To Fr8 co-founder and CEO Sloane Brakeville, the full range of supply chain logistics challenges can be found in the “last mile,” or the complex series of actions and regulations governing how goods get from the outskirts of a city or a transportation hub to their final destination.
Fr8 is focused on developing protocols and technology that will allow blockchain to reach the long-stated goal of serving as a “single source of truth” for logistics, identifying where any item is at any point in the delivery process.
Brakeville spoke with ThirtyK about the challenges of logistics, the unique problems posed by the last mile and how emerging standards have past precedents. Before joining Fr8, he helped launch IBM’s blockchain business unit and developed proof-of-concept cases for a broad range of industries.
ThirtyK: From blockchain’s earliest days, supply chain was seen as one of the most promising use cases for blockchain. How is Fr8 looking at the space?
Brakeville: When you look at the blockchain as a single source of truth, it’s a perfect use case for that technology. But there’s little understanding the world has around logistics as an industry. It tends to hide in plain sight. People take it for granted and don’t realize how complicated it can be.
Why we’re different is that we’re not trying to [build] any specific application. We’re acknowledging that it needs a protocol.
ThirtyK: The use case you’re focusing on is the “final mile,” more specifically, trucking goods to their final destination. Why?
Brakeville: The final mile sits in a weird purgatory of being regulated and unregulated. Deliveries like produce trucked over 110 miles are regulated, while produce held in a truck for less than four hours is not. Depending on the specific needs of the final mile delivery, you could have a drastically different set of requirements. You have all these different types of drivers with different tools available to them for uploading GPS coordinates, language barriers and routing challenges. You might not be able to drive down certain roads if your truck is too large. To us, this represented this really great diverse set of challenges.
“Protocols that we develop about things we know a lot about, like final-mile trucking, can be extrapolated to address issues like ports, airports, rail yards, warehouses and truck drivers all over the world,” says Brakeville.
It really starts with uncovering those unique requirements and setting up a general-purpose solution [using] a protocol.
ThirtyK: Fr8’s white paper discusses the importance of protocols to address data, payment, regulatory issues and cybersecurity. What do these protocols look like in your model?
Brakeville: From a practical standpoint, we like to talk about protocols as laying down a set of wires. What you do with them is entirely contingent on how many problems you have [to address]. We’re not going to say you have to use this set of data to do this. We’re going to let [the industry] inform us of what they need.
Coming up with solutions to each facet [of logistics] takes a long time. We’re starting with the general wiring and then going use-case specific to see if the wiring will add value.
ThirtyK: How do you approach incentives through your ecosystem, including your planned Fr8 token?
Brakeville: One area we’re seen is the ability to incentivize the behavior of truck drivers. If you don’t have a GPS, we’re going to incentivize you to have a [GPS-enabled] cellphone… Every time you upload a GPS coordinate, we’re willing to deposit a fraction of an Fr8 token. It accumulates over time until [truckers have] paid off their cellphone or [it] becomes a bonus structure they’re rewarded for.
ThirtyK: How do you envision your protocols expanding backwards from the final mile to the full delivery chain?
Brakeville: It’s a tough conversation to have without a specific understanding of how things move [such as] the coordination requirements of something coming from China, traveling across the ocean for two to four weeks, arriving somewhere like the Port of Long Beach and getting somewhere like a rail car for the next step of the journey to a warehouse. [But] when you look at the final mile and the things that have to be shared, the same problem set exists at each stage. A factory in China that schedules a truck to arrive has the same set of problems as the final mile driver in the U.S. Protocols that we develop about things we know a lot about, like final-mile trucking, can be extrapolated to address issues like ports, airports, rail yards, warehouses and truck drivers all over the world.
ThirtyK: Where are you today?
Brakeville: We built a blockchain set of applications to provide visibility about the final mile… to validate our assumptions. We learned a lot about how little information is shared in the market. [But] for their value to be realized, the industry has to come to agreement about the protocol.
ThirtyK: How do you get the industry to adopt protocols and standards?
Brakeville: We’re looking to consortia. We’re members of the Blockchain in Transport Alliance, the largest blockchain consortium for transportation. We’re waiting for them to get their standards organizations and working groups spun up. We’ll share our thoughts and get feedback from the ecosystem through that… and make decisions about how we’ll gain adoption in other ways.
A story I like to tell is about the last time a protocol was adopted in logistics and how valuable it became. In the 1950s and 1960s, [transport entrepreneur] Malcolm McLean evangelized for how standards could help intermodality, moving from ship to rail to truck. It took a while for [them] to be adopted but in the long term the price of moving goods was cut dramatically. It’s a great story about not only the ability of the industry to get behind a standard, but also the value. There’s going to be growing pains, but it’s going to be worth it when we’re able to share information in ways we weren’t able to before.