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The start of the ICOs of three interesting projects in the sphere of logistics means that the interest of experienced teams in using the blockchain technology has increased to the level of project realisation.
In July the ICO market saw the appearance of three logistic projects that may be interesting for investors. Before that, the Danish logistics giant Maersk in collaboration with IBM expressed an intention to work in the blockchain sphere. However, since the trial launch of the project there has been no news from these companies. Nonetheless, in 6 months the strong expert teams united and created a number of projects, therefore, in July blockchain in logistics has stopped being just a declared necessity but rather became a reality.
We analysed three large projects that use blockchain in logistics, two of those are focused on auto transportations, and the other one is focused on full market coverage and using multimodal solutions. All of them started raising funds in the mid-July, it seems that they were cautious as to not to be late or give way to competitors.
We evaluated the projects in terms of the volume of already collected funds and tried to identify the reasons for either their success or lack of it.
Project of IMMLA, the first international multimodal logistic application using the blockchain, came around in 2016 but the ICO has only started in July 2017.
Conditions for Pre-ICO and ICO. IMMLA project’s pre-ICO has started on 15th July 2017 and will last until 30th July of the same year. In four days the project’s team managed to collect almost $140,000 from the planned $500,000. During the ICO that will take place from 15th September to 15th October, another $8.5 million is expected to be raised. The project promises a 43% bonus for those who invest early.
Nature of the project. As explained by the IMMLA project’s authors, multimodality is the most complex component in logistics as it implies not just transportation from point A to point B using one type of transport but rather transportation from warehouse A to port B, from port B to port C by sea, from port C to a customs warehouse D via automobile and so on and so forth until the cargo reaches its recipient.
The team that launches the platform rejected the idea to do everything on their own and rather created a consortium of several corporations that represent logistics, financial and IT markets and that agreed to make this idea a reality – Hellmann, Formag, SBSolution. As a result, the platform is created on the basis of outsourcing ERP-solution Logismart for transportation industry, which works for both the client and the contractor. Specialists from a leading technological university of Russia are responsible for blockchain in the project. Two large international logistics corporations with annual transportation volume of a couple TEUs are the partners and experts of the project.
Marketing. Before the start of the pre-ICO, the project did not advertise itself and only presented themselves to the community a week before the start. Nonetheless, the published proofs of the team and approved advisors on the level of acting board members of transnational corporations have helped the project to quickly gain trust. At the moment, the project is present on all popular among the investors networks, forums and messengers.
A2B Direct project from Ukraine, which specialises in automobile transportations, was the first one of the three services that announced their ICO.
Conditions for ICO. Project’s ICO started on 12th July and will last until 12th August. In the course of the ICO the team aims to attract from $500,000 to $3 million. By 18th July more than $18,000 from 42 investors has been raised.
Nature of the project. The project’s objective is to create a platform that will allow to quickly connect the contractor with the client, support 24/7 communication with the driver, solve issues with the documentation workflow and exclude forwarding services surcharge. By the time of ICO the project already had an interface, which allowed to carry out transportation on two post-Soviet countries – Ukraine and Belarus – and claimed that the transportations already account to more than 700,000 kilometres. In their WhitePaper the project extensively describes the logistics market, while there is a plan for the tokens used and raised in the course of the ICO to be geographically expanded to foreign markets, one of the most promising of them being the US market.
Marketing. The project is not very actively marketed. In order to promote its ICO the project’s team decided to focus on the community, similar to Forklog publishing, where in the course of a couple of months three articles dedicated to this platform have been released. The project also has a YouTube channel, where the video of project’s CEO in Russian language gathered around 2000 views. Social media pages of the project are also not very active and are not often updated.
The third project, Slogn, includes the qualities of the previous two: similarly to the first one, it decided to focus on automobile logistics and similarly to the second one it divided their ICO in 2 rounds (pre-ICO and ICO).
Timeline of Pre-ICO and ICO. Pre-ICO of the project was launched on 17th July and will be already finished on 19th July. In the first two days more than $20,000 have been raised considering the fact that the early bird discount for the first investors is 70%. Project’s ICO starts on 25th July and will last until 15th August.
Nature of the project. The market, which the third logistics ICO actor of this summer chose to focus on is the US market, where the company is planning to offer discount for fuel, parking slots and other similar things using the help of blockchain.
Marketing. The project has been announced less than 2 weeks prior to pre-ICO. During this time the project didn’t manage to hold a significant marketing activity, but it did create accounts in all important for ICO social media platforms and forums. It may be that the marketing of the project will be increased as the ICO approaches as the funds raised during the presale will be mostly directed on marketing.
Comparison of the functionality of different logistic platforms in blockchain, which hold ICOs
|Planning regions of presence||Worldwid||Ukraine, Belarus, Europe, USA||USA|
|Platform (or one of its part) start date||IQ 2018||2016||n/a|
Poor sales of two from the three projects is an indicator that the market still does not fully comprehend the opportunities implied in the use of blockchain in logistics and only trusts verified teams with proved working experience and global competencies. The philosophy of blockchain that is translated through investors demands that the projects’ teams work on global rather than local or regional levels.
It can be expected that in the future the interest in logistics on the base of blockchain will be maintained. Nevertheless, of course, the first projects always have a higher chance for success.