Recent research by the Boston Consulting Group found that venture capital investment into technology in the shipping and logistics sector totalled $3.3 billion in the last 6 years!

Shipping is recognised as one of the oldest industries in the world, but it is also one of the last to embrace the digital transformation and has been labelled as ‘traditional’. As we are seeing results from digital ventures in the industry, shipping is on the verge of shedding the ‘traditional’ label, but it’s not there just yet.

The signs of change, however, are encouraging. New startups and new ventures are appearing in shipping every day, but Leonardo Zangrando’s (Startup Wharf) research into startups in the maritime industry suggests that many ventures operate under the radar, even though some segments of maritime are actively seeking new talents and innovators.

Marlink’s startup hub is one of those organisations, looking for partnerships that “will accelerate [their] digitalization initiatives”. Ahead of our upcoming GST & Shipping2030 Europe conference in Copenhagen, we caught up with Gennaro Faella, the Head of Strategic Business Development at Marlink, who will lead the dialogue on startup hubs at GST & Shipping2030.

Start-up incubators, accelerators and labs have been appearing across the maritime industry recently. What are they, how do they help a company and why are they important?

“Indeed, you will find a number of start-ups currently in the maritime industry. This industry is in a strong transformation phase, driven by new digital technologies, changing environmental regulations, economic pressure and new threats, such as cyber. Today, shipping companies are under massive pressure to catch up with the rest of the world’s industries when it comes to digitalisation.

Start-ups are bringing fresh ideas, they act as kind of “speed boats” to incubate the development of new technologies, innovations and business models to accelerate the ongoing digital transformation. Eventually they support the maritime customers in their journey into the digital world by developing valuable solutions, applications and tools. Together with startups, companies from various industries – such as satcom support, IT network operators and providers, transportation and logistics, but also universities or technological and regulatory institutions – can create an ecosystem to combine their dedicated expertise and support maritime customers during their journey into the new digital world.”

What are the key differences between how a company partnering with digital start-ups or incubators and a stand-alone traditional company operate?

“The shipping industry is changing in all aspects, including ship management and performance optimization, as well as logistics, transportation, supply chain control etc. By the same token, the technologies used are also evolving with new connectivity providers, multiple satellite constellations, network operators, affordable bandwidth, increased performance, low latency etc., enabling new digital and intelligent applications. Going forward, available bandwidth will drive more applications and vice versa, more applications will drive the need for more bandwidth. They appear like twin waves, disrupting, driving but also optimizing settled and traditional standards and processes in the shipping industry – and for all supply companies dealing with them!

Hence all companies and suppliers involved have the responsibility to make and execute the right decisions to reshape the industry. This complexity can only be managed by companies that are embedded and work inside an ecosystem to fertilize and drive that development. Companies like Marlink, have a thorough understanding how the maritime industry works and work closely with shipping customers to cater for their todays and future needs. These companies need to interact, work and team up with innovative and dynamic start-ups to co-create smarter solutions for their customers. Start-ups are more than the icing on the cake, they can help us to significantly reshape this industry and effectively optimize the business operations for our maritime customers.”

Your lead of this Shipping2030 Start-ups Hub is a sign of Marlink’s purpose to incubate new ideas. Where do these ideas come from and how can you ensure that new ideas will keep coming in?

“We have a very close, open and constructive relationship with our maritime customers, so often new ideas are sparked and fed by our customers directly! They know best what challenges they are facing every day and we help them to optimize vessel operations, enhance crew welfare, while complying with ever-increasing regulations, staying connected to their corporate network, and trimming their communications budget etc. It is important to learn about customers’ issues and find ways that bring simple solutions to complex industry problems. That allows our customers to focus on what they know best: running their vessels and day-to-day business operations!

Our connectivity & IT portfolio, our digital solutions and services are running on an open system, so innovation happens through our in-house technology, engineering and product teams, who have a close link to customers through our sales teams. Also, we are inspired by our strong hardware and technology partner network, and finally, inspirations are born jointly with start-up companies. It’s that constant cycle of co-creation with customers, partners, start-ups and in-house experts, that helps gaining a thorough understanding of maritime challenges. It ensures that new ideas will keep coming in and, most critical, will be effectively solved.”

What are you the most excited about in Marlink’s start-up hub session? Can you share any details of upcoming projects?

“We decided to lead the Shipping2030 Start-up Hub as we see a perfect fit with Marlink’s Digital Strategy. We are enthusiastic to share ideas with start-ups and industry delegates. We scouted start-ups with the assistance of Startup Wharf accelerator from a list of about 150 companies that are innovating fuel efficiency monitoring, ship operations & management, container predictive optimization and crew management, using big data, artificial intelligence, etc.

Co-creation with startup and strategic partners as well as through our digital innovation lab are part of our digital strategy. Those partnerships will accelerate our digitalisation initiatives to provide what we call our “smart connectivity” vision, a fully managed solution designed to securely and remotely manage the customers’ satcoms & IT connectivity network, cyber security, onboard electronics and digital solutions. We give our customers true peace of mind as we ensure their business-critical applications are running safely, securely and reliably – and ideally, fully digital.”

When it comes to technologies and innovative ideas, how do you identify its true value and be impartial to the hype? What is your evaluation process?

“We are the leading player in maritime IT & communications and manage thousands of on board interactions and applications. This expertise and our customer proximity help us to differentiate the real need from the hype or the “nice to haves”. The evaluation process starts from corporate objectives, identifying knowledge and expertise that we want to source to complement our skills and fulfil the needs of our customers. Here, it helps a lot that we understand the maritime (and enterprise) segments and their varying needs as well as the complex customer journey. Very often we also test-bed new solutions with major and global shipping customers. Their feedback is incremental to design the most viable solutions.”

When an idea works, how challenging is scaling up, especially for a global company like yours?

“Global companies like ours constantly learn, innovate and adopt best practices triggered by in-house teams, customers and partners – indeed, also start-ups. Thanks to our entrepreneurship culture, lean hierarchies and brilliant team working, we monitor and manage all stages of design, implementation, test, learn and evaluation.”

Why is Marlink supporting start-ups and what is your strategy on that?

“Marlink is supporting start-ups as they help us to accelerate, execute and constantly innovate our digital strategy. Their fresh ideas combined with our customer proximity and market expertise make the real difference to design and implement business-critical solutions for customers! For example, to combine a new start-up application with our XChange open platform will allow us to effectively and seamlessly integrate a solution which will help to optimize the business operations of our customers. It’s that business-focussed innovation that makes the value for customers, us and the start-ups.”

How is Marlink becoming an incubator for start-ups?

“Marlink is going to be an incubator for the most innovative and relevant start-ups by collaborating with all sides: customers, incubators, strategic industry and digital partners. We will provide start-ups and customers’ incubators with unique opportunities, including exposure, innovation showcase centres, but also access to maritime knowledge and “smart connectivity” enablers, co-creation and prototyping with customers and partners, sea trials, which are incremental for them to experiment, evaluate and scale-up their applications.”

Which start-ups does Marlink support already or is it a new idea?

“Start-up incubation is fairly new in the maritime industry. At Marlink, we need to make sure to identify the best and right start up partners, which can dynamically and effectively turn our customers’ needs into innovative, but efficient solutions – supporting our customers’ unmet business ambitions and needs.

At the same time, we have been working with start-up type companies in the past, for instance on cyber security, telemedicine and e-learning. This is also reflected in the recent acquisition of Palantir, a company specialized in remote IT management. But it is also about being selective in our Merger & Acquisition strategy, like the recent acquisition of Omni Access, a former start-up that succeeded in delivering next generation broadband services and on-board IT solutions to the sophisticated superyacht sector in a few years.”