The road transportation sector in India is ripe for disruptive changes with the new breed of logisticians challenging the status quo. Bringing transparency, speed and reliability into this business through technology is what keeps BlackBuck busy, highlights Rajesh Yabaji, Co-founder & CEO, BlackBuck.
How did this interesting idea strike you?
During my stint at ITC, I led the task of transforming the supply chain. Freight was an area, which took a high spread of costs and it was really difficult to execute any change in the way things were executed. It was clearly acknowledged that there has to be a different entity, which needs to execute freight seamlessly. The idea of building BlackBuck came across during this stint, met Subbu and Chanakya (Cofounders) with whom I shared similar passion for this industry and to bring in positive impact. This is how BlackBuck was born.
How difficult was it for you to execute such an idea and bring it to life?
When we started the business, we had no support from both customers and supply partners since we were new in the market. This phase was critical as we had to establish ourselves and prove the value we were bringing to the table, both for our customers and supply partners. The perseverance and the BlackBuck spirit demonstrated by the team lifted us from the ground and took our scale through the roof. I think it’s important that quality time and effort is spent on all problems. Every problem you solve helps you add value to the business.
Marrying technology with supply chain seems quite promising for India growth trajectory. How do you plan to take this ahead?
Technology penetration in logistics is at the lowest. BlackBuck has built technology, which integrates both demand and supply on to a single platform. BlackBuck works with B2B customers through tech-integrated platforms, where they can place orders very simply. Transporters across the country are empanelled on the platform through a mobile application, through which they interact with us. Transporters through the platform have real-time visibility of customers’ demand. The entire transaction has been made seamless for the ecosystem using technology.
We want to see the world of transportation to be run using technology completely. We believe this would be the best way to execute freight, which will make us the largest freight company in short-term. In the long run, we are looking at possibilities of launching multiple business segments and also taking the story global.
How promising is the logistics landscape that you started your IT venture into this stream?
The logistics industry of freight contributes to 6% of India’s GDP. Majority of this portion is intercity logistics. It is estimated to be a $100 Billion market in India. The logistics industry has always grown 2X the GDP growth. The current players operating in transportation are asset-light and very fragmented. The suppliers to them again are completely fragmented with average ownership of 3 trucks per person. The business in this industry happens in a broken offline method. BlackBuck is looking at this huge market to recreate logistics commerce using technology, building a platform where buyers and sellers of freight can engage seamlessly.
How has been the journey of one year so far? What are the crucial learnings you gained out of operating in such a complex industry?
It has really been a great experience so far. All our memories have turned very sweet, taught us a lot, and seasoned a baby BlackBuck into a commanding and dominant position. What was more important in all these instances was perseverance. We faced many challenges while we were building the business. The perseverance with which the team tackled these challenges is really commendable. The most exciting aspect is that every day is a new day; every week has its own challenges. In start-ups, the goal-post you are hitting at continuously changes, the product you build for X scale does not hold good when you are at 10X; the environment is too dynamic.
How did you develop a truly rewarding team brimming with motivation and destined to change the logistics landscape?
Majority of our hiring is through referrals. Our first fifty employees were hired from very close circle of co-founders. We look for certain personal traits before we onboard any new member in our team so that there is coherence among the employees. We speak the same language; how to abandon age-old practices plaguing the industry and simplify the freight for all the stakeholders. Also, none of our employees, apart from three co-founders, have any prior experience in logistics. This is a conscious call, so that we do not take any time to unlearn.
What are the inspiring class room lessons that you have adopted in your venture?
Supply chain was very dear to me in college. I was lucky to get a chance of picking up my career at ITC in supply chain. I applied a lot of best practices learnt at IIT-K during my stint at ITC, and I still keep applying those best practices best suited to our business proposition. Moreover M&A electives in school helped structure the company effectively.
Do you feel any gap between academics and implementing that idea into business? How can we bridge that?
I think this question is asked and debated a lot. I guess academia can do so much for an individual. It has the core job of making individuals aware of things which they can face. When the person faces these scenarios in real-time, he or she should connect the learnings and execute with the best of the knowledge. Speaking about the academia research and practice, a lot of gap is still present. That is more because of the lack of integrating levers between them.
What are future projects that you are excited to work on?
We are building an engagement platform for the truckers where their entire life cycle will be captured right from buying trucks to purchasing all the inputs for their trucks to selling trucks. We have started a lot of such initiatives and are at different stages of execution. This is going to be a challenging and time consuming task but certainly worth doing.
How difficult was it to convince investors to put in money on your project? How do you see the scenario shaping up in times to come?
It was not very difficult to convince investors. I believe that there are multiple factors which attracted the investors to our business – the market size, value creation opportunities, key difference being created by the company and the founding team. Getting these right in your business model will excite every early stage investor. Scenarios always remain same for great companies.
What keeps you going on time every time?
It is very rare that people get a chance to do something radical, disrupt a large industry. We believe we have a shot. All BlackBuck’ers are inspired and motivated to create this change. We will be at it, until it happens!! The direction is clear for us – We will win this game of freight, not only in India but across the world!!
What are the inefficiencies plaguing the industry and how is BlackBuck positioned to streamline them?
Logistics industry in India is highly unorganized and non-transparent. There is a huge asymmetry of information; the industry lacks trust. The technology penetration is at the lowest. The commerce happens in broken and offline method. BlackBuck keeps technology at the core of its overall offering and is committed to solve the age-old practices plaguing the industry:
- Direct procurement channel- BlackBuck’s direct procurement platform aggregates the supply from the freight market. This ensures availability of freight to the customers in the most reliable fashion. Depending on demand, continuous aggregation and empanelment is taken up for the BlackBuck platform.
- Quality Benchmarking- Trucks are empanelled through a standard quality auditing and verification process, which ensures quality shipping standards. BlackBuck audits trucks at periodic intervals depending on the industry of usage.
- Monitoring and control- With investment in technology in the empanelled trucks, BlackBuck delivers track and trace facility for its customers where the entire shipment can be monitored from the placement at source to dispatch after the unloading process at the destination. With its proprietary geofencing technology, it authenticates all the process parameters of execution.
- Transportation analytics- Data analytics on overall transportation provides all the information to the customer in a single view, helping the customer effectively manage transportation.
GST is seen as the real revolutionary moment for supply chain. Your take on this…
Overall GST bodes well for the entire logistics industry. The supply chain networks will become more business efficient rather than tax efficient. We have reasons to believe that optimized supply chain networks will demand increase in long hauls. For an organization doing business in intercity transportation, this is definitely a plus point. Also, I believe that implementation of GST will completely de-bottleneck multiple constraints in this segment.
BlackBuck, founded in 2015, empowers countless businesses realize their full potential by providing effective technology solutions. These include smart, easy and economical ‘Online booking of trucks, tracking and management of the transportation’ for the customers, optimal utilization and effective management of the fleet for the truck owners and improved network of facilities and support for the truck drivers. BlackBuck is supported by the best of the investors’ fraternity that includes Accel Partners, Tiger Global, Flipkart, Apoletto Asia.