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Ship first, pay later: How this AI-driven freight tech startup is reshaping the future of supply chain payments
BlueX now has over 13,000 global shippers and carriers using their platform, and the company has seen its revenue grow almost 2,000% since the start of the pandemic. Speaking about what they want to achieve, O’Malley says it’s about connecting global trade online. “What we’ve done today is to grow a global network of logistics buyers and sellers — these are trade technology platforms to access supply chain payments and pay-it-later financing for logistics to simplify their trade.”
Sometimes it takes for things to go wrong before we take notice. Empty supermarket shelves, soaring shipping costs, delays and shortages on everything from laptops to toilet paper — the COVID-19 pandemic has laid bare the fragility of our global supply chains.
But the problems in logistics have long been there before the pandemic, says Sean O’Malley, co-founder and CEO of BlueX Trade. “Covid just accelerated the problems because it’s not just the movement of goods that’s having issues — it’s the movement of capital as well. The movement of capital is tied to the movement of goods and with prices of moving goods having increased by 5-10%, you can imagine how that has stretched the balance sheets of logistics players around the world.”
In an interview with both Sean O’Malley and Vivian Chiang, COO of BlueX Trade, we discuss how their freight tech platform is powering B2B payments for global supply chains, which ultimately tackles the bigger problem of the widening gap we’re seeing in trade finance, now estimated to be $1.7 trillion.
Behind BlueX’s mission and its strategic reasons for choosing Taiwan
Located in the heart of the Asia-Pacific region, Taiwan presents itself as a strategic trade route and location for shipping companies. It’s worthy of note that Taiwan-based companies such as Evergreen, Yang Ming and Wang Hai are some of the largest container shipping companies in the world.
“It’s both a shipping and logistics hub in Asia and it’s a great place to start this type of business because one of our earliest customers was Evergreen,” says O’Malley about why he chose Taiwan to build up his startup as it provides proximity to some of his key clients. “Additionally, from a talent perspective, Taiwan has great engineering talent.”
BlueX now has over 13,000 global shippers and carriers using their platform, and the company has seen its revenue grow almost 2,000% since the start of the pandemic. Speaking about what they want to achieve, O’Malley says it’s about connecting global trade online. “What we’ve done today is to grow a global network of logistics buyers and sellers — these are trade technology platforms to access supply chain payments and pay-it-later financing for logistics to simplify their trade.”
“Small to medium enterprises (SMEs) have been hugely underserved with the types of tools they have to move capital across borders,” continues O’Malley as he highlights the importance of enabling more digital payment solutions for SMEs to access. “So if you think of SMEs shipping things to the US, their balance sheets are stretched tremendously. On top of that, their vendors are requiring them to pay in fast fashion too because they want to receive their capital faster. So what we want to solve is the issue of capital movement so that customers who use our platform have the ability to move capital globally on an instantaneous basis.”
Building the Paypal of logistics to help with cash flow challenges facing SMEs
To help global shippers deal with the increased costs and volatility in ocean trade, BlueX recently launched a new product, BlueX Pay-it-Later, which helps qualified SMEs quickly gain access to funds needed to pay for rising logistics costs like ocean freight, demurrage, and gate fees, 30 to 60 days later.
O’Malley says rising logistics costs has been a pain point they’ve heard from the market especially for SMEs who need additional capital to help with cash flow needs. “A transaction size can reach up to US$1 million, and this product has been well received among our customers as we’ve seen tremendous growth since the launch.”
“Going to the root of what we’re doing here with this new product is that we want to be the Paypal of logistics to allow users to transact seamlessly and have access to pay-it-later financing solutions,” adds Chiang.
Taking us through how their latest fintech offering works, O’Malley says: “For example, if you’re an importer, you’re probably moving cargo, let's say via Evergreen. You want to pay for that cargo movement but you don’t want to pay right now as your balance sheets are stretched. If you want to pay in 30 to 60 days later then you would use our products. We have relationships with all the major carriers of the world to direct payments. So all you need to do is sign up to BlueX Pay, upload your invoice and direct the payment to Evergreen, and you’ll pay us 30 to 60 days later.”
Building a world class company with world class products
Founded in 2019, the fast-growing startup now has a team of over 40 employees in Taipei and in the US. “Our goal is to build a world-class company with world class tools. Taiwan is known for its fantastic tech talent and any company is a combination of technology and business know-how and we’ve been able to do that at BlueX,” says O’Malley on how he is building a global tech company. “We run our company like a Silicon Valley startup because that’s where Vivian and my roots are from. So there’s a unique culture associated with that — building great products, listening to your customers, being data-driven and having the grit to grind out product-market fit. This is what characterizes the company from the ground up.”
When it comes to attracting and retaining young software talent, the management team at BlueX leverages technology to change the perception people still have for the logistics sector. “When you think of logistics you might think it’s sort of old, boring and traditional, but I think that’s where the opportunity lies,” says Chiang. “We’ve developed a lot of tech to make it more forward-thinking, for example, our dynamic pricing product that uses AI. We have a team of great data scientists who use ML algorithms to build powerful engines that can match supply and demand. You wouldn’t think naturally that would be in the logistics industry but we’ve really looked at how to leverage new tools and tech and apply them in this more traditional space to make things more efficient.”
Speaking about his own passion for building global teams and products, O’Malley says many people might not be able to comprehend just how big this industry is. “The size of this industry is incredibly big. About 77 million containers are moved globally every year and the value of a container can be that of a house.” Just recently one of their clients shipped a 40 foot container containing dried abalone which was valued up to US$1 million.
“The size in this market is into trillions in terms of the value of goods being moved, '' O'Malley adds, ”so you can imagine volatility in this market can impact the whole world, like when a cargo ship was stuck in a canal — we’re talking about one canal affecting the entire world of goods. So the platform we’re building, we’re touching the entire world and this is the type of impact that gets me excited because I love building products that can impact the world.”
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