Cause there are so many startups out there that are just freight forwarders. Some are freight forwarders and skies, most are just freight forwarders in fact illegally registered us as free-for-all. And so we looked at, we said, well, everyone has built like a freight forwarder where they build software for freight forwarders. So we're gonna focus exclusively on BCO market to give them the information they need to make decisions to be able to automate where bring more control in house over there. And that was a unique value proposition within the VC community when we started in 2014. The second piece is to raise money is you have to grow at a scale that that asset class is pitched. So what that means is if you're an investor, you have liquidity providers, limited partners behind you, right? They are, uh, or depends in pension funds, the sovereign wealth fund here, important cetera, right? And you need to be able to grow at a pace that will return the value of that entire fund. And so software companies are geared to doing that because they get network effects, great comments of rate margins, et cetera. We have this year, we'll process 3.2 million tons of cargo, 3.8 million tons of cargo somewhere in there. Um, and that's one year after launching our TMS, right? That type of thing can really only happen for our software work, right? Those are big numbers very fast. That's like 10% of the size of Pennell peanut and less than a year and a half of operating the business. And that's because we don't have to hire 500 head count to support that. We've automated so much of that workload or our customers don't have to subsequently hire old people as well. That's a really good fit for VCs at cost. So after you get all of that together, you go out to the market with a package that says here's a great growth return to the town, here's the competitive landscape. And then it's really just a matter of negotiating price and size of the race that you need. The other piece is you ask how does it help you grow? This is the biggest thing for startups because if you don't have the right management in place and you take a bunch of money and your management doesn't know what to do with it, that it's completely pointless endeavor. You should be been raising money. So you have to have the people on staff that you can trust the process, the dollars. It's not really about what number you raise, it's about how much can you process. Right. Um, and we're turning metrics, your investors and you have the group. So that's really the, those are the big tricks. There's no other, you know, otherwise you just get up and you talk to 70 different firms and you get five term sheets and you figure out which one you would go with. It's pretty, it's pretty straightforward. Baffling.

Speaker 3: 15:11

And what made you come to intimations the brand?

Speaker 2: 15:14

I know that there's a specific reason also the YC, there's a, there's a couple of them. I mean obviously it's a big trading up, a lot of commodity trading firms here, a lot of volume here and all within a few blocks of where we're sitting right now. So I think from a, from a Legion perspective, it's very straight forward, right? You want that and you want a low cost of customer acquisition, uh, at a software company. The second thing is that, um, I happen to be here if you want the back or the actual story on this. I happened to be here with my co founder in 2014. I had just sold my previous company media company, uh, to the company called conversions and it was a really good exit and I was just done and I want it to be in a less corrupt industry. So I picked shipping,

Speaker 3: 15:57

I don't know how you pick the term less corrupt.

Speaker 2: 16:02

I'm not sure that that worked either. But anyway, so I was here in Southeast Asia with my wife and a couple of friends, one of my co founder and we, we floated the idea that price discovery was broken to a couple of investors here locally. And we had a partnership meeting, probably because my priorities, it's, we had a production meeting on the following Monday with the major LP, which care intelligence Masick. And uh, and so it was a really fascinating turn around, a quick turnaround just to show you how interested this country is specifically in terms of being able to capture trade flows. So if you look at port and you look at the way trade changes over time, same portal, heavily invested in automating ports, but the same court reports Singapore according to they actually own 27, I believe. I may get that number wrong. I, it's 27 ports around the world. So it's not just Singapore. And I think that's people a lot. That's a thing a lot of people forget is that they care about being able to capture revenue and on trade clothes all over the world. So they really want wherever training is the current, that's where it wants to be. And I think it's a really smart position to take. And so we, uh, we kind of fell in love with the country and the space just because the attitude that they have towards trades such an important final part when they come here. So that's, that's really why we're here. Uh, talents obviously on the logistics side, especially early on before we had a lot of those automations in place, we'll just extend our hears. So it's really great to draw from. Um,

Speaker 3: 17:35

and, and uh, we had to dig a little bit deeper the supporters of the company because a, I think he also worked closely with the, is it you do VOC?

Speaker 2: 17:45

Yeah. All the different agencies here have been fantastic for us in terms of a support. It just like, I need a real estate broker help you out or, or um, you know, when you're getting bank accounts and things like that, just really smart structures for how they help entrepreneurs instead of what we are. Entrepreneurship and IP general is, uh, is really important. It's important as a country, uh, for us when you're picking countries to set up offices and you want countries that have a certain amount of travel. We're in Singapore and Switzerland, which is work post our data. It's importance once we're set up really well combined to for pretty person. We're not actually a us company, right when we've got us portraits for R and D to the rest of the company is all our national and it was done that way to provide in fact the name of the company. Haven literally means a safe place to trade a state farm. That's why I picked the name. And so you look at Singapore as a safe place to train cause the rule of law is very strong and that's really, really important. So in terms of the government here has been very supportive of the company and I think the thing that shocks people is the shipping lines that actually been very supportive and pavement because we're not trying to disintermediate the relationship that they have with their customers. Right? In order to get full benefit out of Hayden, you really have to have shipping line relationships. So, um, I think that's been something that people have been shocked by is just how helpful the shipping lines, but for us all African super nurses. Yeah.

Speaker 3: 19:08

But let's talk about this. We feel, feels like both the shipping lines might've been, might've been nice to you, but how about the three bills? Have any challenges potentially

Speaker 2: 19:19

takeaways a little bit too. Yeah. Also, I think here's the thing with reveals is if our customer wants to use this repeal or carrier, they onboard through PLR carrier and it works just fine. Like we don't in the middle there. I think there's a trend that is irrespective of payment success. There is a trend in the industry where more and more customers are bringing the basic basics of logistics and house. They want to take more control over their logistics, especially in a high customer. So when you look at three PL, they really don't have a market there anyways. However, what I will say is that when customers are evaluating, our customers are evaluating EPLs and they use them and certain trigger trade lanes for customs purposes or for warehouses space or for trucking contracts. It's repealing manages that that adds a lot of value to our customers. Right? When you take risks, three PL isn't that to off set risk? It's meant to offset the risk of head count. It's meant to offset the risk of where I've expanded that to offset the risk of whatever it may be, three fields and playful words, I'm going to use them interchangeably because they're effectively the same thing. Or that at least there was a 100% overlap on the products that they offer. Um, the problem with that model though is it introduces selection bias in the supply chain. A three PL gets a primary, secondary tertiary carrier. They're allowed to choose from when the origin at a BCO books, right? Origin NBCs says, I need to pick up, here's my second primary, tertiary and secondary tertiary carrier. You pick which one works. And then what happens is there's a lot of visibility loss between that selection and the cost of that selection and what the customer ultimately wants it. And so what we really provide when a customer is easy through PLLs and we do have customers talk to eachL c an N augle p enalty a ll i ts guys. U m, what they really look for is, is the three PL servicing their business in the healthiest way for the business versus the t hree p ills m argin. I t's number one. And number two is what value add can they provide. A nd I don't want to take on as a PCO does c anonical have warehouse space, j ust k inda normal have trucks that they're going to buy and assets that they're g oing t o p lay. Do they have p lanes i n t heir c hart? All o f that i s really valuable. I think there's any place f or this repeal for a long time. So long as they focus on asset o wnership and a ll setting the asset r isk that a customer doesn't want to take on. U h, in terms of documentation and generating documentation, getting, you know, HS codes, right. And things like that. You know, if your job is copy and paste, that's a short term, that's a short term job. Those jobs are going away. And I think, you know, systems machines can copy and paste a lot better, a little better, a little positive yet. Let's still consultation for a moment that and help you see the future. Cause I know that they have some vehicles. Yeah, I think we're gonna see in this industry what we saw in banking and finance or past 30 years, 20 years, is we're going to see a lot of consolidation. There are 190,000 registered freight forwarders in the world as a registered, or probably a lot more than that. I think if you go to the Wikipedia page for freight Porter, you're gonna see a couple of guys sitting outside of a sign word[inaudible] basically a garage. And so anybody can be warm and that doesn't mean you're gonna be successful. It just means there's a lot of fragmentation in that market. So it's ripe for consolidation. The other thing that you're gonna see in this space is it won't just go from like, you know, in the banking industry, we used to have hundreds and hundreds of banks in the U S right? Hundreds, maybe thousands. And now there's six in there right now there's six big ones that matter everybody else's for the most part, right? So you get some small specialties, but mostly it's consolidated. The same thing's going to happen in this industry because it's really about people. All those businesses, you're consulting firms with financial sales and stuff back end. And you can buy Salesforce, right? You can buy sales teams. So what we've seen from the carriers, it's really fascinating to lately is the carriers realize what the freight forwarders, main value ad was managing difficult to manage customer situations, right? And having the novels it has, well, a carrier can buy into that knowledge base very inexpensively, as we've seen over the years. And then it's a matter of how do they operate that business? How can they, what are the economics on that business? We've seen Merced with D'Amico, right? Um, what we're now seeing burst kind of distance itself from the space, right? Over time they're going to rebrand that repackage that. They talk about going vertical, right? A lot. As a firm, I think that's gonna become very, very common going vertical pass Asish we're gonna see more of that. Yes, yes. Um, and it's not always[inaudible] or seems to be following the same minds, but um, you know, just you know, thought, because I think that we'll share mine for instance, you have a free photo and he was, he was coming from the[inaudible] relationship as long as the folders are there. This man was that as long as, as long as the phrase the phrase medical technology, ultimately painful processes and good teams, they will actually come to come to them. And I think upper hand is probably the right term to use. So I'm not sure it's the long you wanted to use, but that's exactly right. When you drive demand than shipping lines, we'll work with you when you don't drive demand they want, when they think they can get to demand themselves, they'll just do that. I think the thing that prevents shipping lines from owning a hundred percent of those customer relationships is one they don't want to, a lot of it's not profitable business and it relies on carrier rebate structures in fact in new or deep imagine, so carriers that historically used the for courts as channel sales basically for them. The second piece of information was what we had in the software industry called stickiness and I think a freight forwarder gets their stickiness not just from the fact that they liked to hang out with one another. I mean maybe it's the case that DCOS really enjoy hanging out with, they're afraid for their salespeople in real quick order ops people. I don't know that that's the case anymore. I think those days are becoming less and less over time, but what I do recognize is that if you have, if you've sold[inaudible] people acquire risk from afraid for BCO and I've paid it incremental dollars to work with the freight forwarder and that freight forwarder has offset some amount of risk in my business, then that's really sticky. I know I can always go to that freight for it for warehouse space. If a shipping line comes to me and pitches a new business, which is why I think it was smart that seen it happen there and see that and see that tied up. Because now see Megan say, see with Siva they've been doing this for years. Their teams are here, the teams are in place, no change, right? For the, for the customer, when in reality it does actually change for the customer because then it ties up to the provider basis seeping. Now it gets better provider status with a CMA than they would have otherwise. Maybe it was always the case because on some deal we don't know about, but my point is like the selection biases inherent in that relationship just like it is with Dan Korn line, even though they'll tell you nobody is the best provider for your shipment, I think that that doesn't matter mathematically. There's a selection bias in that process and I don't think that's necessarily a bad thing, but it exists. And so we're gonna see a lot more of that. And Steve as sticky. And so, um, apex, maritime, Kerry logistics body puts maritime because apex maritime had a sticky executive staff. But the reality is that executive staff, you can hire them away after their six year around or two year around or whatever it is, and then you get that stickiness. Right. Um, so I think that's the trick that they're going to have is that it's like saying Accenture, a stickier than KPMG made. Maybe they're both consulting firms. You can put them on a bit over two years or 18 months like you should do and find out. Right. And so I think that's, that's a tricky, which is why assets, I keep going back to this. Assets are so important for freight force. Yes. Yes. Um, what, what is the most important Mark that you want them to leave on doing this? Big question, but you know, what's the, what's the, but that view? Well, so what we're seeing already, the impact that we're seeing with our customers now is that we've changed the economics for their trade. We've completely changed the economics. The expectation now from our customers is that the operational costs are texts less at least than they ever were in past. So their techs less than their prior best, and that changes the economics of the commodity. So if your commodity share trades at$135 premium, let's say you're shipping over[inaudible] per time, sell it at$135 markup to your customer, that's contracted usually. And if you, if 25 of that or 50 of that or a hundred of that is going into logistics, now it's 10 X less from an operational perspective. So I think the thing that's really excited about working for all commodities in particular, logistics generally walking by some particular incident, the scale is so great that you can say tens of thousands of hours of human life. But that's the impact of that is look, we can say tens of thousands of hours, Cumulus can go into literally anything else that's more valuable than copying and pasting. Like I'm obsessed with this. Like people are always like, Hey, I saw dad and Paul's battle and stuff. But the reality is like that human life can go into literally anything else and it's more valuable. Right? And that's, that's what I'm excited. I think, right. We can change the economics of changes, the expectation that people have. That's how you have to change it through their economics. Um, you can change how much you can pay in labor. Have you got a mind in Congo? Right. My guess is that labor is not getting pinnacle. You can actually afford to do that and maintain your margins. You can have a healthier, more sustainable supply chain. You can get better talent to work with you. I think that's the exciting thing. Yes. Returned to me. You say the lowest amount that we've ever saved customers, something like$25 per, uh, per container. That's the smallest amount. And, and in that particular trade, it was already recyclable straight. So that's basically doubling the margin on a container for them. Failed. They only make 25 to a hundred bucks on my full, fully loaded container on the front end. And so that's, that's really valuable, which was to say, absolutely. It's a no brainer. Yeah, it's, it's a really straightforward value proposition when you can go in and say, I'm going to bring you$5 or$10 and you're going to give me two.

Speaker 3: 30:16

Yeah. You don't need to be a brilliant mathematician to figure that one out. Um,

Speaker 2: 30:24

okay.

Speaker 3: 30:25

Uh, Matthew and one of our listeners was asking the question was this book? So he was asking how can we get over the black sheep in the blockchain room? Achy eight customers.

Speaker 2: 30:39

Yeah. So is that the black, I think that's, that's a really good question and very specific. I think it was two things about blockchain. One we have to mention in every podcast because you want more listeners, so that's like very straight forward and we're going to look us in the future. Oh, that's fantastic. You should get a demo of the product. Um, so I think in terms of block changers, there's so many things, right? So I'm actually a software engineer by trade, and so I have a couple of different takes on it. But I think the reason it's exciting in this industry to start with is because the industry is full of trading, right? It a global trade. It's people arbitraging some amount of information, a century that they have over there, over there part of your camper. And blockchain brings about the hope of truth, right? The hope that we can all still do that but then have a true system that we all agree that this is our general ledger across enough to notes. Um, I haven't seen a solution in our industry yet that actually addresses the problem that the industry has, um, in a way that we couldn't address before. A Haven versus local share drive plus blockchain. Right? All these things are just ways of communicating. And I think blockchain specifically with regards to customs, I don't even know that really, it's interesting when you have customs agents that love it when our customers use Haven because the customer's issue gets paid faster. Like everybody's happier. Right? So from a payment network perspective, I think blockchain makes a lot of sense. I think it's currently it's only real valuable use cases. Actually Bitcoin, I think there are in smart contracts if you're on material, but in terms of who initiates that smart contract that's still done offline, right? It's still like a receiver has to be important to say that across the gate and therefore across the gate that gets frustrated. Blockchain. So, um, what we have to do to make blockchain work though, I'm not sure it's worth making work really in it's in its current state. Um, it's a shared database and a lot of different companies have to agree that they want to use the same sheriff database, which is not happening. The consortions are small. Um, they're too small, justify the number of minutes required both into a 51% attack. Um, and each of the banks has now decided to silo their own blockchain, which is the same as just saying that, you know, we're, you know, five of us are getting together and using the same as Oracle or the same instance of SAP or whatever. So I still know, I don't think we've seen the real use case in the shipping industry and I don't know that customs will be the biggest problem. I think the biggest issue will just be that they're all siloed. We did, one of our customers did a blockchain transaction as a test and then the pain, a prehab to print in terms of market fees because those are not predictable, right? So your network usage is your basically your, your checks on 50 acres decreased over time. You really want to be controlled. So that was one piece that happened. And the commodity trade, it's really difficult to justify that. The second piece is I said what we saved, like you know, 30% of the standard manual operation for 70% or whatever the number was. And that's, that's very common for a customers that has less to do with blockchain. It just has to deal with the fact that you've got a collaboration, right? So I think I'm looking for blockchain to first sole payment, more international paper problems, which the current international payment scheme is difficult to deal with. I think there was a big guy on three tours, just, we certainly do it for our customers as well. Um, so I think that's, that's kinda, yeah, that's a sweet spot is in payments right now. It's not as hot as an opposite as everyone says for some reason in the industry. And when he talks about how anonymous, you know, blockchain payments are, they're not really got an honest, it's actually pretty trivial to find out who get the payments. Um, and I think that just because they're a cricket for record perspective doesn't the whole Embeda dates crooked. So it'll be interesting to see kind of how that rears its ugly head here when people find out where that metal is going. Yeah. And I needed to bring something was asked the same question. So you know, the, the director of transportation and logistics to them, uh, to MIT and asked him what's[inaudible] yeah. Which very few actual case or case studies that are being done mostly demos or you know, small that good proof of concepts[inaudible] slow. I mean it to, to, to make a dispense little compared to the must've[inaudible] well, so actually I'm going to disagree respectfully on the last point because I think that blockchain transactions on the Bitcoin on lightning network specifically for Bitcoin, it's actually much better than back because it happens 24 hours a day. You don't have to wait from the payment to clear the next day. Um, it happens within minutes or an hour, right. Versus an eight hour day at 18 hour wait period. So I actually think that it is very good for international transactions in terms of when it's your visa card and visa and MasterCard are fronting that and it really depends on who you want to be. Your frontend. One of the bigger problems with blockchain is that yeah, I don't see two use cases. I see plenty of use cases for it, but they're all satisfied by current technology. Um, but it also, it just offers a hope. Right? I think right now it's just a cool technology that there should be a lot of demos about. We should be doing this. Like I was hacking on internet when I was like, I don't know, like 14 and I ended up making a career out of it. Right. And so I think that was really early on. That was before we had property commerce and we had shopping carts written in Perl scripts and all these sorts of things. Right. So I think you have to start hacking early on and eventually something will come out of it. It is a shared database. The concept is really cool. Like mathematically we can have a shared database in terms of yeah it's over-hyped for the shipping industry, but hopefully that height leads to investment, which leads to some green shoots coming out of it, which I would be excited to see. But I think the payment, the payment thing has been a big deal up because early blockchain is so slow for clearing or early Bitcoin sold, declaring didn't have as much faster transactions and pretty low cost to the total. And then there was another question from a pro method just to move a little bit on the phone glitches with people saying apart from price and service, what topics do you see driving to feel this election in 2009 and I know that you don't tell about essence. Well I think that's the, that really is the big thing is if customers aren't going to less and less customers are going to demand more and more of their three PL and that's, they're not going to pay$100 for ISO filings and you know,$50 for BL changes and things like that, that that business is gone. It's dying or gone. And the other side of things on the three deals that is, that was a really high margin business for a company like a DHL and that high margin is not there. You can no longer justify labor arbitrage. I don't care if it's in Thailand or Philippines or wherever we got your labor, that labor cost is increasing, the price of customer is willing to pay is decreasing because systems like ours are coming about. And so there's a cross when that business doesn't even work anymore. And if DHL is struggling for eCommerce transactions and are struggling to maintain a three PL, then it just doesn't, doesn't work any longer. So I'd say when you're, if you're a customer, any of our customers, if they're looking at three pills and all, they're looking at them primarily to assist on particular trailing where they need to localize the customer service support. So they need somebody, okay know to respond to them and you're right better than okay. And they need a local asset to justify it. They need warehouses, right? You need, you need some sort of asset as a differentiator. It's not like everybody doesn't have plants or if he has plants, of course the charter. But the fact that you are willing to take that risk, which is something that customers usually not working here. I mean, if you're Apple, you're buying, you know, you're on seven 47[inaudible] and cutting FedEx clean. But I think right now change looking at making sure that they have assets, good customer service, which is not the case right now for most of the pills. They have assets and they don't select against their customers. Yeah. Three people that choose the right provider for their rebate structure are not helping for customers and that business customers getting smart CFOs are starting to take a look at the supply chain teams. That business has gone. Yeah. Yeah. Um, how well this[inaudible] people the boat, uh, and it's, it's so important. Right. And started up slightly because the key is the growth of the company. How did you[inaudible] before this has changed a lot over time as you might imagine. I mean it's a very different industry than advertising or ordinance, um, than, than finance. Um, first I would say that the product that you build, the culture you have, the types of customers you get are all a result of the type of people you are. And that's something that you almost have to learn. Every new industry I have to go in. You have to relearn that concept over and over again because you think you want one particular thing that doesn't work it out. So I think that's changed a lot for us. Over time we become far more transparent in hiring process. We're very opaque. We were very, like we didn't tell anybody anything about us in the hiring process. We didn't mention number or anything like that or not. And I think, uh, I think we also early on prioritized people about industry knowledge over over, um, people who had technology. And that's changed over time as well. The more we've acquired on the industry side, the last one we've needed that more focused on, on talent that you really curious has a technical background. It's been there and done it before. And I think that's the thing, the coaching people are most important for our business. Haven's going to have, if we're successful, Cayman has hundreds of different types of products, uh, spanning multiple industries. Uh, transportation will be a component of that, right? Over time, if you think about how big a company could get. So if you're going to get that, you're going to think in those terms. You have to be able to hire people that are the right fit for the place that you are now and the place that you're going next. Right. Uh, I think that's the big thing. And also we're not afraid to upgrade at the company. I mean, we upload people, we're very blatant. We automate work. We're very blatant about that at the company. You can talk them that many transactions go into the system. We have like three ops people and they're all right. And that's because we focus on innovation. Hire people that want to focus on automation. Um, you have to hire for your asset class, for the VC backed company. You have to hire people that understand you can rapid rate of growth, right? And they can focus on that. Think about how do they grow quickly and how they ensure their customers are successful and things like that. So we look, we look for those types of things, which are very specific. I think the general thing that I look for, I personally did before is that if I'm hiring manager, if I'm recruiting company, I want them to be able to hire people better than they are. I want them to attract 10 that's better than they are and have the ego to be able to hire that person and help that person. Um, that's not always something we've done right at the camera, but that's what we're looking for. Right. And we hire people that have a natural curiosity to take a capital, take our shirt, especially in the start. I think you know, early on if the people that you have are people, that's the first 25 that sets the tone for the company forever. Right? PayPal is the best example of the first 25. Right? That people are asking, like Peter teal kind of seeing that first, you know, it's just like they had all this talent the very beginning that got, they understood about, they were trying to climb with the focus on. So I think that's the biggest, that's what we look for is curiosity. They've been there and done that. Like at what stage of their career with it. Now let's talk a little bit about the culture, the culture of the company, the, and you have the, your, so how do you consciously, um, well, so it's definitely changed. I mean, it's changed over the past six months. It just constantly evolving, changing thing. Um, the only way you affect culture at a company positively, you can always negatively impact a culture, which I've sir, but you can positively impact culture where by hiring you, you hire the types of people that you want to set the tone for the next stage of the company. And early on you're going to hire people that are really good individual contributors. Since you're going to prioritize this culture, you're gonna have this like work mentality, right? And as you grow, you're gonna prioritize people who have a little bit more strategic backer that can really take advantage of different market and they're gonna bring a new flavor with challenge and eventually you're gonna have people that were like, it happens, right? Like every tech company gets to the stage, which is great to you. You want that growth, you want that trajectory. Right? Have a flip a lot. Yeah. So that's, that's kind of a thing. So I think we'll need, um, uh, we're at that stage where we're now in scaled answer growing the team with the type of people who ask you who've gone from, you know, a small number of said at software firms and bringing a lot of that sass experience, whereas we're not prioritizing like logistics as much as we did. And that's usually how that works. That's how you know, it's like rings on a tree. You can see at what stage the company is based on. Um, what, tell us a little bit about what is very interesting stories that you've gone through. What some of the key uh, entrepreneur support somebody who is thinking he had kind of fallen on the last question. Honestly, the people are the most important part spent. You know, if you're the CEO and founder of a startup, you're going to want to do all sorts of things that you were really good at it at previous jobs where you ran product and ran technology or order ran sales, whatever you did, um, and you should not do those things, but the majority of your time you should hire great people to do those things better than you. Um, because I think for me at least, there was a natural, there's a natural leaning to look towards individual leadership. I mean, I looked at the product and like, well what about this button's in the wrong place and the fonts wrong, you know, that kind of thing. No, what you do is you hire a talented, they take over that little league, build a much better product and you have to do every kind of case. You're more like a leader and you are an actual, you know, then you are natural tendency. My, my default at least that's I, that's fine. This is the second company I run. Even though I wasn't officially CEO at the last company, I did run the exit of the last company and manage that process. Media, freight, logistics, banking. They actually do have some similarities. People need to collaborate. Humans need to do work with one another and they want to do that. Work is honest and transparent environment as is possible for their industry. And so if you provide them tools to help them do that, work smarter more efficiently, they're going to gravitate towards it. That's it. That works in the media industry. That works in the finance industry or just across the board trading, screaming in the finance industry. You've got demand side platforms in the media industry and then you have companies like located in trigonometry. And so I think there's a lot of similarities between those industries because at the end of the day, it's literally all about people. Like, I mean, I can't tell you there's, there's all sorts of ways to manage a board. There's all sorts of ways to raise money. And I wouldn't tell startups though, they're struggling right now. Don't take strategic money. Uh, there's a lot of accelerators. There's a lot of flight industry accelerators for articulating a piece of the action freight forwards, getting a piece of the action. Don't take it. You don't need to do it totally unnecessary. Just get better at selling your equity if you need to take it, that kind of money. But uh, uh, don't, don't take strategic money to early on. We will completely start a business. You're never going to affect about cheap or fine. Never. I don't care how many billions of dollars you're worth. You're barely gonna tics that make a dent in their balance sheet. So focus instead of building a real business that provides value to customers. Delco easy way. Yes, my example. Yeah. Thank you for that.

Speaker 4: 48:11

Pleasure. Thank you for sharing. Thank you for the lessons then you for the growth and we wish you all the success. Thank you for listening to our podcast. If you liked what you heard, be sure to follow us on[inaudible] dot com slash podcast for all the show notes, links and extra tips covered in the interview. Make sure also to subscribe to our emailing list to get the news in the Nick of time. If you're listening through a streaming platform like iTunes or Stitcher and you like what we do, please kindly review and give us five stars so we can keep the energy flowing it get more people to find out about our podcast. I'm most active on LinkedIn, so do feel free to follow me to stay tuned for our latest articles as well as future guests for the podcast. And if you have any suggestions or any other idea, please feel free to write to me. I respond to all and also please make sure not to miss our next episode where we will be having a few other C level and top leaders in supply chain joining us. Stay tuned.