The future

of logistics

Copyr ig ht © 2 02 0 RO KK 3R INC . A ll r ig hts reser ved .

Status Quo
‣ The maritime logistics industry is enormously important to the global economy, with
90% of all internationally traded goods transported by sea.

‣ Over $1.1 trillion is spent every year on international freight forwarding services.
‣ There are 25 freight forwarders that each do more than $1 billion in revenue a year.
None of them were founded after Netscape and they still rely on paper-
and phone-based processes that manually match shippers with carriers.

‣ Container shipping capacity has continued to concentrate in the largest five carriers
over the past 20 years: the largest five carriers handled 27% of all TEUs in
1996, 46% by 2008, and 64% in 2017.
‣ Overcapacity is a major driver to declining container prices, as the
current supply of container capacity is about 20% greater than demand. The main
culprit of this problem is shipping companies buying larger ships, trying to get more
cargo on each ship for a lower cost and undercutting the competition, effectively
shutting them out of the market.

‣ With ocean freight prices so low, a considerable portion of logistics costs come
through labor costs—particularly compliance and coordination of cargo handoffs
between different players in the chain.
The container-shipping industry continues to concentrate
SeaLand
Maersk
Evergreen
COSCO
NYK

Maersk
Evergreen
P&O Nedlloyd
Hanjin
MSC

Maersk
MSC
CMA CGM
Evergreen
Hapag-Lloyd

Maersk
MSC
COSCO
CMA CGM
Hapag-Lloyd
 The global trade supply chain is complex and
resistant to change.It contains a large number of
disparate players, with up to 12 intermediaries
involved in the process of getting goods from A to B.

EXPORT ORIGIN FREIGHT DESTINATION IMPORT

HAULAGE HANDLING HANDLING HAULAGE

SHIPPER ORIGIN ORIGIN DESTINATION DESTINATION CONSIGNEE

WAREHOUSE PORT PORT WAREHOUSE

Exports customs clearance Imports customs clearance

While maritime shipping and logistics companies play a crucial role in global
trade, little has changed in container shipping since the first crane hoisted the
first box in 1956.

“Complex rate contracts, massive spreadsheets, hundreds of emails, and

PDFs bring frustration to industry players, consume massive resources,
and destroy business efficiency”
– Quotiss founder

“Imagine if every hotel would also be in charge of arranging visas, passing

through immigration control, security check and a taxi ride for each tourist
globally - would it still be so easy to book a hotel online with a couple of clicks?”
– Marcin Zarzecki, CEO Quotiss
Change is coming
A number of startups are attempting to build products to serve that market and big
industry players have started making changes to their business models - e.g. regarding
freight transparency, online booking, and automation of processes.
The Supply Chain & Logistics Tech Market Map
Industry Trends
New platforms are emerging to solve for both
lack of visibility and connectivity in the supply
chain
Centralized Marketplaces
The rise of e-platforms/freight marketplaces improve transparency and freight visibility in
the market by bringing together shippers and carriers and matching the supply of freight
capacity to the demand. These digital first platforms pose one of the strongest threats to
incumbents, adopting digital technology as the basis for an asset-less business model
that lets them compete with a much lower cost base.

‣ Shipper to carrier marketplaces: help carriers/forwarders increase capacity utilization

‣ Carrier to carrier: exchange capacity and loads among each other
‣ End to end, trucking, warehousing, maritime only, air only, etc...
‣ Recognizing the opportunity, e-commerce giant Amazon has obtained a license to operate as an
asset-less cargo forwarder between China and the US. Amazon entered the freight space in
2017, offering services to help organize ocean freight shipments between China and the US for
its merchants.
Virtual Forwarders
Shifts in retail, the rise of e-commerce, and just in time manufacturing have increased the
need for end to end shipping (i.e. Flexport) and intermodal transport systems.Virtual
forwarders contract with carriers and are a one-stop shop for all transportation related
services including contracting and payments.
Some freight booking startups are leveraging technology to connect
existing supply chain players…
Centralized
marketplaces
Israeli-based startup Freightos,
which has raised over $50 M in
funding, has created a centralized
freight booking marketplace where
customers can receive a quote and
book a shipment in minutes.
Matching containers
with available space
Startup CoLoadX helps freight
forwarders find shipment rates,
while helping to also match them
with NVOCCs looking to fill available
container space.
Freight
contracting
Startup CoLoadX helps freight
forwarders find shipment rates,
while helping to also match them
with NVOCCs looking to fill available
container space.
Others are bringing freight forwarding online and increasing visibility…

FreightHub acts as a full service freight forwarder
that leverages data analytics and software to help
minimize disruptions along the freight supply
chain. Their platform also provides live location
date on various shipments.
Fleet recently pivoted from acting as a freight
rate marketplace to becoming a digital freight
forwarder. It will now offer freight booking,
shipment tracking, and customs clearance
service, among other services.

Funding: $23 M Funding: $14 M

Investors: Rocket Internet Investors: UPS, Lufthansa
Autonomous, but not unmanned

Funding: $4 M
Investors: Aleven Capital

San Francisco-based Shone seeks to retrofit existing ships with autonomous

technologies to aid existing on-board crews.

The companies technology uses AI and existing ship sensors to help detect
and predict the movement of other vessels nearby 24/7.

Partners with
Incumbents grab ahold of tech
In response to a rising trend in technology, incumbents supply chain players are
developing in-house technologies to enhance supply chain visibility to compete against
the raise of freight forwarding startups.

Maersk’s freight-forwarding arm Damco a digital
freight forwarding platform dubbed “Twill” in April,
2017. The platform provides shippers with instant
quotes, shipment tracking, and digital document
management. It has since expanded to trade
operations in Chine, the UK, India, and France,
among others.
Freight forwarder DHL released its newest digital
supply chain visibility technology “MySupplyChain”
in May 2018. MySupplyChain offers unified end-to-
end supply chain management software that
provides shipment visibility and data analytics to
help streamline supply chain operations.
Freight Forwarding Freight Forwarding
Incumbents Startups

more Scale less Scale

more Established Relationships less Established Relationships
less Tech Innovation more Tech Innovation
Blockchain shipping initiatives

Mar ‘18 Consortium that tested a blockchain solution on 12 separate

shipments to eliminate the need for printed shipping
documents.

Jan ‘18 After previous collaboration, Maersk and IBM formed a new
blockchain company to commercialize blockchain use. So
far, dozens of companies have been on-boarded.

Sept ‘17 Carrier HMM (Hyundai Merchant Marine) completed its first
blockchain pilot voyage, as part of a larger consortium,
tracking cargo with blockchain and IoT technology from
booking through delivery.

Sept ‘17 Partnership to launch a blockchain platform that helps to

simplify marine insurance, an area commonly plagued by
excessive paperwork. The platform, dubbed ‘Insurwave,’ went
live in May 2018.

Aug ‘17 Official partnership to improve shipping security and

efficiency through blockchain. Completed successful
blockchain trial tracing cargo from Chongquing to Singapore
in February 2018.
Blockchain’s successful implementation and standardization
could mean…
Case Studies
Flexport
Flexport provides global freight forwarding to enterprise-level customers looking to
ship goods internationally by ocean, air, or land through its software platform. Customers
can expect an end to end service, a dashboard to track and monitor global shipments in
real-time; and data analytics / reporting to gain a better understanding of their supply
chain.

Year Established Funding Industry Focus Value Proposition Location

2013 $304 M Logistics Flexport pairs dedicated San Francisco, CA

Late stage venture SaaS experts with powerful
58 investors Shipping software to move freight by
Supply Chain air, ocean, rail, and truck for
Management the world's leading brands.
Real-time tracking Transparent pricing Shared workspace

The Flexport model directly serves retailers and brands

‣ Many of its clients are e-commerce and consumer startups

‣ Partnered with Wells Fargo speedier trade financing, an advantage for SMEs
‣ An alternative to using Amazon for freight forwarding
Haven Inc.
Haven provides a cloud-based transportation management system that
connects shippers to freight forwarders.

Year Established Funding Industry Focus Value Proposition Location

2014 $14 M Logistics Haven software automates San Francisco, CA

Venture Shipping trade, enables collaboration,
10 investors Software and provides detailed
Supply Chain Mgt. visibility into a shipper’s
Transportation supply chain for commodity
producers and their
customers.
Freightos
Freightos offers an online freight marketplace showcasing price quotes from
different freight forwarders.

Year Established Funding Industry Focus Value Proposition Location

2012 $55.9 M B2B Freightos makes global Jerusalem, Israel

Early stage venture Logistics trade frictionless with an
11 investors Shipping online freight marketplace
Supply Chain Mgt. and powerful international
Transportation freight routing/pricing
technology.
Xeneta
Container pricing platform that digitizes the crowdsourcing of ocean container
prices, bringing pricing transparency to all stakeholders in international container traders,
including freight forwarders that can better adjust their pricing. Xeneta has grown in its
database of contracted shipping rates from 2MN in 2015 to 23+MN in 2017.

Year Established Funding Industry Focus Value Proposition Location

2012 $20.5 M Analytics Ocean freight rate Oslo, Norway

Early stage venture Enterprise benchmarking and market
5 investors Software intelligence platform and
Logistics index. They provide container
SaaS freight pricing transparency
Shipping with one platform in real time
& on demand.
Quotiss
Quotiss mission is to help traditional industry players upgrade their technology using
unique algorithms that automate the quoting process for management,
procurement, and sales teams.

Year Established Funding Industry Focus Value Proposition Location

2017 Undisclosed Logistics Quotiss ads transparency to Poland

Freight Mgt. the shipping industry by
enabling companies to
benchmark their ocean
freight rates. Useful for both
importers, exporters and
freight forwarders.
Problem Exploration
Lack of visibility, transparency, and accountability in
Supply Chain operations

Globalization presents several supply chain management challenges to

organizations that have to coordinate with parties across borders
regarding manufacturing, storage, and logistics. Furthermore, customers expect
to receive their products on schedule and maintain real-time visibility despite the
increased complexity in the manufacturer’s supply chains.

Over-reliance on paper-based processes and legacy IT systems has

resulted in a significant loss of information, lengthy procedures to obtain a
quote, cumbersome documentation processes, and a lack of real-time cargo
tracking.
Port operations are highly inefficient resulting in
huge costs

Some ports still can’t take the sheer size of some freighters or don’t have the
room to store the containers that come off of them. Infrastructure problems are
especially prevalent in developing countries where delivery volumes are
increasing, but the ports simply can’t take the volume.

Terminals waste >$20bn a year moving containers across a yard, often

unnecessarily.
Non-standard quotes make programmatically
comparing prices a huge pain

If you’re a company that needs to ship stuff in containers over sea, you’ll get
price quotes (from shipping lines or freight forwarders) delivered in excel sheets.
They tend to use different layouts, different names (on ports, regions,
container sizes, etc.) and different ways of displaying other relevant data. They
also often contain mistakes, because they’re created by humans. That is
why providing instant quotes for container shipping is complicated, especially
for journeys entailing intermodal transport.

Every supplier has its own standard, meaning there is no standard.

Underutilization of trucking assets

The utilization of road freight capacity is ~60% due to trucks returning from
journeys empty or partly full. This unused capacity has a significant
negative impact on the business as truckers struggle to find loads that match
their equipment, making it one of the most wasteful industries in the world.

Furthermore, for shippers, inefficient, lengthy, manual booking processes are not
conducive to the “we want it now” mentality that is becoming more common
among the consumer base.
Volatile pricing and dysfunctional market

Unlike the stock market, container shipping prices are incredibly

volatile and opaque. If you’re bad at negotiating sea freight prices you risk
paying four times as much as the ones who are good at it. At worst, this
shipping line‘s highest prices are four times as high as the low ones.
Low margins and limited differentiation

Low margins – a result of overcapacity and market concentration – are a new

reality for shipping lines. This can be mitigated through cost reductions (i.e. fuel
efficient algorithms that optimize vessel speeds), improved terminal operations
or through revenue optimization using technology, by investing in higher margin
initiatives that improve the end-customer experience.
Takeaways
‣ The whole logistics business is still living in the past, both technology-
and mindset-wise. Meanwhile, customer experiences are rapidly growing, shaped by
flawless B2C digital user experiences.

‣ Logistics and transportation are entering a time of transformation both on land and at
sea, driven by rapid advances in cloud platforms, big data, AI, automation,
robotics and autonomous vehicles, and by evolving market dynamics
(overcapacity, carrier concentration, reduced prices).

‣ Incumbents have the opportunity to replace their manual processes with more
efficient digital ones and exit the industry’s low-margin trap. Digitization can help
selling to the lucrative SME market easier.
‣ The needs of customers will diverge, some will expect their shippers to be fully
integrated into their supply chains - and be willing to pay a premium for that - and
others will continue to demand freight at the lowest possible cost. But all customers
will expect transparency and reliability to be the norm, not the exception.

‣ Smarter shipping is poised to shrink the physical world the way faster internet shrinks
the digital one.
‣ Cloud-based, Mobility as a service (MaaS) is not only possible, but will become the
de facto standard for shippers across the world.
‣ By using AI to monitor re-order cycles and plan future shipments, software can
allow businesses to flexibly manage their supply chain, instantly
replenishing their inventory when they run low.
“In the age of the customer, executives don’t
decide how customer-centric companies are –
customers do”
– Kate Laggett, VP & Principal Analyst, Forrester Research
Rokk3r in
Logistics
 Freight forwarding management software platform

THE PROBLEM THE SOLUTION

Out-dated, manual and costly logistics processes All-in-one logistics digital platform

Freight forwarders are struggling to adapt to evolving customer Cargologik empowers freight forwarders to provide an all-in-one digital
expectations and increased competition as they rely heavily on manual experience for shippers to automate and optimize their logistics
business:
and non-scalable processes. Only 6% of the largest freight forwarders
and ocean carriers offer end-to-end online booking capabilities. • Automated Transparency into tracking of cargo
(McKinsey, 2018) Their problems are even further compounded by: • Management of quotes, bookings, and shipments.
• Dwindling margins: Having to compete on price as opposed to value • All-in-one communication
sacrifices their margin. • File and Data storage
• Threatened by “tech first”entrants: Flexport, Freightos who are digital- • Reporting and analytics
first forwarders or marketplaces • Access to additional value-add services such as financing and
insurance*
• Shipping lines encroaching logistics partners: Looking to expand their
footprint with customers (i.e. Maersk launching Twill)
Freight forwarding management software platform

THE OPPORTUNITY
Freight forwarding industry is growing steadily
as the global trade keeps soaring
 Freight forwarding management software platform

C U R R E N T S TAT U S

Business HQ Maturity state Current beta clients

Miami, US • Portfolio company from
cobuild,
• Preparing to launch

Looking for specific, Capital raise Next milestone

value-added investors Currently raising funds Targeting to go live
up to $1M in a seed early Q3 2020
round (previously
raised $500k in seed
capital)
 On-demand warehousing for business
THE PROBLEM
Static and inefficient warehousing industry
• There’s a mismatch between variable demand for space and fixed
warehouse capacity.
• Despite enormous demand for warehouse space, warehouses are
utilized inefficiently. The demand side requires flexibility, yet current
offerings are static.
• Currently no optimized way to connect users in need of space with
suppliers who have excess space.
THE SOLUTION
The Shared Warehouse economy
Unlock warehouse capacity and provide an end-to-end quality service
through a one-stop shop warehousing as a service marketplace (SaaS).
Pallco connects organizations in need of warehouse space with
organizations that have excess capacity while managing the entire
customer experience by facilitating the delivery of goods and
transactions.
• Remove stress of warehouse selection - provide consistent quality
experience via an operator.
• Reduce adoption barrier by eliminating risks associated with
warehousing (e.g. insurance) for both sides of the market.
• Deliver a valuable product that captures data to improve
3 our product automation matching, a basis to build machine learning
capacities.
 On-demand warehousing for business

THE OPPORTUNITY
USD 220M in Mexico City in Overflow Global WMS Market will reach USD $ 3.04B by 2022
 Freight forwarding management software platform

C U R R E N T S TAT U S

Business HQ Maturity state 33 listed

CDMX, Mexico • Portfolio company from
Cobuild. warehouses
• Launched in March
2019.

6K new monthly visits Looking for specific, Capital raise

since launch value-added investors Currently raising funds
47 active quotes, up to $1.5M in a third
representing approx. round (previously
$770k raised $1.3M)
 Other opportunities we have worked on

SaaS for fleet management

FleetFlex gives fleet managers complete control and
visibility over their route optimization and delivery
operations through an all-in-one web platform and
accompanying mobile application for their fleet.

MTP (Massive transformative purpose):

Enable businesses to spend less time worrying about
their fleet operations and more time achieving their
mission.
 Other opportunities we have worked on

Digicargo

A digital ecosystem that revolutionizes the trucking

industry. Targeting the problem of shortage of truck
drivers and the opportunity of a more efficient use of
load volume of trucks on the road.

Stage: Think Phase - Validated idea stage

 Other opportunities we have worked on

Upfarm

Great future for small farmers. THERE IS A MASSIVE OPPORTUNITY TO BUILD A

TECH-ENABLED MANAGED MARKETPLACE IN LATIN
Short-term: AMERICA TO BUY & SELL FRUITS AND VEGETABLES
A marketplace to connect growers and buyers, leveraging on existing
logistics solutions and communities.

Long-term:
Trade between seller and buyer will occur under smart contracts using
intelligent algorithms & financial tools such as futures, designed by a
decentralized ecosystem to increase market opportunities.

Stage:
Think Phase - Validated idea
The future
of logistics
EMAIL US
I N FO @ R O K K 3 R .CO M
Copyr ig ht © 2 02 0 RO KK 3R INC . A ll r ig hts reser ved .