September 23, 2025 • 39 mins
The global barge industry, a roughly $140 billion market, is critical for moving bulk commodities that fuel economic growth. Freight includes petroleum and related products, coal and agricultural goods. In this Talking Transports podcast, Jason Aristides, OpenTug’s CEO and co-founder, joins Lee Klaskow, Bloomberg Intelligence senior transportation and logistics analyst, to share how the company is bringing visibility and predictability to the fragmented industry through its AI-fueled platform. This should help both shippers and asset owners make more informed decisions, drive productivity and improve returns. Aristides also talks opportunities for modal share growth, his entrepreneurial journey, infrastructure investments and how he gravitated to the industry.
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Episode Transcript
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Speaker 1 (00:07):
Hi everyone, this is Lee Clasgow and we're Talking Transports.
Welcome to Bloomberg Intelligence Talking Transports podcast. I'm your host,
Lee Klasgow, Senior Freight, transportation and logistics analysts at Bloomberg Intelligence,
Bloomberg's in house research arm of almost five hundred analysts
and strategists around the world. A quick public service announcement
before we dive in. Your support is instrumental to keep
(00:30):
bringing great guests and conversations to you, our listeners, and
we need your support. So please, if you enjoy this podcast,
share it, like it and leave a comment. Also, if
you've got ideas, feedback, or just want to talk transports,
I'm always happy to connect. You can find me on
the Bloomberg terminal, on LinkedIn, or on Twitter at Logistics Lead.
(00:50):
I'm very excited to have Jason Aristides, the CEO and
co founder of opentug. Aristides leverage is extensive background, spending
five years in software development and roll at companies like
Foss and Curtin Maritime to launch opentug in twenty nineteen.
His mission is to introduce advanced technologies that optimizes marine logistics,
(01:11):
boost industry competitiveness, and elevates services for shippers globally. Welcome
to talking transports, Jason.
Speaker 2 (01:20):
Thank you very much. Lee really excited to be here.
Speaker 1 (01:23):
Yeah, and you know we're excited to have you. We
actually haven't done much on the barge or tug industry
or inland waterways. You know, if you if you can't,
just before we dive into that, can you just talk about,
you know about opent tug.
Speaker 2 (01:37):
Definitely happy to talk about open tugt opent tug has
been my mission, my passion since I entered my working career,
and I think to understand open tugt It's great to
talk about just the tug and barge industry in general
because it really drives why I'm building this business, and ultimately,
(01:58):
the tug and barge industry has been and leverage since
the time of building pyramids. The pyramids were actually built
using barges floating rocks down the Nile River, and it
has been core to transportation since the dawn of time.
But it's also a mode of transportation that few people
(02:18):
really focus on or understand how to leverage. And it's
also one of America's greatest competitive advantages. We have twenty
five thousand miles of coastline and inland waterways that can
serve over fifty percent of the US population at a
costs that's almost it's a fraction of what it costs
to move cargo over the road, and even half as
(02:41):
much as moving cargo by rail. So when I saw
this mode of transportation that's so highly efficient yet is
away from the public eye, I realized there was a
great opportunity to help this industry by providing best in
class technology that helps more shippers stock to use barges
(03:01):
and help some barge companies optimize their operations so they
can provide best in class service. And I started the
company after working in the tug and barge industry and
have evolved over time, starting with my two great friends
and co founders, and over the last year we've tripled
in size and are working with some of the greatest
(03:24):
shippers and carriers in the game.
Speaker 1 (03:27):
And so are you are you self funded? Are do
you guys like venture capitalist private equity? Can you talk
a little bit about your investors?
Speaker 2 (03:36):
Yeah, we're a venture backed company. We work with some
tremendous software investors along with great maritime investors. My former
employer at FOSS was also one of the people who
helped get us off the ground. And then we started
working with a wonderful venture fund called Entrada who's helped
(03:57):
launch some massive public companies along with TMV, which is
a maritime venture fund, and they have a great deal
of knowledge family who owns that owns a shipping line.
And we've been able to blend the best software investors
with the best maritime investors to create a board and
(04:19):
a group of investors that can help us build the
best technology for the right people.
Speaker 1 (04:25):
See can you talk about like you know, so what
does opentug do. Are you a platform for shippers or
a platform for capacity providers or both?
Speaker 2 (04:34):
We're a platform for the ecosystem, and the barge industry
is truly an ecosystem. On every barge transaction, you have
the charters who are actually chartering the barge. You have
the carriers, the fleets, the terminals, and one of the
big inefficiencies in the barge industry is a lack of
predictability and visibility. You know, we're subject to mother nature,
(04:55):
rivers are always changing, and barges are untracked. So and
TUG deploys tracking devices across all these barges, and we
provide an end to end software and GPS service that
helps our customers, whether you're a carrier shipper, optimize your
demand planning. So we use AI to capture all the
(05:17):
orders that people need to move, and then we help
automatically identify, based on our own proprietary model, which barges
in your fleet or across your group of assets, our
best and lowest costs to serve these loads. We then
track the barges, and we're one of the only companies
who are actually tracking real barges across the system. Ships
(05:40):
have AIS, barges do not, which means you can only
track the tug pulling it. Then we predict ETA's share
the ETAs with the people who need to know. We
then estimate the costs of how much it took to
actually move all of the equipment, compare it to the invoices,
help the carrier generate the invoice quickly, help the shipper
(06:04):
validate their invoice quickly, and then report out all those metrics.
And as we report, our model gets smarter and smarter
to better help distribute the allocation of the barges across
the demand.
Speaker 1 (06:17):
And so obviously you're in startup mode. I'm assuming are
you guys profitable yet?
Speaker 2 (06:22):
We're always focused on growing. I think we're in the
early stages of our growth as I mean, over the
last few last year or so, we've tripled in size
and we're investing in our product and our team and
we're going to continue to do so until we're a
public company. So right now you know the focus is growth.
(06:44):
It's not focused on profitability at the stage.
Speaker 1 (06:47):
Okay, so big goals go on public fantastic.
Speaker 2 (06:49):
I hope to have our own chick here in the
Bloomberg terminal.
Speaker 1 (06:52):
That would be great, and hopefully I'll be able to
cover you guys as an analyst. So can you educate
us on the industry. So you're talking barge tugs, people
listening might not know what one is versus the other.
Can you tell us, you know what the difference of
this between a barge and a tug.
Speaker 2 (07:09):
Definitely, So a tug is the horsepower actual vessel. It's
crewed and usually like four people and they're actually pushing barges.
Barges are essentially a floating container, a large floating container.
They're almost like a ship, but they're not self propelled,
so they are pushed by a bar, by a boat,
(07:32):
a tug boat, and they can push them in groups
of up to forty, which is ten acres of cargo
moving on the Mississippi River at a given time. That's
almost a just a fifteen barge toe is over a
thousand trucks worth of cargo being pushed by just four
people straight into the heartland of America. And you know,
(07:54):
you can do the same in Europe and South America.
South America you have long rivers stretching into the heartland.
And in Europe actually going to throw a curveball, the
barges are a self propelled they're almost like a ship,
an inland ship, and they operated a bit differently. Ultimately,
they're barges moving on the river. One of them is
(08:16):
self propelled, the other one is not. America, we have
the largest, widest, longest rivers, so we can move huge
amounts of cargo on a given boat. In Europe you
have thinner, narrower rivers that you're generally moving a self
propelled inland ship.
Speaker 1 (08:32):
Gotcha. That's and it's interesting because it's a very fragmented business.
Right at least, there's there aren't a lot of publicly
traded barge companies. I think Kirby might be the only one.
Speaker 2 (08:42):
Kirby, they are publicly traded, and yeah, they're really the
primary publicly traded barge line. A lot of them are
in Europe. They're owned by almost individuals, So in Europe
you'll have highly fragmented individuals, almost like a mom and
pop shop that are moving barges. And then in America
(09:04):
you tend to have larger corporations that will own those barges,
but you have a range of smaller operators to large.
Some of the largest private family businesses are barge businesses.
And one interesting thing is I think to call out
all of almost all of the largest companies in the
(09:25):
world that are not tech related are using barges. So Cargill,
for example, heavily dependent on barges. Coke industries also heavily
dependent on barges. All the oil majors like barges are
the tools of industry, and I think it's important to
take away because while not many people know them, they
(09:47):
are affecting every day of our lives. Right.
Speaker 1 (09:50):
And then you know, you mentioned like companies like cargo,
You know some of the oil integrators, which I guess
like Exono Mobile, do they do they own their own
fleet or are they completely sourcing this.
Speaker 2 (10:03):
So it's always there's a level of integration that some
companies will have. Most of the oil majors are they
charter in assets so the long term charter barges, and
they'll even they'll do spot barges. The grain companies and
a lot of those grain folks they will usually own
(10:25):
their own barges, but the other half of them will
charter barges in So it really depends on the individual company.
You can see all all across the board. You'll have
ones that own their own assets, charter in assets themselves,
or they just straight up charter and every so often
(10:46):
they'll only use their own barges, but rarely. And one
important thing to note is in the grain trade, barges
are actually traded as they go down river. So you'll
send a barge from let's say Saint Paul, Minnesota, and
it'll be on its way to New Orleans and it'll
be traded five or six different times and be owned
by a different company technically five or six times as
(11:09):
it goes to New Orleans to load as ship to
take grain products to Europe or wherever it may be going.
Speaker 1 (11:15):
Gotcha, I guess you know, I know you guys look
at other markets outside the United States, But you know,
is there is there a marketplace or are you the
marketplace where people go to to see what rates are?
Is that is that? You know? I guess give us
more examples of the services that are on the platform
(11:36):
outside of visibility, which obviously is extremely important, But you know,
I'm assuming you guys do more than that.
Speaker 2 (11:42):
Definitely. I mean, we have an entire pricing engine that
enables customers to instantly understand the costs to move cargo
by barage on different river segments. That's a proprietary model
that we've been that we build. It can connect to
customers existing contracts or enable them to leverage other information
(12:07):
and ultimately estimate the costs of their transportation in different regions.
That's definitely a large part of our model. Even the
visibility side is only one module of our platform. The
first aspect is the demand side, ultimately enabling them to
understand how many barges they'll actually need to cover the
(12:28):
amount of cargo that they're looking to ship. So some
customers are just looking to ship individual individual parcels and
that's fairly straightforward. But others have refineries they need to
keep online, or huge contracts that they need to fulfill,
and we enable them to instantly understand this is how
many barges you'll need to move, this of what type,
(12:50):
and then help them understand how much is it going
to cost. There's almost no real public rating system the
barges in the US oil side, there's really no on
the liquid barge market, there's no place you just go
to get what the current rates are publicly. And the
(13:10):
on the grain side, there are public tariffs that are
posted by the US Department of Agriculture, although they only
reflect the tariff rate and not necessarily the demand, which
is a percentage applied to that tariff. Europe is slightly different.
There's some sources that publish rates, but not an American.
Speaker 1 (13:32):
Right in the US, this might be a dumb question.
Are there different sized barges Like you know, dry bulkers
have cape sized panamacs and and containers. There's different sized containers.
Speaker 2 (13:42):
There's there's a wide array of barges. When you look
across inland and ocean barging. On the ocean, you start
to see a lot a wider range of sizes that
are generally shipped, but on the inland side it's very
it's standardized. In the grain market, you're generally shipped a
box or rake. It's usually fifteen to sixteen hundred tons
(14:06):
of cargo per barge. And then on the inland side
you either have ten thousand barrel barges for liquid or
thirty thousand barrels. You may see fifteen to twenty thousand barrels,
but they're less common. Most of the time you're shipping
in ten thousand thirty thousand barrel barges, and on the
dry side you're primarily fourteen thousand tons or sixteen thousand tons.
(14:32):
An important thing to understand is when water levels dropped.
Of course, you can fit less tons or barrels in
a barge. So when you see periods of low water,
you start to see shippers having to pay a higher
rate because now they have to charter multiple barges to
cover the amount of cargo that they would generally ship
in one or two barges.
Speaker 1 (14:53):
Yeah, so we've seen low water levels in Europe and
you know parts of the Panama Canal and other places.
How has shippers and capacity providers' ability to mitigate the
risks from that. How are they able to do that
on the platform, on the opendope platform.
Speaker 2 (15:14):
Yeah, So we're pulling in water level data from all
the different government sources that are reporting it, and then
we're forecasting out models on how much the water level
will be and what that does to the amount of
cargo that the customer is shipping. It comes down to
helping the customer understand how many barges they'll need to
move the cargo and what costs. So we're giving them
(15:38):
alerts and we're and telling them, you know, based on
these water levels and where we're forecasted to be, this
is how many barges you may need in order to
cover this, and this is what it does to your costs.
So a big aspect of our platform is pulling in
data sources from as many places as we can find, government,
(15:59):
other vests, data, condition data, and helping drive decisions on
how to run an effective just in time barge supply chain,
both for the carriers and for the shippers.
Speaker 1 (16:10):
And then I guess in each of the markets that
you that you're in, you know, the US, Europe, wherever, where,
what are the kind of biggest inefficiencies of those markets,
and how are you solving those?
Speaker 2 (16:23):
Definitely, one of the largest inefficiencies is due to lack
of information flow between the correct parties. A lot of
times you'll have back caling barges that move cargo one
way loaded and they go back empty, and there's no
orchestration or very little orchestration across the trade flows of
(16:48):
cargo where barges are just moving back one way empty
simply for a large reason, not enough people know about
the opportunity. And I think that is one of the
big things we're trying to help highlight is there's a
large fleet of barges that loaded one way and go
back empty the other direction, and enabling shippers understand, hey,
(17:11):
there's a great opportunity to move cargo at a lower
cost on effectively empty legs helping bring that to the
right people. And then on the other side, there is
a lot of like I mentioned, people involved in a
given barge trade. A lot of times a terminal will
have a barge show up that didn't even know was
(17:34):
supposed to come to its terminal, which means that they
now have to wait for a couple of days potentially
to be unloaded and brought back into the system the
idle time. So a couple of things we're helping orchestraate
across barges in a given fleet. We're trying to eradicate
those empty repositions, So when the barge is moving empty
(17:57):
one way, we're helping try to connect that togo that
needs to move in that direction. The other side, on
the visibility portion, to cut down on the amount of
days that we're sitting idle, we're helping give terminals and
the parties who need to know when a barge is
showing up real time visibility as to when that barge
will arrive. Those are the areas that we're really focusing
(18:20):
on cutting back on the inefficiencies. But beyond that, we
have a lot of lock and dam infrastructure throughout the
US throughout Europe, and that's aging infrastructure, which causes massive
delays when those become choke points. So a big part
of the barge industry and advocacy is going to Congress
(18:41):
helping them direct funds to keep the rivers open as
much as possible where you have locks that have long delays,
and helping make sure that that infrastructure is supported correctly.
Speaker 1 (18:55):
It pays for that infrastructure too. I'm like, you know,
obviously in the US we have tolls and gas taxes
that supposedly pay for the highways. Rails are self funding
for the most part. Who pays for How are the
waterways and inland waterways funded?
Speaker 2 (19:15):
Yeah, they're funded usually through taxes on fuel consumption through
basically burning fuel on on river segments. There's a department
US Army Corps of Engineers which gets funding, and the
Army Corps of Engineers maintains all the locks and dam
infrastructure and dredging in the rivers.
Speaker 1 (19:36):
Gotcha. And from a capacity standpoint, you know, there are
certain subsegments of the freight transportation markets like trucking or
the container liner market that you know, way too much capacity.
Is there too much capacity in the arch market.
Speaker 2 (19:54):
At the time? No barges actually are, I would say,
are in a pretty decent position in terms of supply
and demand. Steel prices have gone up big time, creating
it more expensive to build new barges, so there haven't
been many new barges built, but demand seems to be strong,
(20:15):
and I suspect that there will be a lot more
barges being built in the next few years. So rates
rates are generally have been generally high in the barge
market as to where they normally are, and I suspect
it may cool down a little bit. And I think
people are going to start investing in building more barges,
(20:37):
especially as more infrastructure projects are coming online. Energy is
becoming more and more important than ever before, and I
think that will continue to drive a really strong demand
for barge services. I'm optimistic.
Speaker 1 (20:51):
And you know, it sounds like there's room for the
industry to be more productive, to make more money, and
I guess open took can help with that. But is
there are they do they grow more than just GDP
that the barge industry or is you know, they're obviously
(21:13):
not getting shared from trucking because if you're moving something
from LA to Chicago, it's not going to be a barge.
Speaker 2 (21:18):
You need the water.
Speaker 1 (21:20):
Is the share that they have relative to other modes
kind of set or are there more opportunities do you
think for the barge industry? And I guess where are
those opportunities?
Speaker 2 (21:31):
Yeah, I think there's quite a few opportunities for the
barge industry. One of the areas that it's going to
take some time to mature is moving containerized cargo on
barges in America. So barges are traditionally almost entirely moving
bulk cargo, but there's major There's major investment going on
(21:53):
in New Orleans right now, which is a very important port,
a port that's so important that General Andrew Jackson march
two thousand men rough from the Northeast down to defend
it against the British and it really did set America
on a great trajectory. They're investing in a new I
think it's like eighty million dollar container terminal at the
(22:15):
mouth of the Mississippi River, which keep in mind goes
directly from to Chicago to Saint Paul, Minnesota, to Kansas
City to Pittsburgh. All of those places are accessible by
the river. And that investment in those new containers flowing
into the market, I think we could start to see
potentially those containers moving on barges, so there's more opportunity
(22:38):
in that cargo area. I would also say in South America,
you're starting to see more growth in just using barges
as there's more farms, it becomes a larger agrig culture
producing country. I think inherently barges are the cheapest way
to move that large amount of bulk cargo. So I
(22:59):
think South America will heat up a lot, and then
all the new projects in infrastructure that is being built
around the US that requires barges, and I think that
there's more cargo that is coming available.
Speaker 1 (23:16):
Yeah, And I'm just curious from like, how long does
it take a typical barge to go from Chicago to
New Orleans and the New Orleans to Chicago, because they're
going to be competitive with the rails. I mean there's
you know, some some shippers don't really care, I guess
you know how long something takes, but others do.
Speaker 2 (23:33):
So I was going to say, yeah, so in terms
of the types of cargo that are going to be
moving on barges, you generally have to be less time
and sensitive. You can see up to an eighty percent
cost reduction moving this cargo by by barge. So when
you're talking like bulk products and other products that are
(23:54):
dry goods that don't need to be there right away,
then becomes extremely costs competitive. And then when you're looking
you know you're going to continue to move more perishable
goods that need to show up just in time on
on truck amongst others.
Speaker 1 (24:14):
Gotcha.
Speaker 2 (24:14):
And then in terms of a transit time like going
up river, obviously you're you're looking at a longer transit time.
So going up going down river from New Orleans Chicago
to New Orleans, like you're roughly looking at like a
ten day transit going upriver, you could be looking at
more like fifteen fifteen days. And open tug provides all
(24:37):
that information like across all the different ports that uses
need to ship. Just basically how long should you be
expecting it to take?
Speaker 1 (24:47):
And when you when you top to barge operators because
I'm assuming you just spend a lot of time with
the capacity providers, do they because you know there's a
big merger between two railroads and you know people are
concerned that could lead to further consolidation. Obviously, rails do
compete with barge. You know, when it's geographically feasible. Are
(25:11):
they talking about that or it's not really on the radar.
Speaker 2 (25:14):
I think they are talking about it a bit. The
barge industry generally they do transload to rail, so they
play nice with the railroads. It hasn't been a large
topic amongst many of the barge carriers that we work with.
But I think it is something that people are paying
(25:35):
attention to, although it's mostly an east and like at
east to west trade, so this particular merger is not
I would say I have a major concern for the
barge carriers more north to south trades is where things
start to get more competitive. Got it? Okay?
Speaker 1 (25:55):
And you know you talked earlier about obtug and A
and you know if you talk a lot about AI,
you'll get a couple of turns on your valuation. Can
you talk about, you know, how you're leveraging AI? Are
you doing it?
Speaker 2 (26:12):
No?
Speaker 1 (26:12):
Are you guys able to do it internally? Or or
you are you kind of leveraging other platforms that you're
putting into your platform If that makes any sense. I'm
not a tech person.
Speaker 2 (26:21):
So happy happy to answer about it. So I mean, effectively,
we're using AI to aggregate all the different sources of
data because there's no basically central sources on where barges
are and what they're doing. So we have AI that
reads through all of the emails and communication that's happening
(26:43):
back and forth between shipper charter, the updates that the
carriers are sending and we're creating a common operating picture
without any manual entry. So effectively, you can't just track
all the barges like you can to ship. They're just there.
That data isn't available, So we aggregate data using AI
(27:04):
across all the different communication channels that that information is
being relayed to create a common operating picture. And then
we're training algorithms to analyze the transit times across a
specific vessel, a specific trade lane to help people understand
as whether and water levels change, what is that going
(27:25):
to do to you know, how long it's going to
take and when will your barge specifically show up. So
a lot of the AI is centered around aggregating data
and reading it from emails, PDFs and bringing that into
the platform to drive the visions, along with predicting transit times,
the optimal combination of tugs and barges and what the
(27:49):
costs is expected to be, and then.
Speaker 1 (27:52):
Just chifting gears a little bit.
Speaker 2 (27:54):
You know.
Speaker 1 (27:54):
The more protectionist policies out of Washington has that had
a major packed on the barge industry.
Speaker 2 (28:01):
Yeah, I would say it has affected more of the
grain and dry cargo markets more than anything. I think
it hasn't made it necessarily a negative impact on it.
More so, it has created a lot more uncertainty around
like who's going to be trading this year, And I
(28:22):
think that there's quite a bit of trade going along
with other countries when you're exporting products. We work a
lot in the oil and gas sector, which is we
have a huge demand for oil and gas, like all
of our cars other products in the US, and a
lot of that is being mixed and blended amongst US
refineries and that's where a lot of our businesses and
(28:44):
that hasn't necessarily been affected very much. I would say,
got you.
Speaker 1 (28:48):
And you know, just staying on the protectionist trend, you know,
the Trump administration also talked about, you know, imposing fees
on like Chinese made chips that come to US, or
are the tugs and barges are they made? Are they
USA made? Or are they made in China?
Speaker 2 (29:07):
So we know they're not at all. And we have
something called the Jones Act in America which means every
vessel that is moving cargo between US ports must have
an American made vessel, an American crewed asset, like people
on that vessel, So you know, taxing those Chinese ships
(29:31):
really only affects if you're transloading or taking that cargo
further inland, like if you see less of them, if
there's less product being imported, you know, you'll see that
maybe trickle into the bargestry a bit. But barging most
of the time we're exporting grain products, exporting oil products,
(29:52):
or moving that amongst the country itself. And I would
say barges do well. Like in obviously COVID hit the
barge industry pretty pretty strong, but even in the trade uncertainty,
the barge market has been strong.
Speaker 1 (30:08):
And then just just to clarify, so I get like
the tugs have to be made in the US for
Jones Act, the barges also have to be made.
Speaker 2 (30:15):
Yeah, they do.
Speaker 1 (30:16):
That's interesting. Are there just like one or two manufacturers
of barges in the United States?
Speaker 2 (30:24):
There's not a ton there. Yeah, there's definitely not that
many people building barges right now. There's some shipyards that
are building them, some independent businesses that are owned by
barge lines are actually building they're building barges, So yeah,
I think it's something that we hope to see more people.
I know there's some startups working on like rapidly manufacturing
(30:47):
barges and vessels in the US, which I think is exciting.
And you mentioned you're you're in the US, in Europe,
South America. Are you guys in Asia as well? I
don't know if you mentioned the Asia. That's on the
horizons for US immediately, as South America and Europe are
(31:08):
the immediate areas of focus. America primary is where we started.
Speaker 1 (31:13):
And in terms of market size, is Europe the largest
barge market?
Speaker 2 (31:19):
I would it's They're pretty They're pretty close US and
and and Europe. It's like take one hundred billion dollar
market globally roughly, and I would say about forty billion
of that is in the US. But that's the size
of revenue, you know, paid to barge companies, so they
(31:42):
play a large role across this cargo.
Speaker 1 (31:45):
And so do you get to ride on any tugboats
or barges.
Speaker 2 (31:48):
I do ride on barges and tugs. I actually started
out working on on some boats. I worked in the office,
but I would go on boats. I'm actually taking a
two day ride down from Baton Rouge to New Orleans,
UH in the coming in the coming months. One of
our customers was nice enough to offer to take me
down a riverboat ride and it's not like a great
(32:11):
it's not like a cruise, but we'll learn a lot.
So there's no casino, no buffet, casino, buffet on board
unfortunately one prior on those assets.
Speaker 1 (32:22):
Yeah, oh, that that sounds like it'll be be a
fun trip.
Speaker 2 (32:26):
They have great chefs a board.
Speaker 1 (32:28):
Okay, and so you know, let's let's change gears a
little bit and and kind of talk about you know,
you as as a co founder and an entrepreneur. You know,
if you can talk about kind of the biggest lessons
learned as an entrepreneur, so for those budding entrepreneurs they
might be able to avoid.
Speaker 2 (32:48):
I think the biggest lesson that I've learned as an
entrepreneur is that, like an idea is is really is
not the most important aspect of your business. And everybody
has good ideas, but it always comes down to execution.
And I think spending about like ten percent of your
(33:10):
time on ideas and strategy and ninety percent of the
time on actually executing, because you'll ultimately never know if
your idea is good or if your strategy is good
until you've actually executed for some time. And it can
be easy to sit and get analysis paralysis, focusing on
how do I what is the best strategy to enter
(33:32):
this market? What is the best product to build, you know,
for these given users? And I think you really can't
know until you just get started and be prepared to
hear no million times. But ultimately, the thing that's going
to make you be successful is how hard you're executing
and your ability to pivot and be resilient from what
(33:56):
you learn. That's been in my experience like the key
to success, because I would say the idea I first
started this business with was a bad idea, but because
we executed against it so relentlessly and ultimately learned through
just existing in the marketplace, we were able to come
(34:16):
to a good idea. And I think that anybody can
be a great entrepreneur if they do what it takes
to just put in the effort, the long hours and
just going to where your customers are.
Speaker 1 (34:30):
And you know, you mentioned you started this business with
two of your very good friends. Has starting a business
with friends tested the friendship?
Speaker 2 (34:40):
Honestly, not too much. We've we've we've had our time
is where we argue, but it's only constructive and I
think you just can't be afraid of conflict with these
people that you started with, Like if you are if
you would go into it expecting that you as will
have conflicts and you just leave it at that, then
(35:03):
it doesn't harm the friendship at all, as long as
you just understand what you're getting into and you.
Speaker 1 (35:09):
Know, I guess, are there anything else facing the freight
transportation markets that are on your radar? And maybe you
know where there are other markets that you feel that
the open tug idea could be applicable to.
Speaker 2 (35:22):
I mean, like I mentioned, our goal is to be
the global barge platform, and my goal is to help
the barge industry get bigger and bigger. So we're staying
true to barges, although we will support like all maritime assets,
so ships as well. But our goal is to help
grow the barge industry by lowering the barrier it takes
(35:43):
for shippers and others to start leveraging the mode, because
there's a lot of people who just don't even know
what a barge is or what it can do for them.
And like, we want to bring barges to the masses,
and until we've done that, we won't go to other
modes besides ships. Potentially, And then I.
Speaker 1 (36:01):
Guess, you know, how did you know you mentioned that,
you know, you started your career in the maritime kind
of industry. How did you gravitate there before starting OPENTUK.
Speaker 2 (36:13):
Yeah, so I was building technology. I was actually I
first started a platform called the market Map, and I
wanted to build technology for financial services to help forecasts
and bring data together to to help trade stocks, a
lot like a Bloomberg terminal. But I learned that there
was people who had done it better and already done
(36:35):
it before. So I kept searching and I was actually
my college girlfriend. Their family was in the maritime industry,
and I got to start working at a really well
done maritime company and I just through my exposure there,
I fell in love with the barge industry as a whole.
Speaker 1 (36:56):
And then I guess, you know, I always like to
ask our guests these kind of quotquestions about books that
they've read, and you know, whether it's about you know,
business entrepreneurship or the industry, you know, the maritime industry
or barge industry. Is there a book that's kind of
close to your heart that you've read in the past
that you know you would recommend to people that are
(37:17):
either looking to become entrepreneurs or better entrepreneurs, or people
are looking to learn more about the barge industry.
Speaker 2 (37:23):
Yeah. So I think there's not many books about the
barge industry that themselves that I have particularly read. But
as far as books for becoming an entrepreneur and just
building a business, amp It Up by Frank Slutman, I
think was one of the most impactful books I've ever read.
(37:44):
And you know that coming from Frame Slupman. He's created
hundreds of billions of dollars in market across the public
companies and he'd iPod all of them, and he's tough
as nails and it gets a lot of the heart
you need to hear early on. I think The Art
of the Deal is a pretty good book that I
(38:06):
think should be for read at some point to learn
about making deals. And anybody who wants to learn about
logistics should read The Box, which is the origins of
the container, because I think it really opens your eyes
to how an industry can be the same way. For
thousands of years, they were moving cargo only in bulk,
(38:29):
and then somebody invents the box and that really revolutionizes logistics.
But it actually took over twenty years, and it took
the Vietnam War to actually start bringing this great idea
into fruition. So I think it does show how you know,
there's just because it's been done the same way for
(38:51):
the dawn of time, and just because you have an
idea and it doesn't catch on right away doesn't mean
it's a bad idea. And all of those, I would say,
are good boots that have been impactful to me.
Speaker 1 (39:04):
All right, great, well, we're coming up at the end
of our time. Jason. I really want to thank you
for your insights today.
Speaker 2 (39:11):
Thank you. I've had a great time and I hope
to see you in Prinson one day and.
Speaker 1 (39:15):
Yeah, that'd be great, and you know, good luck with
you know, building opentalk further. I also want to thank
you for tuning in. If you liked the episode, please
subscribe and leave a review. We've lined up a number
of great guests for the podcast, so please check back
to here conversations with C suite executives, shippers, regulators, and
decision makers within the freight markets. Also, if you want
(39:37):
to learn more about the freight transportation markets, check out
our work on the Bloomberg Terminal at Bigo and on
social media. This is Lee Glasgal signing off. Thanks for
talking transports with me. Talk to you next week.
Hi everyone, this is Lee Clasgow and we're Talking Transports.
Welcome to Bloomberg Intelligence Talking Transports podcast. I'm your host,
Lee Klasgow, Senior Freight, transportation and logistics analysts at Bloomberg Intelligence,
Bloomberg's in house research arm of almost five hundred analysts
and strategists around the world. A quick public service announcement
before we dive in. Your support is instrumental to keep
(00:30):
bringing great guests and conversations to you, our listeners, and
we need your support. So please, if you enjoy this podcast,
share it, like it and leave a comment. Also, if
you've got ideas, feedback, or just want to talk transports,
I'm always happy to connect. You can find me on
the Bloomberg terminal, on LinkedIn, or on Twitter at Logistics Lead.
(00:50):
I'm very excited to have Jason Aristides, the CEO and
co founder of opentug. Aristides leverage is extensive background, spending
five years in software development and roll at companies like
Foss and Curtin Maritime to launch opentug in twenty nineteen.
His mission is to introduce advanced technologies that optimizes marine logistics,
(01:11):
boost industry competitiveness, and elevates services for shippers globally. Welcome
to talking transports, Jason.
Speaker 2 (01:20):
Thank you very much. Lee really excited to be here.
Speaker 1 (01:23):
Yeah, and you know we're excited to have you. We
actually haven't done much on the barge or tug industry
or inland waterways. You know, if you if you can't,
just before we dive into that, can you just talk about,
you know about opent tug.
Speaker 2 (01:37):
Definitely happy to talk about open tugt opent tug has
been my mission, my passion since I entered my working career,
and I think to understand open tugt It's great to
talk about just the tug and barge industry in general
because it really drives why I'm building this business, and ultimately,
(01:58):
the tug and barge industry has been and leverage since
the time of building pyramids. The pyramids were actually built
using barges floating rocks down the Nile River, and it
has been core to transportation since the dawn of time.
But it's also a mode of transportation that few people
(02:18):
really focus on or understand how to leverage. And it's
also one of America's greatest competitive advantages. We have twenty
five thousand miles of coastline and inland waterways that can
serve over fifty percent of the US population at a
costs that's almost it's a fraction of what it costs
to move cargo over the road, and even half as
(02:41):
much as moving cargo by rail. So when I saw
this mode of transportation that's so highly efficient yet is
away from the public eye, I realized there was a
great opportunity to help this industry by providing best in
class technology that helps more shippers stock to use barges
(03:01):
and help some barge companies optimize their operations so they
can provide best in class service. And I started the
company after working in the tug and barge industry and
have evolved over time, starting with my two great friends
and co founders, and over the last year we've tripled
in size and are working with some of the greatest
(03:24):
shippers and carriers in the game.
Speaker 1 (03:27):
And so are you are you self funded? Are do
you guys like venture capitalist private equity? Can you talk
a little bit about your investors?
Speaker 2 (03:36):
Yeah, we're a venture backed company. We work with some
tremendous software investors along with great maritime investors. My former
employer at FOSS was also one of the people who
helped get us off the ground. And then we started
working with a wonderful venture fund called Entrada who's helped
(03:57):
launch some massive public companies along with TMV, which is
a maritime venture fund, and they have a great deal
of knowledge family who owns that owns a shipping line.
And we've been able to blend the best software investors
with the best maritime investors to create a board and
(04:19):
a group of investors that can help us build the
best technology for the right people.
Speaker 1 (04:25):
See can you talk about like you know, so what
does opentug do. Are you a platform for shippers or
a platform for capacity providers or both?
Speaker 2 (04:34):
We're a platform for the ecosystem, and the barge industry
is truly an ecosystem. On every barge transaction, you have
the charters who are actually chartering the barge. You have
the carriers, the fleets, the terminals, and one of the
big inefficiencies in the barge industry is a lack of
predictability and visibility. You know, we're subject to mother nature,
(04:55):
rivers are always changing, and barges are untracked. So and
TUG deploys tracking devices across all these barges, and we
provide an end to end software and GPS service that
helps our customers, whether you're a carrier shipper, optimize your
demand planning. So we use AI to capture all the
(05:17):
orders that people need to move, and then we help
automatically identify, based on our own proprietary model, which barges
in your fleet or across your group of assets, our
best and lowest costs to serve these loads. We then
track the barges, and we're one of the only companies
who are actually tracking real barges across the system. Ships
(05:40):
have AIS, barges do not, which means you can only
track the tug pulling it. Then we predict ETA's share
the ETAs with the people who need to know. We
then estimate the costs of how much it took to
actually move all of the equipment, compare it to the invoices,
help the carrier generate the invoice quickly, help the shipper
(06:04):
validate their invoice quickly, and then report out all those metrics.
And as we report, our model gets smarter and smarter
to better help distribute the allocation of the barges across
the demand.
Speaker 1 (06:17):
And so obviously you're in startup mode. I'm assuming are
you guys profitable yet?
Speaker 2 (06:22):
We're always focused on growing. I think we're in the
early stages of our growth as I mean, over the
last few last year or so, we've tripled in size
and we're investing in our product and our team and
we're going to continue to do so until we're a
public company. So right now you know the focus is growth.
(06:44):
It's not focused on profitability at the stage.
Speaker 1 (06:47):
Okay, so big goals go on public fantastic.
Speaker 2 (06:49):
I hope to have our own chick here in the
Bloomberg terminal.
Speaker 1 (06:52):
That would be great, and hopefully I'll be able to
cover you guys as an analyst. So can you educate
us on the industry. So you're talking barge tugs, people
listening might not know what one is versus the other.
Can you tell us, you know what the difference of
this between a barge and a tug.
Speaker 2 (07:09):
Definitely, So a tug is the horsepower actual vessel. It's
crewed and usually like four people and they're actually pushing barges.
Barges are essentially a floating container, a large floating container.
They're almost like a ship, but they're not self propelled,
so they are pushed by a bar, by a boat,
(07:32):
a tug boat, and they can push them in groups
of up to forty, which is ten acres of cargo
moving on the Mississippi River at a given time. That's
almost a just a fifteen barge toe is over a
thousand trucks worth of cargo being pushed by just four
people straight into the heartland of America. And you know,
(07:54):
you can do the same in Europe and South America.
South America you have long rivers stretching into the heartland.
And in Europe actually going to throw a curveball, the
barges are a self propelled they're almost like a ship,
an inland ship, and they operated a bit differently. Ultimately,
they're barges moving on the river. One of them is
(08:16):
self propelled, the other one is not. America, we have
the largest, widest, longest rivers, so we can move huge
amounts of cargo on a given boat. In Europe you
have thinner, narrower rivers that you're generally moving a self
propelled inland ship.
Speaker 1 (08:32):
Gotcha. That's and it's interesting because it's a very fragmented business.
Right at least, there's there aren't a lot of publicly
traded barge companies. I think Kirby might be the only one.
Speaker 2 (08:42):
Kirby, they are publicly traded, and yeah, they're really the
primary publicly traded barge line. A lot of them are
in Europe. They're owned by almost individuals, So in Europe
you'll have highly fragmented individuals, almost like a mom and
pop shop that are moving barges. And then in America
(09:04):
you tend to have larger corporations that will own those barges,
but you have a range of smaller operators to large.
Some of the largest private family businesses are barge businesses.
And one interesting thing is I think to call out
all of almost all of the largest companies in the
(09:25):
world that are not tech related are using barges. So Cargill,
for example, heavily dependent on barges. Coke industries also heavily
dependent on barges. All the oil majors like barges are
the tools of industry, and I think it's important to
take away because while not many people know them, they
(09:47):
are affecting every day of our lives. Right.
Speaker 1 (09:50):
And then you know, you mentioned like companies like cargo,
You know some of the oil integrators, which I guess
like Exono Mobile, do they do they own their own
fleet or are they completely sourcing this.
Speaker 2 (10:03):
So it's always there's a level of integration that some
companies will have. Most of the oil majors are they
charter in assets so the long term charter barges, and
they'll even they'll do spot barges. The grain companies and
a lot of those grain folks they will usually own
(10:25):
their own barges, but the other half of them will
charter barges in So it really depends on the individual company.
You can see all all across the board. You'll have
ones that own their own assets, charter in assets themselves,
or they just straight up charter and every so often
(10:46):
they'll only use their own barges, but rarely. And one
important thing to note is in the grain trade, barges
are actually traded as they go down river. So you'll
send a barge from let's say Saint Paul, Minnesota, and
it'll be on its way to New Orleans and it'll
be traded five or six different times and be owned
by a different company technically five or six times as
(11:09):
it goes to New Orleans to load as ship to
take grain products to Europe or wherever it may be going.
Speaker 1 (11:15):
Gotcha, I guess you know, I know you guys look
at other markets outside the United States, But you know,
is there is there a marketplace or are you the
marketplace where people go to to see what rates are?
Is that is that? You know? I guess give us
more examples of the services that are on the platform
(11:36):
outside of visibility, which obviously is extremely important, But you know,
I'm assuming you guys do more than that.
Speaker 2 (11:42):
Definitely. I mean, we have an entire pricing engine that
enables customers to instantly understand the costs to move cargo
by barage on different river segments. That's a proprietary model
that we've been that we build. It can connect to
customers existing contracts or enable them to leverage other information
(12:07):
and ultimately estimate the costs of their transportation in different regions.
That's definitely a large part of our model. Even the
visibility side is only one module of our platform. The
first aspect is the demand side, ultimately enabling them to
understand how many barges they'll actually need to cover the
(12:28):
amount of cargo that they're looking to ship. So some
customers are just looking to ship individual individual parcels and
that's fairly straightforward. But others have refineries they need to
keep online, or huge contracts that they need to fulfill,
and we enable them to instantly understand this is how
many barges you'll need to move, this of what type,
(12:50):
and then help them understand how much is it going
to cost. There's almost no real public rating system the
barges in the US oil side, there's really no on
the liquid barge market, there's no place you just go
to get what the current rates are publicly. And the
(13:10):
on the grain side, there are public tariffs that are
posted by the US Department of Agriculture, although they only
reflect the tariff rate and not necessarily the demand, which
is a percentage applied to that tariff. Europe is slightly different.
There's some sources that publish rates, but not an American.
Speaker 1 (13:32):
Right in the US, this might be a dumb question.
Are there different sized barges Like you know, dry bulkers
have cape sized panamacs and and containers. There's different sized containers.
Speaker 2 (13:42):
There's there's a wide array of barges. When you look
across inland and ocean barging. On the ocean, you start
to see a lot a wider range of sizes that
are generally shipped, but on the inland side it's very
it's standardized. In the grain market, you're generally shipped a
box or rake. It's usually fifteen to sixteen hundred tons
(14:06):
of cargo per barge. And then on the inland side
you either have ten thousand barrel barges for liquid or
thirty thousand barrels. You may see fifteen to twenty thousand barrels,
but they're less common. Most of the time you're shipping
in ten thousand thirty thousand barrel barges, and on the
dry side you're primarily fourteen thousand tons or sixteen thousand tons.
(14:32):
An important thing to understand is when water levels dropped.
Of course, you can fit less tons or barrels in
a barge. So when you see periods of low water,
you start to see shippers having to pay a higher
rate because now they have to charter multiple barges to
cover the amount of cargo that they would generally ship
in one or two barges.
Speaker 1 (14:53):
Yeah, so we've seen low water levels in Europe and
you know parts of the Panama Canal and other places.
How has shippers and capacity providers' ability to mitigate the
risks from that. How are they able to do that
on the platform, on the opendope platform.
Speaker 2 (15:14):
Yeah, So we're pulling in water level data from all
the different government sources that are reporting it, and then
we're forecasting out models on how much the water level
will be and what that does to the amount of
cargo that the customer is shipping. It comes down to
helping the customer understand how many barges they'll need to
move the cargo and what costs. So we're giving them
(15:38):
alerts and we're and telling them, you know, based on
these water levels and where we're forecasted to be, this
is how many barges you may need in order to
cover this, and this is what it does to your costs.
So a big aspect of our platform is pulling in
data sources from as many places as we can find, government,
(15:59):
other vests, data, condition data, and helping drive decisions on
how to run an effective just in time barge supply chain,
both for the carriers and for the shippers.
Speaker 1 (16:10):
And then I guess in each of the markets that
you that you're in, you know, the US, Europe, wherever, where,
what are the kind of biggest inefficiencies of those markets,
and how are you solving those?
Speaker 2 (16:23):
Definitely, one of the largest inefficiencies is due to lack
of information flow between the correct parties. A lot of
times you'll have back caling barges that move cargo one
way loaded and they go back empty, and there's no
orchestration or very little orchestration across the trade flows of
(16:48):
cargo where barges are just moving back one way empty
simply for a large reason, not enough people know about
the opportunity. And I think that is one of the
big things we're trying to help highlight is there's a
large fleet of barges that loaded one way and go
back empty the other direction, and enabling shippers understand, hey,
(17:11):
there's a great opportunity to move cargo at a lower
cost on effectively empty legs helping bring that to the
right people. And then on the other side, there is
a lot of like I mentioned, people involved in a
given barge trade. A lot of times a terminal will
have a barge show up that didn't even know was
(17:34):
supposed to come to its terminal, which means that they
now have to wait for a couple of days potentially
to be unloaded and brought back into the system the
idle time. So a couple of things we're helping orchestraate
across barges in a given fleet. We're trying to eradicate
those empty repositions, So when the barge is moving empty
(17:57):
one way, we're helping try to connect that togo that
needs to move in that direction. The other side, on
the visibility portion, to cut down on the amount of
days that we're sitting idle, we're helping give terminals and
the parties who need to know when a barge is
showing up real time visibility as to when that barge
will arrive. Those are the areas that we're really focusing
(18:20):
on cutting back on the inefficiencies. But beyond that, we
have a lot of lock and dam infrastructure throughout the
US throughout Europe, and that's aging infrastructure, which causes massive
delays when those become choke points. So a big part
of the barge industry and advocacy is going to Congress
(18:41):
helping them direct funds to keep the rivers open as
much as possible where you have locks that have long delays,
and helping make sure that that infrastructure is supported correctly.
Speaker 1 (18:55):
It pays for that infrastructure too. I'm like, you know,
obviously in the US we have tolls and gas taxes
that supposedly pay for the highways. Rails are self funding
for the most part. Who pays for How are the
waterways and inland waterways funded?
Speaker 2 (19:15):
Yeah, they're funded usually through taxes on fuel consumption through
basically burning fuel on on river segments. There's a department
US Army Corps of Engineers which gets funding, and the
Army Corps of Engineers maintains all the locks and dam
infrastructure and dredging in the rivers.
Speaker 1 (19:36):
Gotcha. And from a capacity standpoint, you know, there are
certain subsegments of the freight transportation markets like trucking or
the container liner market that you know, way too much capacity.
Is there too much capacity in the arch market.
Speaker 2 (19:54):
At the time? No barges actually are, I would say,
are in a pretty decent position in terms of supply
and demand. Steel prices have gone up big time, creating
it more expensive to build new barges, so there haven't
been many new barges built, but demand seems to be strong,
(20:15):
and I suspect that there will be a lot more
barges being built in the next few years. So rates
rates are generally have been generally high in the barge
market as to where they normally are, and I suspect
it may cool down a little bit. And I think
people are going to start investing in building more barges,
(20:37):
especially as more infrastructure projects are coming online. Energy is
becoming more and more important than ever before, and I
think that will continue to drive a really strong demand
for barge services. I'm optimistic.
Speaker 1 (20:51):
And you know, it sounds like there's room for the
industry to be more productive, to make more money, and
I guess open took can help with that. But is
there are they do they grow more than just GDP
that the barge industry or is you know, they're obviously
(21:13):
not getting shared from trucking because if you're moving something
from LA to Chicago, it's not going to be a barge.
Speaker 2 (21:18):
You need the water.
Speaker 1 (21:20):
Is the share that they have relative to other modes
kind of set or are there more opportunities do you
think for the barge industry? And I guess where are
those opportunities?
Speaker 2 (21:31):
Yeah, I think there's quite a few opportunities for the
barge industry. One of the areas that it's going to
take some time to mature is moving containerized cargo on
barges in America. So barges are traditionally almost entirely moving
bulk cargo, but there's major There's major investment going on
(21:53):
in New Orleans right now, which is a very important port,
a port that's so important that General Andrew Jackson march
two thousand men rough from the Northeast down to defend
it against the British and it really did set America
on a great trajectory. They're investing in a new I
think it's like eighty million dollar container terminal at the
(22:15):
mouth of the Mississippi River, which keep in mind goes
directly from to Chicago to Saint Paul, Minnesota, to Kansas
City to Pittsburgh. All of those places are accessible by
the river. And that investment in those new containers flowing
into the market, I think we could start to see
potentially those containers moving on barges, so there's more opportunity
(22:38):
in that cargo area. I would also say in South America,
you're starting to see more growth in just using barges
as there's more farms, it becomes a larger agrig culture
producing country. I think inherently barges are the cheapest way
to move that large amount of bulk cargo. So I
(22:59):
think South America will heat up a lot, and then
all the new projects in infrastructure that is being built
around the US that requires barges, and I think that
there's more cargo that is coming available.
Speaker 1 (23:16):
Yeah, And I'm just curious from like, how long does
it take a typical barge to go from Chicago to
New Orleans and the New Orleans to Chicago, because they're
going to be competitive with the rails. I mean there's
you know, some some shippers don't really care, I guess
you know how long something takes, but others do.
Speaker 2 (23:33):
So I was going to say, yeah, so in terms
of the types of cargo that are going to be
moving on barges, you generally have to be less time
and sensitive. You can see up to an eighty percent
cost reduction moving this cargo by by barge. So when
you're talking like bulk products and other products that are
(23:54):
dry goods that don't need to be there right away,
then becomes extremely costs competitive. And then when you're looking
you know you're going to continue to move more perishable
goods that need to show up just in time on
on truck amongst others.
Speaker 1 (24:14):
Gotcha.
Speaker 2 (24:14):
And then in terms of a transit time like going
up river, obviously you're you're looking at a longer transit time.
So going up going down river from New Orleans Chicago
to New Orleans, like you're roughly looking at like a
ten day transit going upriver, you could be looking at
more like fifteen fifteen days. And open tug provides all
(24:37):
that information like across all the different ports that uses
need to ship. Just basically how long should you be
expecting it to take?
Speaker 1 (24:47):
And when you when you top to barge operators because
I'm assuming you just spend a lot of time with
the capacity providers, do they because you know there's a
big merger between two railroads and you know people are
concerned that could lead to further consolidation. Obviously, rails do
compete with barge. You know, when it's geographically feasible. Are
(25:11):
they talking about that or it's not really on the radar.
Speaker 2 (25:14):
I think they are talking about it a bit. The
barge industry generally they do transload to rail, so they
play nice with the railroads. It hasn't been a large
topic amongst many of the barge carriers that we work with.
But I think it is something that people are paying
(25:35):
attention to, although it's mostly an east and like at
east to west trade, so this particular merger is not
I would say I have a major concern for the
barge carriers more north to south trades is where things
start to get more competitive. Got it? Okay?
Speaker 1 (25:55):
And you know you talked earlier about obtug and A
and you know if you talk a lot about AI,
you'll get a couple of turns on your valuation. Can
you talk about, you know, how you're leveraging AI? Are
you doing it?
Speaker 2 (26:12):
No?
Speaker 1 (26:12):
Are you guys able to do it internally? Or or
you are you kind of leveraging other platforms that you're
putting into your platform If that makes any sense. I'm
not a tech person.
Speaker 2 (26:21):
So happy happy to answer about it. So I mean, effectively,
we're using AI to aggregate all the different sources of
data because there's no basically central sources on where barges
are and what they're doing. So we have AI that
reads through all of the emails and communication that's happening
(26:43):
back and forth between shipper charter, the updates that the
carriers are sending and we're creating a common operating picture
without any manual entry. So effectively, you can't just track
all the barges like you can to ship. They're just there.
That data isn't available, So we aggregate data using AI
(27:04):
across all the different communication channels that that information is
being relayed to create a common operating picture. And then
we're training algorithms to analyze the transit times across a
specific vessel, a specific trade lane to help people understand
as whether and water levels change, what is that going
(27:25):
to do to you know, how long it's going to
take and when will your barge specifically show up. So
a lot of the AI is centered around aggregating data
and reading it from emails, PDFs and bringing that into
the platform to drive the visions, along with predicting transit times,
the optimal combination of tugs and barges and what the
(27:49):
costs is expected to be, and then.
Speaker 1 (27:52):
Just chifting gears a little bit.
Speaker 2 (27:54):
You know.
Speaker 1 (27:54):
The more protectionist policies out of Washington has that had
a major packed on the barge industry.
Speaker 2 (28:01):
Yeah, I would say it has affected more of the
grain and dry cargo markets more than anything. I think
it hasn't made it necessarily a negative impact on it.
More so, it has created a lot more uncertainty around
like who's going to be trading this year, And I
(28:22):
think that there's quite a bit of trade going along
with other countries when you're exporting products. We work a
lot in the oil and gas sector, which is we
have a huge demand for oil and gas, like all
of our cars other products in the US, and a
lot of that is being mixed and blended amongst US
refineries and that's where a lot of our businesses and
(28:44):
that hasn't necessarily been affected very much. I would say,
got you.
Speaker 1 (28:48):
And you know, just staying on the protectionist trend, you know,
the Trump administration also talked about, you know, imposing fees
on like Chinese made chips that come to US, or
are the tugs and barges are they made? Are they
USA made? Or are they made in China?
Speaker 2 (29:07):
So we know they're not at all. And we have
something called the Jones Act in America which means every
vessel that is moving cargo between US ports must have
an American made vessel, an American crewed asset, like people
on that vessel, So you know, taxing those Chinese ships
(29:31):
really only affects if you're transloading or taking that cargo
further inland, like if you see less of them, if
there's less product being imported, you know, you'll see that
maybe trickle into the bargestry a bit. But barging most
of the time we're exporting grain products, exporting oil products,
(29:52):
or moving that amongst the country itself. And I would
say barges do well. Like in obviously COVID hit the
barge industry pretty pretty strong, but even in the trade uncertainty,
the barge market has been strong.
Speaker 1 (30:08):
And then just just to clarify, so I get like
the tugs have to be made in the US for
Jones Act, the barges also have to be made.
Speaker 2 (30:15):
Yeah, they do.
Speaker 1 (30:16):
That's interesting. Are there just like one or two manufacturers
of barges in the United States?
Speaker 2 (30:24):
There's not a ton there. Yeah, there's definitely not that
many people building barges right now. There's some shipyards that
are building them, some independent businesses that are owned by
barge lines are actually building they're building barges, So yeah,
I think it's something that we hope to see more people.
I know there's some startups working on like rapidly manufacturing
(30:47):
barges and vessels in the US, which I think is exciting.
And you mentioned you're you're in the US, in Europe,
South America. Are you guys in Asia as well? I
don't know if you mentioned the Asia. That's on the
horizons for US immediately, as South America and Europe are
(31:08):
the immediate areas of focus. America primary is where we started.
Speaker 1 (31:13):
And in terms of market size, is Europe the largest
barge market?
Speaker 2 (31:19):
I would it's They're pretty They're pretty close US and
and and Europe. It's like take one hundred billion dollar
market globally roughly, and I would say about forty billion
of that is in the US. But that's the size
of revenue, you know, paid to barge companies, so they
(31:42):
play a large role across this cargo.
Speaker 1 (31:45):
And so do you get to ride on any tugboats
or barges.
Speaker 2 (31:48):
I do ride on barges and tugs. I actually started
out working on on some boats. I worked in the office,
but I would go on boats. I'm actually taking a
two day ride down from Baton Rouge to New Orleans,
UH in the coming in the coming months. One of
our customers was nice enough to offer to take me
down a riverboat ride and it's not like a great
(32:11):
it's not like a cruise, but we'll learn a lot.
So there's no casino, no buffet, casino, buffet on board
unfortunately one prior on those assets.
Speaker 1 (32:22):
Yeah, oh, that that sounds like it'll be be a
fun trip.
Speaker 2 (32:26):
They have great chefs a board.
Speaker 1 (32:28):
Okay, and so you know, let's let's change gears a
little bit and and kind of talk about you know,
you as as a co founder and an entrepreneur. You know,
if you can talk about kind of the biggest lessons
learned as an entrepreneur, so for those budding entrepreneurs they
might be able to avoid.
Speaker 2 (32:48):
I think the biggest lesson that I've learned as an
entrepreneur is that, like an idea is is really is
not the most important aspect of your business. And everybody
has good ideas, but it always comes down to execution.
And I think spending about like ten percent of your
(33:10):
time on ideas and strategy and ninety percent of the
time on actually executing, because you'll ultimately never know if
your idea is good or if your strategy is good
until you've actually executed for some time. And it can
be easy to sit and get analysis paralysis, focusing on
how do I what is the best strategy to enter
(33:32):
this market? What is the best product to build, you know,
for these given users? And I think you really can't
know until you just get started and be prepared to
hear no million times. But ultimately, the thing that's going
to make you be successful is how hard you're executing
and your ability to pivot and be resilient from what
(33:56):
you learn. That's been in my experience like the key
to success, because I would say the idea I first
started this business with was a bad idea, but because
we executed against it so relentlessly and ultimately learned through
just existing in the marketplace, we were able to come
(34:16):
to a good idea. And I think that anybody can
be a great entrepreneur if they do what it takes
to just put in the effort, the long hours and
just going to where your customers are.
Speaker 1 (34:30):
And you know, you mentioned you started this business with
two of your very good friends. Has starting a business
with friends tested the friendship?
Speaker 2 (34:40):
Honestly, not too much. We've we've we've had our time
is where we argue, but it's only constructive and I
think you just can't be afraid of conflict with these
people that you started with, Like if you are if
you would go into it expecting that you as will
have conflicts and you just leave it at that, then
(35:03):
it doesn't harm the friendship at all, as long as
you just understand what you're getting into and you.
Speaker 1 (35:09):
Know, I guess, are there anything else facing the freight
transportation markets that are on your radar? And maybe you
know where there are other markets that you feel that
the open tug idea could be applicable to.
Speaker 2 (35:22):
I mean, like I mentioned, our goal is to be
the global barge platform, and my goal is to help
the barge industry get bigger and bigger. So we're staying
true to barges, although we will support like all maritime assets,
so ships as well. But our goal is to help
grow the barge industry by lowering the barrier it takes
(35:43):
for shippers and others to start leveraging the mode, because
there's a lot of people who just don't even know
what a barge is or what it can do for them.
And like, we want to bring barges to the masses,
and until we've done that, we won't go to other
modes besides ships. Potentially, And then I.
Speaker 1 (36:01):
Guess, you know, how did you know you mentioned that,
you know, you started your career in the maritime kind
of industry. How did you gravitate there before starting OPENTUK.
Speaker 2 (36:13):
Yeah, so I was building technology. I was actually I
first started a platform called the market Map, and I
wanted to build technology for financial services to help forecasts
and bring data together to to help trade stocks, a
lot like a Bloomberg terminal. But I learned that there
was people who had done it better and already done
(36:35):
it before. So I kept searching and I was actually
my college girlfriend. Their family was in the maritime industry,
and I got to start working at a really well
done maritime company and I just through my exposure there,
I fell in love with the barge industry as a whole.
Speaker 1 (36:56):
And then I guess, you know, I always like to
ask our guests these kind of quotquestions about books that
they've read, and you know, whether it's about you know,
business entrepreneurship or the industry, you know, the maritime industry
or barge industry. Is there a book that's kind of
close to your heart that you've read in the past
that you know you would recommend to people that are
(37:17):
either looking to become entrepreneurs or better entrepreneurs, or people
are looking to learn more about the barge industry.
Speaker 2 (37:23):
Yeah. So I think there's not many books about the
barge industry that themselves that I have particularly read. But
as far as books for becoming an entrepreneur and just
building a business, amp It Up by Frank Slutman, I
think was one of the most impactful books I've ever read.
(37:44):
And you know that coming from Frame Slupman. He's created
hundreds of billions of dollars in market across the public
companies and he'd iPod all of them, and he's tough
as nails and it gets a lot of the heart
you need to hear early on. I think The Art
of the Deal is a pretty good book that I
(38:06):
think should be for read at some point to learn
about making deals. And anybody who wants to learn about
logistics should read The Box, which is the origins of
the container, because I think it really opens your eyes
to how an industry can be the same way. For
thousands of years, they were moving cargo only in bulk,
(38:29):
and then somebody invents the box and that really revolutionizes logistics.
But it actually took over twenty years, and it took
the Vietnam War to actually start bringing this great idea
into fruition. So I think it does show how you know,
there's just because it's been done the same way for
(38:51):
the dawn of time, and just because you have an
idea and it doesn't catch on right away doesn't mean
it's a bad idea. And all of those, I would say,
are good boots that have been impactful to me.
Speaker 1 (39:04):
All right, great, well, we're coming up at the end
of our time. Jason. I really want to thank you
for your insights today.
Speaker 2 (39:11):
Thank you. I've had a great time and I hope
to see you in Prinson one day and.
Speaker 1 (39:15):
Yeah, that'd be great, and you know, good luck with
you know, building opentalk further. I also want to thank
you for tuning in. If you liked the episode, please
subscribe and leave a review. We've lined up a number
of great guests for the podcast, so please check back
to here conversations with C suite executives, shippers, regulators, and
decision makers within the freight markets. Also, if you want
(39:37):
to learn more about the freight transportation markets, check out
our work on the Bloomberg Terminal at Bigo and on
social media. This is Lee Glasgal signing off. Thanks for
talking transports with me. Talk to you next week.
Host
Lee Klaskow
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