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Smart People IoT: Fedex for freight

Ryan Petersen of Flexport

Package tracking has been around for years and generally involves small parcels, so keeping tabs on them with barcodes or wireless-emitting RFID chips is fairly straightforward.

Iot Smart People: Ryan Peterson Flexport - IoT Tracking Smart Industry 1/2018

Global logistics companies have to do much more heavy lifting, and the systems in use today are, to say the least, slightly antiquated. At least, that’s what Ryan Petersen believes and it’s the reason he founded his own company called Flexport. It all started in San Francisco back in 2013 with a deceivingly simple goal: “We want to do for freight shipping what FedEx does for small packages.” At least, that’s what Ryan Petersen believes and it’s the reason he founded his own company called Flexport. It all started in San Francisco back in 2013 with a deceivingly simple goal: “We want to do for freight shipping what FedEx does for small packages.” Five years later, Flexport has become a $9bn business and one of the fastest growing companies in the world of freight forwarding – but it still relies mainly on faxes and phone calls to coordinate its delivery chains.

Before we came along, there was no tracking. It was a relay race of paper document hand-offs.

Ryan Petersen

 

Petersen describes how the process works: “Freight forwarding involves lots of different companies. The freight leaves a factory in China, gets picked up by a trucking company, it’s routed to a warehouse, loaded into a container where it gets combined with other people’s products. Another company transports it to the port, where it clears customs. Then it’s put on a ship that’s owned by yet another company and brought to the US where the whole thing happens again, with a customs clearance, a truck to the warehouse, and another truck to a customer. But often stuff gets delayed along the way. Twenty phone calls later you fnd out it isn’t where you thought it was.”
That was the problem he set out to solve. “Before we came along, there was no tracking. It was a relay race of paper document hand-offs.” His frst step was to found a company that sold data about imports, which he called ImportGenius. In the USA, shipping manifests are a matter of public record.

We took all of the government data, organized it and sold subscriptions to our database for $200 a month,

he recounts. It was then Petersen had a legendary run-in with none other than Apple’s boss Steve Jobs. It turned out that Apple’s shipping records were also stored in the government database, and Petersen noticed the company was shipping something described in the manifesto as electric computers. “I decided that had to be some kind of a code name, I did some research. This was just before Apple launched the second iPhone.” Petersen wrote about it in his blog, and the news went viral. “There were more than 100 newspaper articles about it, and us,” he recalls
Soon after, a US Customs employee rang up and told Petersen Steve Jobs had called – and Apple’s CEO was not pleased. “In fact, he screamed at him,” Petersen says. “Obviously, Jobs didn’t understand how things worked.” Petersen subsequently decided to found Flexport, a company that would be based on all kinds of data available in the world of shipping.

In the future, we’ll live in a world where machines talk to other machines,

he believes. But the world that he entered still had people calling each other or sending faxes. Something had to change. “We’ve been steadily chipping away at those processes,” Petersen declares. With close to $100m in funding under his belt, Petersen now fnds time to advise would-be entrepreneurs. He feels the most important tip is: “Don’t wait for someone else’s permission to do your business. First, make certain that other people see the same problem and will be willing to pay for your solution to it. Talk to users non-stop, and build things based on their feedback. Until you have product–market ft, any time spent doing anything that’s either not talking to users or building something they want is wasted.”

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