Today we present you Frankfurt Forward’s Startup of the Month – March 2019 – as Media Partner.
In this interview, we are talking to Murat Karakaya (https://www.linkedin.com/in/muratkarakaya1/) Chief Operating Officer and Co-Founder of Frankfurt-based logistics startup CargoSteps (https://www.cargosteps.com/). As you may be able to see in the back, there is Frankfurt Airport, since they are currently located in the House of Logistics and Mobility (HOLM), very close to Terminal 2. You can learn more here: https://www.frankfurt-holm.de/de
In this interview, we talk to Murat about “Airplane on the ground” shipments, their high-speed freight platform, their nice location and why a logistics startup may not want to move to Berlin.
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“With the Frankfurt Airport, we have lots of business here”
“We are in the middle of Germany”
“Companies [and freight] from all over Europe are crossing just behind us …”
“Startuprad.io: Why did you never go to Berlin? Murat: We need a working airport”
Announcer: Welcome to Startuprad.io your podcast and YouTube blog covering the German start-up scene with news interviews and live events.
Joe: Hello and welcome everybody this is Joe from celebrated io your start-up podcast and YouTube blog from Germany. Today once again with the start-up of the month in our media partnership with Frankfurt Forward. As you may be able to see here in the back, we do have terminal two of the Frankfurt Airport. And there is a reason for that because I do an interview with the logistics start-up hey welcome.
Murat: Hey, nice to meet you.
Joe: Can you introduce yourself with a name, with your job and what you do?
Murat: Well yeah, my name is Murat Karakaya I am chief operating officer and co-founder of Cargosteps. We’re a software logistics start-up sitting here at Frankfurt. And Frankfurt at the moment in the house of logistics mobility. That’s the building where we are that’s why we’re so close to the airport.
Joe: Yeah it’s actually it’s really fancy when you come here and you see all the planes taking off and all the planes parking. But we both have to be in focus otherwise you could see a lot of action going on in the back at the airport. So, basically when we talked before you’ve been telling me what you guys actually doing and it has a lot to do with very urgent parcels. Very small packages, maybe even letters, spare parts you guys are helping to send how is the business actually constructed you are helping in and what do you do differently?
Murat: So, what we do is we help freight forwarders and carriers to use their excess capacities and enable cross company track and trace. We do that with the web application for companies and an API and on the other side mobile app for drivers. And we’re focused on the b2b express and career logistics worldwide. So, an example maybe that helps people understand what that is because usually in unsexy area, an unsexy business. And not everyone knows it may be privately you know stuff when you see trucks on the highways or when you see someone FedEx in you something. But the logistics is a really huge market with lots of areas and it’s a fragmented business. Well you have lots of small to medium sized companies the large corporations usually have just a tiny bit of market share. And that’s where the problem comes in that we are trying to solve.
Joe: As you told me when we talked before, many of those really small companies have like one employee, three employees, five employees very small businesses right?
Murat: Absolutely and that’s the point, with this small size companies you some of them you can’t even find with a website or something. And how will you even start cross company functions with them, communication processes with them? That’s not easy and we’re solving that with our solution with Cargosteps. Let me maybe give you guys an example, let’s say there is a company who has a spare part for a factory being Frankfurt and they needed to be shipped to Brussels in Belgium. And what do? They call a freight forwarder; the freight forwarder usually doesn’t have his own vehicle fleet. What he does is he calls subcontractors, carrier companies who maybe call subcontractors and so on. That’s the normal day-to-day business, that’s how it works and it’s nothing uncommon it’s the usual business. And the freight forwarder has maybe a software solution for their forwarding but the rest below them doesn’t don’t have anything. And with Cargosteps you have a certain standardized process that works across until the one-man company even is included. And that’s really easy peasy, at the moment let’s say the spare part is really important so the company would call you six seven times per hour. And the dispatcher of the freight forwarder will lose a lot of time to get this information for them so gets receives the call from the customer. And starts calling the chain up until the driver is reached, so the driver give you gives you a status update. It’s not just important to know where your shipment is that you can do since I don’t know many years with tracking devices in cars or in shipments. But the new quality is to also receive proactively updates. So, what was done when was it done and everything and received pictures of the status of the shipment maybe off the proof of delivery the receipt the signatures who did you hand it over to, who was the person you gave it to? Because sometimes shipments get lost or missing and they’re really urgent.
Joe: Because you just handed it over to the wrong person.
Murat: It could be, or one person got it put it to the side and it’s just sitting there and no one knows where it is. So, you can ask the right person, so you have total transparency worldwide from door to door doesn’t matter how large your shipment is. It could be documents, could be spare parts could be Pharma shipments medicine whatever. Oh yeah, he told me for example there’s some cases when a plane cannot take off just for one screw or something and that’s the parts we’re talking about right? For example, not just them but that’s shipments and aircraft on ground shipments. So, the plane waits until this shipment arrives maybe it’s for something else or it’s for the plane Itself. Maybe it’s just a screw or something they need. But they need this certified screw because without them they’re not allowed to depart and that’s a really common thing. There are 7 billion shipments worldwide just in this b2b expressing career business every year. And with us you have this workflow there’s new workflow.
Joe: And how does it actually work, the driver gets something like an app he has on his cell phone?
Murat: Yeah, so drivers can download our iOS or Android app and have it on their phone.
Joe: No windows phone?
Murat: Yeah, no I mean the less and fewer people using those so there’s no need, I think. And smaller companies use up web applications. So, they go on our website cargosteps.com and they just sign up one time if they’re subcontractors if they’re employees and that’s it. And if you have worked with new people you just send them an invitation and then you’re connected like LinkedIn or something. And you just can work with everyone worldwide immediately with the same process with everyone. So, you have a certain standard that you can provide your customers. And by using cargo steps dispatchers in the office do fewer calls, make fewer mistakes, save a lot of time. So, the evaluations that we have from our 1,300 companies that are using Cargosteps at the moment is they save up to an hour some, even more, depending on the volume of their shipments per day, per dispatcher, per day. So, that’s a huge time-saving and the day to day business got a lot easier too. That’s the feedback we get and if you’re a larger company you have just use our API because you have maybe existing systems in place. And you don’t want to learn something new or use two systems separately so we can implement Cargosteps as a form of an add-on into transport management systems. And other forwarding software and yeah just connect everyone involved worldwide. That improves a lot of stuff and solves a lot of problems for the companies which makes us happy too because we know we’re doing the right thing and yeah.
Joe: That is really interesting everybody who would like to learn more go down here in the show notes we’ll have your LinkedIn profile as well as the URL of the company. So, they can check it out but we are here since your start-up of the month Frankfurt. And just a tiny hint with the airport here in the back how important is Frankfurt for you for logistics for Cargosteps?
Murat: Yeah usually most start-ups are somehow connected to maybe Hamburg in Germany because of the huge harbor and the ships. You have to see freight business but that’s not the only logistics that’s happening with the Frankfurt Airport which is one of the largest in Europe. You have lots of business here, we’re in the middle of Germany lots of companies from all over Europe are crossing right here behind us on the highway.
Joe: And you cannot see but that that is one of the busiest highways in Germany. As well here on the back in the back and I do believe that’s important because you got a lot of train connections here you got the airport which does a lot of passengers but also a lot of freight. Many people don’t know and all the streets highways outer bands and so on and so forth.
Murat: Yes, so the infrastructure is really good for logistics here and I think the Rhine mine regions even the 10 strongest business area in the whole European Union. Which makes it pretty busy yeah.
Joe: Oh, I just got the number for the gross regional product of the crater ride mine area is approximately the size of the GDP of Pakistan.
Murat: It’s not bad I think right? Can’t compete let’s say it like that and yeah, we’re from here so we’re based here we were born here all around my co-founders and me. And so just made sense our logistics network that we had before we started off with Cargosteps from here.
Joe: We may also hint for since most YouTube traffic is coming from Brazil Bon dia do we may add that Frankfurt is very close to the middle of Germany. As well as very close to the middle of Europe, the European Union. So, it’s a really good place to be especially for logistics.
Murat: Absolutely and while we’re focusing on this Express and courier shipments it’s also interesting because of the airport we have lots of air freight. And Cargosteps provides worldwide service. So, let’s say you’re you have something starting off here needs to depart by plane arrives I don’t know in New York and needs to go to New Hyde Park on Long Island let’s say. We can just display all this process all these brakes and steps and connect everyone involved from door to door. Well, that’s what we mean and that’s why the airport is important too.
Joe: Many start-ups are actually not in Frankfurt but there are located in Berlin why did you never go there?
Murat: I mean there are lots of investors and everything but for us, it’s important with the Frankfurt Airport that we have a working airport. And I’m sorry about that for Berlin but it’s really important for us and we need that yeah.
Joe: I never forget the very good logistics position here or Frankfurt it has one of the busiest airport busiest train tracks busiest outer bands all around here. And there are many actually aggregating around Frankfurt plus it’s almost in the middle of Germany plus it’s almost in the middle of Europe.
Murat: It’s a great location actually yeah. It’s a really good location.
Joe: And do you have a little bit of a lookout what you guys actually planning to do?
Murat: Yeah, absolutely so the tracking that I just described is our track and trace solution is our core software or core tool. But on top, as I started at the beginning, we also help for us to find backload so in this Express business. It’s 94 more than 95 percent of the vehicles drive home empty because they’re too small. The companies don’t have customer base outside of their home stations let’s say from Frankfurt if they drive to Berlin, they don’t know anyone in Berlin. They just deliver and drive home empty.
Joe: And they don’t have afraid to pick up on the way back?
Murat: Absolutely and our system will automatically find them a fitting backload, checking on the times, the routes, the capacities even the certifications and trainings. Not every driver is allowed to transport every shipment so we checked that everything in real time. And offer them something on the way home so the freight forwarder saves money. We give them the shipment back and they earn money on their way home it’s a win-win. And even saves a lot of carbon dioxide because you don’t need vehicles to do the same stuff you can just utilize what you have already on the streets. That’s a large part that’s the next thing we’ll launch when we have enough users. But we’re also for example working here with Frankfurt Airport with Fraunhofer Institute and few logistics companies, automated driving here on in the cargo city of the Airport. Because yeah, we do process optimization and open up ramps for the trucker’s so the loading times and unloading times drop significantly and yeah. There will be an inner warehouse transportation from warehouse to warehouse in the cargo city, on the streets within the automated vehicle. And you win the second year of this project which is funded by the state here actually. And that’s one thing we’re doing but more interesting I think we’ll also go and do more for airlines and airports worldwide too. We’re building in an intelligent solution that works with predictive models and knows exactly status of shipment worldwide. And can open up weak spots in the supply chain of airports, airlines can tell them which cargo handling partner on a certain Airport. If a certain airline is not performing good missed its flights for shipments. Or something gets broken or missing stolen and stuff like that so we help them to and so they can even optimize that. And there will be less delays and more on-time shipments – yeah a little bit more but that would yeah if you have questions just ask us you can contact us.
Joe: Down here in the show notes you’ll find all the relevant contact information, like LinkedIn like your website.
Murat: And if you have one more thing if you have time and if you’re in logistics in June the huge transport logistics Fair in Munich is again like every two years. And it’s the largest worldwide actually in the most important in this business and we’re in the hall b1 in the air cargo hall. So, everyone knows that hall who’s in logistics just come to our booth meet us and talk to us we’re happy to see you and answer your questions. And hopefully get to use you get to use Cargosteps and test it out.
Joe: Great thank you very much for making the time for us especially on this very special day for you because it’s his birthday congratulation.
Murat: Thank you.
Joe: You’re very welcome.
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