Weft & Incremental Iteration
This is the story of how Weft began and how they turned a bike tracker into a logistics optimization company, as told by its founder & CEO, Marc Held. They’ve received funding from Andreessen Horowitz and early-stage venture fund Data Elite, among other investors.
How It All Started
I moved to San Francisco in 2012 when I went to attend a Quantified Self Conference. I fell in love with California the minute I got there and canceled my return flight — which was probably one of the craziest things I’ve ever done. I had absolutely nowhere to stay, knew probably two other people out in SF, and was just coming off the tail-end of a big project.
After a few days of AirBnb-ing, I ended up crashing at a hacker hostel in deep SOMA. The very first week I moved into the hacker hostel, someone managed to break in and steal a bunch of relatively expensive bikes. Being the engineer that I am, I made a quick prototype for a bike tracker using some hardware I had lying around, plus a couple other things I had to grab on Sparkfun.
I’m not a particularly good engineer, but I know enough to be dangerous, so putting together a rudimentary prototype wasn’t particularly challenging, however I knew there was absolutely no way I would be able to design a production-ready piece of hardware, so that product pretty much stopped before it started.
Plus I soon realised that bike tracker market isn’t huge. So I let the project to the side.
Weft was a solution looking for a fitting problem.
Finding the Problem
I go to Barcelona for Mobile World Congress every year because I’m a huge nerd; and that year I happened to overhear that someone was having problems with their shipping containers being stolen. Considering my experience in the tracking world, that idea sparked some interest. I did a little bit of research to size the market and the numbers that I stumbled upon almost convinced me that I might be able to make something interesting with the prototype I already had.
It turns out that $35B of value gets destroyed every year in the US alone due to shrinkage (shipping term that relates to things such as theft and spoilage).
I thought that we could re-purpose the hardware that we’d already created by adding a couple of extra sensors to track not only the location of a shipping container but also its environment, theoretically reducing all the waste due to cargo shrink or at least provide visibility; but the fact that there was so much competition in the market really put me off, and I still wasn’t convinced it was worth tackling, because the existing players in the market seemed well-entrenched and I suspected that it was going to be a difficult market to crack.
Eventually I found myself at the very first Enterprise Startup Weekend (I started my first company at a Startup Weekend event a few years ago, so I like to show up to these every once in a while). It didn’t seem like my skill-set was incredibly valuable to the folks there, so I decided to spend a little bit of time imagining a solid use case for the hardware I had made.
At this point, I’d done a bunch of customer development and one of the major things that came up in conversation was the fact that nobody inside of the supply chain knew what was going on, so I whipped together a full-stack logistics visibility tool that was augmented by my hardware — which placed first at the startup competition. This was the first sign of potential validation, which turned out to be false.
We’ve definitely refined the product quite a bit since then (after bringing together a great team, running some pilots, and even raising some seed capital) and the longer I spend in logistics, the more I learn that there’s a whole lot left to automate.
My prior experience & professional network helped land seed funding and the pilots.
The Market
Logistics is a big-ass industry (that’s a technical term) and there are generally a lot of people that touch the shipping process. As a result of sheer number of interacting parts, there are countless areas that can be optimized and automated, ranging from pre-shipping, to the actual shipping, and processing at ports of arrival. Heck, logistics as we know it today is a relatively recent thing; it was only the 1970s when someone realized that having an indivisible, standard unit of shipments would be able to reduce loading time by multiple orders of magnitude! Before the shipping container it would take days to load a container ship, whereas now it only takes a few hours. There are still a lot of areas within logistics to left to optimize, we just thought a good start would be to make sure that everybody in the supply chain is on the same page.
This suboptimal state extends to the entire shipping process, as there are losses incurred by shippers and ports due to various inefficiencies such as delays, errors, inefficient routing, or underutilisation.
We simply wanted to provide a service to help make sure that everybody was on the same page.
Our Thoughts
Weft is a canonical example of gradual product refinement. Product visions are made clearer through immersion & increase of familiarity with a particular market, in response to which you refine your product, incorporating the newly gained information.
In other words, discovering all that an industry entails, its intricacies and peculiarities — immersing yourself in it, enables you to create the ideal product to tackle a particular problem.
Ensure that the market is large enough to make it a worthwhile pursuit.
The opportunities and accompanying challenges ahead of Weft in the logistics industry are quite substantial, and we wish Weft and the Weft team the best of luck.
Press:
Weft gets backing from Andreessen Horowitz, aims for $5M Series A
Update: Weft was acquired by Genscape for an undisclosed amount in June 2016.
