Vector.ai has raised $15 million in a Series A funding round as the company seeks to tackle the growing productivity crisis in international freight forwarding, now a $199 billion market.
The funding will enable the company, which uses machine learning to transform cumbersome and monotonous processes, to accelerate its international expansion plans and build on its reputation as the automated system of choice for the world’s biggest freight forwarders.
Freight forwarders globally, through no fault of their own, lose billions of hours to cumbersome and time-consuming administrative tasks as they process billions of shipments every year. It’s estimated that operational staff at freight forwarders spend one third of each day hunting through customer emails, attachments and legacy computer systems, which is distracting them from higher-value activities and limiting freight forwarders’ ability to scale effectively.
Vector.ai uses machine learning to automate these inefficient and error-prone processes, transforming workforce productivity and eliminating previously siloed workstreams. From straight-through processing of accounts payables, including bill pay, audit and reconciliation, to automated customs declarations and import/export documentation workflows, Vector.ai’s platform enables workers to offload basic tasks and focus on building relationships with customers and suppliers. It also gives freight forwarders greater visibility into ongoing operations, improving collaboration and further increasing productivity.
Demand for Vector.ai has skyrocketed since the release of its first Beta product in late 2020, with the company implementing its technology across Europe, Asia, Australasia, South Africa and the US. In 2021 alone, it has signed up a range of customers – from multi-national to SME freight forwarders – in 20 countries and month-on-month revenue has tripled. Customers include Fracht, EFL, NNR Global Logistics, The Scarbrough Group, Steam Logistics and Navia Freight, as well as several of the world’s top-10 freight forwarders.
James Coombes, Co-Founder and CEO of Vector.ai, comments: “Most employees within freight forwarders spend the majority of their time communicating with the 10-25 different entities that might be associated with a given shipment and coordinating freight movement and documentation. Communication usually runs through email and attachments, so freight forwarders spend countless hours sorting through documents and manually copying data into a Transportation Management System (TMS), their core system of record. But they’re spending far too much time gathering data rather than analysing it, and they’re using outdated tools which are no longer fit for the complexity of today’s operational and logistical demands.
“What’s more, as the volume of freight continues to rise globally – and with the added burden of Brexit and pandemic disruptions such as the recent port closure in China – freight forwarders are facing staffing shortages, steep wage increases, and shipping delays that continue to cost companies money in lost revenue and spoiled goods. They cannot afford to keep wasting time on low-level processing, which is why we created the technology to automate basic tasks. Over the last three years, our team of experts have been building a platform designed to embed machine learning across multiple data sources and functionalities. We are increasing people’s productivity at work through actionable automation. I don’t see any freight forwarder being able to operate competitively in the next few years without technology like ours.”
The funding round is led by Bessemer Venture Partners – the US venture capital giant behind successful investments including LinkedIn, Pinterest and Shopify – and is joined by existing investors Dynamo Ventures and Episode 1. Vector.ai is one of Bessemer Venture Partners’ first investments in the UK as part of its continued expansion plans in Europe.
Mike Droesch, Partner at Bessemer Venture Partners, says: “Vector.ai is one of the early leaders in an emerging category of freight forwarding workflow automation and digitisation tools. It has built an intuitive and industry-focused product – which is already winning over some of the largest freight forwarders – and a team that can deliver outstanding execution. We look forward to helping them continue their mission to transform this operations-intensive industry.”
Founded in 2017, Vector.ai is led by an experienced team of machine learning, product and industry experts. CEO James Coombes has more than ten years’ experience in building and leading customer-facing teams in financial services, commodities and international trade. His Co-Founder Nisarg Mehta, the company’s CTO, is a computer engineering and machine learning specialist, and has worked within leading research teams at Cambridge University and Microsoft Research.
