Technology in shipping has been focused largely around the online booking of containers and rate management platforms, but Silicon Valley’s attention has now fallen on a labour intensive area virtually untouched by start-up technology – the process of booking dry bulk ships.

London-based Shipamax has received USD2.5 million seed investment from venture capitalists to build a data-driven platform for dry bulk shipping and improve the huge administrative burden and error-prone process of booking ships required for the transport of bulk commodities.

The investment is led by Cherubic Ventures, with participation from AME Cloud (Yahoo co-founder Jerry Yang’s fund) and FF Angel (PayPal co-founder Peter Thiel’s fund), and the funding will be aimed at building out the team, accelerating product development and expanding the customer base.

Shipamax, founded in 2016 by CEO Jenna Brown and Fabian Blaicher, plans to become an in industry platform replacing the thousands of unnecessary emails, siloed excel files and instant messages between players required for each booking. It is using technology to bring communications, data and market insight into one platform supporting the dry bulk shipping industry’s move into the digital age.

Brown said over 50% of the work in bulk shipping was centred around communications. “Empowering employees with intuitive technology to increase the efficiency of these interactions will transform this industry in the next five years. And just like no one builds their own database, a technology company is required to provide this solution so the industry can focus on what they do best,” she said.

In bulk tech, there are other innovators, such as New York-based Nautilus Labs that enables shipowners to automatically collect data onboard a ship to help reduce operational costs. The Shipamax solution dovetails with that technology and focuses on commercial teams in the shipping organisations.

The price of booking a bulk ship has dropped by 90% since 2008 and hasn’t recovered since, putting strain on the industry to cut costs and become more data driven, Shipamax pointed out.

“Booking a ship for dry bulk commodities is a slow and painful process. Data is siloed, making it hard to work as a team – shipowners and brokers receive in excess of 5,000 emails daily. Administrative costs are incredibly high with room for error every step of the way.”

This is placing ship brokers under increasing pressure to prove they are still relevant and can add value to the booking process. In addition, shipowners must use all the data they have to improve return on their assets as banks tighten access to capital.

While Shipamax was originally launched as a tech driven ship broker, arising from the founders’ frustrations with the ship booking process, they quickly realised the problem was not the brokers, but the process itself.

“There is fundamentally no modern technology to help brokers provide the seamless experience we’re all used to in the consumer world,” Brown said. Pilots with the new ship booking product were launched in January and have now been rolled out to shipping companies around the world.

There was a measured response to the booking solution from two Asia-based dry bulk ship companies contacted by Fairplay. A spokesman for Hong Kong-listed Pacific Basin agreed that new digital initiatives could improve the work flow, provide more big data analysis, better time and cost management with an increase in information accuracy.

However, the spokesman pointed out that shipping was essentially a people business. “A lot of negotiation and networking work, which done by the shipbrokers within the shipping industry, cannot simply be replaced by computer,” Pacific Basin said.

“We believe the shipbrokers will continue to play an important role in the future especially with the aid from new technology, they are much more knowledgeable, reachable and reliable, and if they digitalise quickly can even possibly increase their value to shipowners.”

Khalid Hashim, managing director of Precious Shipping, said the Bangkok-based carrier used a set of smart electronic ship management modules that allowed for a far greater degree of cooperation between ship staff and office staff, providing a greater degree of information sharing now than ever before.

“My guess is that most shipping companies are using some such system to effectively manage their ships and keep abreast of all the paper work required by the onerous regulatory environment, where it seems that having the right paper work is far more important than real ship management work,” he said.

“If we could be connected to our clients well before the cargo needs to be moved, then we could have a ship in place for that client at the right time and place.”