SeaIntel: Maritime Technology Investments Nearing USD 1 Bn
Technology investments in the maritime industry are getting close to USD 1 billion, according to data by Crunchbase, a database of technology investments.
Out of the 94 companies which were identified as being on the forefront of transforming container shipping through technology, 34 have received a total funding of USD 866 million over the period 2014-2018, until January 21, 2018, but with a peak in 2016 followed by a slightly lower level in 2017.
SeaIntel Maritime Analysis informed that the magnitude of the investments is highly diverse with a few companies attracting the bulk of the investment funds. In the peak of 2016, 4 companies accounted for 71% of the investment, while in 2017 Flexport collected 40% of the total investments.
Split into age brackets, almost half of the 94 companies were founded in 2012 or later and therefore are in the 0-5 years age category. Slightly more than half of the companies are more than 5 years old, with more than 20% being more than 20 years old. Looking at the young companies, SeaIntel saw that the number started declining following a peak in 2014.
According to SeaIntel CEO, Alan Murphy, there are two different reasons for the decline.
Either the number of new companies being launched in this industry is indeed declining, which seems to run contrary to the sense one gets from the activity in the market in 2017. Or, more likely, it is a reflection that no matter how good an idea a company launches, it simply takes time to get on the “radar screen” and penetrate the industry.
“If this second interpretation is correct, it implies that there could be an incubation time of some 3-4 years from start-up until these disrupters actually hit the main industry,” Murphy said.
Looking at the funding in 2017 split on the age of the companies receiving the funding, there are clear spikes for companies between 3 and 5 years old. The large spike from year 4 is due to Flexport being in this age bracket.
The data also appears to support the notion that the time to financially break into the industry is 3-5 years, consistent with the analysis of the age of the full set of 94 companies, SeaIntel concluded.