More than 80 per cent of world freight is transported by sea, with huge container ships carrying everything from vehicles and industrial machinery to raw materials, bulk commodities and finished goods.
Yet while the high seas might be the most efficient way to move goods, Charlie Campbell and Shane Malone, co-founders of Harbour AI, take the view that the industry is stuck in the past when it comes to managing freight forwarding payments.
“For decades, supply and logistics companies have battled the same old problem: cash flow. Payments come in late, debtors take too long to chase, businesses are left struggling to scale, and manual processes and traditional banking methods still predominate,” Charlie Campbell says.
“Harbour AI wants to change this. Our customised fintech platform is built on a simple idea: if you make it easy for someone to pay, they’ll pay faster. If you make it hard, they’ll delay. We know the pain points, we’ve seen the inefficiencies and we’re building the tools to fix them.”
Campbell says that by streamlining payments through open banking, Harbour AI can cut late payments by more than 50 per cent.
“The platform automates invoice reconciliation, strengthens working capital and gives freight forwarders full visibility with a modern dashboard, agent-led collections and direct TMS [transport management systems] integrations.
“Our system suits all types of companies across supply and logistics, but in particular we are focusing on freight forwarders, third-party logistics and customs brokers,” he adds.
“There are over 100,000 freight forwarding companies alone worldwide, and if you add logistics, warehousing and brokers, it’s a huge industry with a lot of potential customers.”
Harbour AI does not need to be regulated as it is not taking payments from customers directly. Instead, it operates via regulated third-party providers known as electronic money institutions.
“We’re in the flow of funds but have no access to the money,” Campbell says. “This was a deliberate strategy on our part as regulation can take a long time, and by the time you get there, what seemed like a good idea has moved on.”
Campbell and Malone met at the Dogpatch Labs founders’ accelerator, where those with good ideas can mingle and join forces to start new companies. Malone comes from a deep tech background with several published academic papers on machine learning under his belt and experience working with Microsoft and Intel.
Investment will be required to help us scale and develop the product
— Charlie Campbell
Campbell studied marketing before embarking on a career that has included his own ecommerce business, raising money for a New York-based start-up, a senior role with LinkedIn and just over two years with Irish fintech unicorn Wayflyer, where he was the sales team lead. The third member of the Harbour AI team, engineer Evan Gordon, was also recruited from the founder’s accelerator, and the company was formed in March this year.
“Harbour AI is really the collision of two worlds. I came from the sales and growth trenches of one of Ireland’s tech unicorns, while Shane cut his teeth in the engineering labs of two of our biggest multinationals. We knew straight away that the mix worked. This is one of the biggest advantages of the accelerator: you’ve got commercial and technical talent, and when you put them together you can build something world-class,” Campbell says.
“As a kid going past Dublin Port, I’d always wondered what was inside all of those stacked containers and then years later, when I was working on container financing at Wayflyer, my childhood curiosity turned into obsession,” he adds.
“I was on the ‘new bets’ team at Wayflyer, which was a bit like an innovation hub within a start-up, and I formed a strong passion for the industry. I also saw first-hand how underserved it is from a tech perspective, making it ripe for disruption.”
And therein lies the company’s biggest challenge: convincing a very traditional industry to change its ways. Campbell says the founders are not underestimating how hard this may be, but he believes that as more companies go digital and younger, more tech-savvy managers take on senior roles, conversion will become easier.
“What we’ve found so far is that once a customer uses Harbour, their late payments drop, cash flow improves and trust is quickly built,” he says.
“At the moment we have pilot customers who are trying out the system for 90 days. At the end of the trial period, the idea is that they will start paying a monthly fee based on the amount they’re transacting through the platform.”
Campbell’s parents are entrepreneurs, and he credits them with introducing Dublin diners to Asian fusion food. He describes his desire to start his own business as “an itch you eventually have to scratch,” adding that “the hardest part for Shane and me was leaving very successful careers to take the leap”.
“Walking away from that kind of stability isn’t easy, financially or personally. But it shows how strongly we believe in fixing this problem. We’re not reckless; we’ve given up a lot to do this.”
“Getting to a minimum viable product [MPV] stage and proving it out isn’t the most expensive part of a startup like ours, but investment will be required to help us scale and develop the product,” Campbell adds. “To date, we’ve had funding of €100,000 from the NDRC. Enterprise Ireland will be supporting us with pre-seed funding, and with a strong investor interest, we are targeting Q4 to open a funding round of €1.5 million.”
Asked what it’s like to start a business with someone you’ve only just met, Campbell says: “If you feel comfortable going for a pint with them or going on a long-haul flight without them annoying you, then you can probably work well together.”