New York Ship Exchange (Nyshex), a platform that connects shippers with ocean carriers, today announced that it has raised $25 million in a Series B funding round led by Colate Capital, along with Bloomberg Capital, Goldman Sachs and Newrod Capital. The selection brings the company’s total to $69 million, and CEO Gordon Downes said Nichex’s services will be used to support all types of ocean cargo contracts.
Downes notes that the ocean shipping industry lacks the basic digital infrastructure found in other markets. For example, there are no standardized contracts, he said, and no network of financial services to hold deposits and settle payments.
“The industry has spent the last decade or so focused on surviving price wars and solving rapid consolidation,” Downes told TechCrunch in an email. “Nyshex was established because [we] They have experienced firsthand the challenges associated with monitoring contractual commitments. [we] He realized that the existing ones could not solve these challenges.
Downes founded Nyshex in 2014 after serving as director of supply chain giant Maersk and key account group. The idea, he said, was to create a “carrier-neutral” tool that would provide a single source of truth for contract completion and execution.
For this, Nyshex provides workflows to create contracts for shipments in place and equipment. The company acts as an independent third party, enforcing contracts between carriers and service providers and hosting dashboards that provide critical metrics to both carriers and shippers. If something goes wrong, Nishex works with shippers and carriers to reach a solution.
Nyshex can also match cargo holds and body movements. Using AI trained on ocean carrier data and data from third-party ship aggregators, the system can match shippers and freight forwarders with ocean carriers in real time, Downes says.
“The pandemic has highlighted the need for our products in the market and has fundamentally changed the way the industry moves forward,” he said. “C-suite decision makers understand the importance of a trusted system of record, and this is due to the increasing disruption of the supply chain. Freight contract execution, combined with workflows that improve performance – and reduce costs by creating efficiencies – improves supply chain resilience and creates a competitive advantage.”
Looking to stay ahead of rivals such as Freightos, Infor Nexus and BlueX, Nixex plans to launch a payments product with undisclosed “strategic financial services partners” in the coming months. Also looming large on the horizon is a new “shipping-focused” distribution management product that Downes says can support the more than 100,000 shippers that contract directly with ocean carriers.
In the meantime, the business is stable, with annual recurring revenue hitting $12 million this year and operations expected to become cash flow positive in Q3 2022, Downes said. Nishex handled $1 billion in total cargo volume for 330 carrier and shipping customers last year, and that volume is expected to reach $4 billion by the end of 2022.
“Unlike post-pandemic e-commerce, our growth is expected to continue because volatility is expected to continue; basically, our business is counter-cyclical to the recession. Supply chains have changed over time and new market opportunities have emerged as a result,” Donnes said. “Financially, our Series B may be our last funding round. But we plan to continue to grow to capture more white space to secure shipments with trust, data and workflows.”
Nishex has 120 employees and expects to grow to over 170 by the end of 2023.
