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TranscriptionSantosh Sankar  0:40  Hey ladies and gents Welcome Back to the Future Supply Chain podcast. I'm your host Santosh Sankar. And joining me today: our very own James Coombs, CEO/Fo founder of Vector AI. Welcome!James Coombes  0:53  Thanks Santosh. Great to be here. Santosh Sankar  0:54  Yeah, so you're joining us from across the pond, and I would say You're a portfolio company that we talk a lot about when it comes to the industry. Equally, our listeners might not all be aware of what you're building. So we'd love to just kick it off with a quick, you know, two-minute overview of what Vector AI is and what you do.James Coombes  1:20  Yeah, sure. We often talk about the elevator pitch, right? So maybe you guys have total buildings, but for me, an elevator pitch goes like three or four floors. So we are Vector AI. We are we're a paperwork copilot, we help to automate paperwork and logistics space. And by paperwork, we mean all sorts of things from bills of lading, invoices, packing lists, and so on. We do about 20 different documents. 200 different data points across 20 different docs and growing, growing over time. And in terms of the scale of what we do, on aggregate. Our customers process about $130 million dollars every year at the moment,  that's obviously growing. So it's a huge space and one that I think we can look obviously objectively or not objectively, I think we can make a big difference.Santosh Sankar  2:11  Tell us about the founding story behind Vector. Because you know, I remember first meeting you and Nisar back in 2017 on a trip to London in like this swanky or I guess I remembered as swanky it might not have actually been... coffee shop in Shoreditch. How did this even come to be?James Coombes  2:33  Yeah, so I don't know how swanky it was. I can't remember exactly the name of a hotel, but it was just a coffee shop. Every coffee shop in Shoreditch is pretty swanky I guess. We saw this massage. So I met my partner at an event called Entrepreneur First. And we met in Mid 2017 and we've been working together ever since. You and I met on some random Slack channel started by a guy called Sam Cropper. I believe his name was from In Motion. And I think you were on the chat as well. And it wasn't a very active chat. And I remember seeing your name and I remember you had basically said you are going to be in the UK at some point would love to meet interesting people. And I was like, yeah, you know, I think I'm interesting. I'll meet. So I dragged my partner along to this random meeting and just random coffee shop slash hotel review with a random dude. You. You put us in touch with a bunch of people literally from having just met. And I just remember being really impressed that you kind of go to those lengths to kind of work, work with us and help us out, given that you'd only just met us. And for us, that meant a lot and I obviously kept on, kept on going away and kept on. I kept the discussion up a review over weeks and months afterward.Santosh Sankar  4:24  You explored a lot of different ideas around the supply chain. What was that 'aha' moment where you realized we want to go be the co-pilot around paper and paper communication.James Coombes  4:38  I'm not sure if it was a moment specifically. I mean, my previous career work, I worked in a big bank. I worked in commodities and trade. A lot of my customers when I trade houses, they're doing a lot of trade finance. And so I was just very aware of all the kind of paperwork issues of around that business alone, I'd also set up had also set up a furniture company as well. At the same time, I was at some point in '08, ended up importing a lot of furniture from around the world into the US and Europe. And had so it was pretty, pretty aware of kind of all the moving parts around supply chain and freight forwarding as a result of that experience. So I felt like I had a pretty good overview of not just the kind of finance and the kind of trade and the trade finance world, but also just general operational aspects of the supply chain. And I think I've been able to combine those in a way that kind of gives us abasing an edge. And that that was how we kind of got onto this. And it was a problem and I think it's one of those spaces that is is a huge problem, but not that many people know about it, and that's exactly where I want to be as a company.Santosh Sankar  5:56  Mm hmm. I think the interesting thing our listeners might have picked up on is that the one thing you and the team at Vector hold to be true? Is that paper is a mainstay of the global supply chain? Explain that expand on that, because we obviously agree as investors that that's true.James Coombes  6:15  Yeah. Yeah. It's something we get, you know, occasional pushback on. Really what we're addressing is a standard problem run with supply chain and the very definition of a fragmented industry. I mean, you've got everything from mom and pop shops and kind of manufacturers around all around the world customs, houses, government agencies, banks, insurance companies, shippers, I mean, you've got so many different players in the space. And the idea that they're all going to be on one standard, it just doesn't ring true to me. I think given they all have their own systems, standardization is going to be very hard to come by, as much as it is kind of the holy grail but kind of like the target the end. The end goal, I think, given the constraints of the moment, and the constraints of the moment rely on the kind of lowest common denominator. And that common denominator is often just paperwork, right? It's just communication, whereas the method of communication between all these different players, and it's the only kind of standard they have, and we think that's gonna, that's gonna persist. And really, I mean, I could go on for a long time about this, but we're a company we solve problems. And the problem, real problems today, I'm basically saying like, okay, we accept that this is the status quo. How do we help companies do a bit better? And that's, that's really a core belief. In many ways, you can think of us as being like, the universal adapter. We're agnostic, we don't care what comes in, we deal with it. And we help enterprises around the world have taken that nonstructured kind of data and deal with it and analyze it to that format. And I think that's really powerful. I think another great analogy that like I again, I don't want to like belabor this point. But a great analogy is that people talk about blockchain and stuff in the space. And the big problem that that that kind of approach has is what I call the Oracle problem is how do you get something from like, the physical world onto the digital into digital? And I think that's, that's a large part of what we do. We take the status quo, and we bring it into that kind of digital future. And I think that concept is super powerful. And it's obviously something that resonates with a lot of our customers.Santosh Sankar  8:32  Yeah, and putting a bow on the paper bit. When people ask me and try to push on it. The beauty of paper across languages, borders cultures, is that it's the most flexible medium. So as long as you know, we have this fragmentation just around the people’s side of things. Paper is going to be a big part of it. And I love that you know how you talked about being the adapter? And I think something that people often mistake this for is Hey, is it just, you know, OCR? I think it's lost on people what it means to be the adapter. Could you expand on that?James Coombes  9:17  Yeah, yeah, for sure. And I also think, like some of the previous kind of previous points that you've done, you've made right in terms of kind of a universal adapter approach. Or, let me kind of take a step back. What we see like what kind of paperwork aspect is really is really in many ways. It's like the content of a contract that people are kind of passing in between each other. And you see this in so many spaces. You see this in a kind of a swift kind of world and then kind of you see it in GDI. You see that even though you've got a bunch of standards, there's always a bunch of like freeform areas where you kind of need to capture the nuance of that communication on that paperwork. I think that's also something that shouldn't be kind of ignored and forgotten that the huge amount of nuance is involved in the paperwork as well. But we capture. Now to your point on the OCR side. Absolutely. I mean, though, OCR on itself is... it comes up a lot. We talked about it in terms of, it's probably like 5% of what we do with a product. But it is really, it's really important to control. We spent a lot of our time. Actually, I mean, a huge amount of time actually building and training our own AI, so we don't use anything else. We use our own. We train them around on literally millions of images. And we've done it specifically in the supply chain space because supply chain paperwork is always really painful. There are watermarks everywhere. People like to print on top of stuff. We do handwriting so it's important to get that right. And so we trained and built our own so we have control and then that feeds the rest of what we do. The balance and this is a kind of a hard bit is more kind of the extraction site is, is to be able to say, you know what it's not just about extracting the text it's about specifically extracting kind of poor learning is why over contain a number of acts. And doing that in a meaningful way but doesn't involve you know, kind of historical approach are like templates and stuff has to do it in a smart way that can adapt and learn with an operator. And that's kind of where the machine learning part of what we do kind of reality comes into the picture. So that is the lion's share of what we do in terms of the extraction site. But you're right, it's leaps and bounds above OCR, and kind of embedding all of that

*From time to time we’ll re-air a previous episode of the show that our newer audience may have missed.* In this episode of the Future of Supply Chain podcast, Santosh sits down with Jon Bradford, Dynamo’s newest partner, to talk about investment opportunities in the supply chain industry. They discuss the shift from startup to B2B, fundamental similarities between supply chain and other industries, building great startup teams, and the vast array of opportunities in the industry right now.

In this episode, we sit down with Ed Clarke, Co-Founder and CEO of Yojee to talk about smart dispatching, route optimization and accountability and control with logistics.

Transcription:Santosh Sankar  0:00  Hey folks, welcome back to The Future of Supply Chain podcast. I'm your host Santos Sankar and joining me today from Ahold Delhaize is Dan Kovar. Welcome! Dan Covert  0:50  Thanks, Santosh. Thanks for having me.Santosh Sankar  0:52   Ahold Delhaize is a big name behind a lot of everyday brands that our listeners are likely familiar with. Could you give us the overview of the business so we can level set the playing field here?Dan Covert  1:06  Yeah, definitely. It's it's very confusing even even for us to work here, so I'll try my best to explain it. So  Ahold Delhaize is a global company. So we've got a bunch of brands in Europe, Indonesia, and the US. the US parent companie is called  Ahold Delhaize USA. Of that there's five brands that we support. And then there's two service organizations. So people that eat groceries that go to grocery stores that are familiar with food on the East Coast, probably now one of our brands. So we've got in the northeast of Hannaford going south, we've got Stop and Shop which is in sort of the Boston Market, the New York Metro market, a little bit upstate New York and Connecticut, throughout that area. Further south, we've got Giant company, which is based in Carlisle, Pennsylvania, that kind of services a lot of Pennsylvania market. From there, we have Giant Foods headquartered in Landover, Maryland, and then our further south brand is Food Lion which makes up a lot of the southeast. I think in in Tennessee Santosh, you've got probably a Food Lion somewhere nearby. Santosh Sankar  2:11  Oh, yeah. Dan Covert  2:12  Those are the five brands. Then we've got two service organizations. The one that I work for is called Retail Business Services, which isn't isn't the most isn't the flashiest name, but it's got our supply chain group, finance group, IT group so anything that would be a shared service amongst those five brands sits in retail business services. And then we've got a digital eCommerce arm as well. Pea Pod Digital Labs is the seventh component of the US business. All of the confusing PDL does all of our digital eCommerce. Anything home delivery, anything on the internet, where you're interacting with brands, buying groceries online, you can all think PDL for that sale. It's a little bit complicated but hopefully that helps. Santosh Sankar  3:05  How did you get into the world of supply chain grocery logistics?Dan Covert  3:11  Yes it's not exactly what everyone thinks they want to be when they grow up. But it's been great for me so far. So I started when I went to undergrad I was a physicist, and I thought that I was going to do something with that. I did some research and avalanche dynamics and snow science thinking. It turns out people don't really want to pay you to do that. So I I saw this offer from  Ahold Delhaize at the time, which was just Hannaford food line brand. And it was first international training program that you got to work for some of the European brands and you got to come back. Get exposed to a bunch of different things. And supply chain seems like the right application for what I had studied so I have a liberal arts degree. I have a Bachelors of Arts in math and physics, which is kind of silly. But they let me use some of those skills, but also get to work with people, which is super important. So that's I think one of the one of the cool things about supply chain, especially food retail supply chain is you're, you're one of the customers of your work. So if you make a wrong forecasting decision, and you're starting to get product because of that, then you're ultimately the end consumer of that. So you might not be able to get the product you need for your family. So I really liked that component of it, just the connectivity to society, I guess. And it's super analytical, which I really like. So that's kind of how I got into it. And then I've really kind of dug my heels into supply chains. And I started six or seven years ago and went back to graduate school for supply chain and, now just like fully, fully in love with the space. It's so dynamic, especially in this time, we're seeing, you know, stuff that we've never seen before and our ability to react and play important role in the communities I think, really critical and a really cool part of this company.Santosh Sankar  5:05  And your oversight now in your current role is around supply chain R&D. So what does that entail?Dan Covert  5:12  Yeah, so it's kind of an interesting team. So it's a really cool opportunity when I came out of grad school, they're like, we're going to start a supply chain R&D team. We want you to go figure out who should be on the team and then go figure out what you guys should do. This is what you're called to kind of a weird opportunity but a great opportunity to bring in a bunch of different people. I think I have the most diverse team in the company. We got people from Russia, Kazakhstan,  India...it's it's a great team. Really, our focus was was on innovation for supply chain. So innovation, super cliche word nowadays, but it's really helping us plan for the future for what supply chain should be. We've got one of the biggest food retail networks on on the east coast. So trying to figure out what what sort of technology we should use, what our strategy is going to be, how we work with, you know, how you and I met through the startup community, how we work with people like you and through your founders camp. It's all of that it's really propelling our supply chain. The future, a lot of it recently has been supply chain analytics. So we saw that as a huge gap when we're doing a lot of our research is that we don't have really robust analytics. That's where a lot of the, you know, exciting new technology is for supply chain. And it's not necessarily physical technology, but in a new software, new way to think about all the data that we have in our supply chain. So we've been we've been really focused on that for the last six months or so. Standing up a team to support that, working with a lot of a lot of cool startups in that space as well. So that's been a super big priority, but I think it's also really important for my team to stay connected to people like you also to any new technology happening in supply chain. Because there's there's so much innovation happening right now. And it's what we think is our is our mission and in this company is to bring that to our company.Santosh Sankar  7:07  Sure. And I'm gonna come back to that theme around innovation and startup engagement. But we'd love to kind of do a grocery logistics one on one. So people understand what we're dealing with here. A lot of folks who have been in our audience and our listener base, to your point, are consumers of the grocery supply chain. They've likely faced kind of stock outs on shelves or longer lead times when they want essential products. But stepping back, how is the grocery supply chain structured at a high level? What should people know about the way food is moved?Dan Covert  7:45  Yeah, so it's definitely one of the most interesting supply chains and I think anyone that works in supply chain thinks, you know, a widget is a widget and supply chain fundamentals are kind of the same. When your widgets expire and have to be thrown out after two or three days. It's a little different from, you know how you deal with that. So it's structured kind of like any major supply chain. We work directly with manufacturers, we have many different distribution centers segregated by temperature state, and by movement class. So we might have the need to pick a facility for super slow movers, whereas you might have fast moving facilities for super high velocity products. So, really fundamental on that side. We've got many different distribution centers that deliver directly to our stores. We also work with a lot of local suppliers, and manufacturers to deliver directly to our stores. So many big food suppliers like beer and soda and chips are all delivered DSD, direct store delivery, to our stores. But then we also work with a lot of local produce suppliers and farmers to get fresher product to our stores. It's obviously more efficient to go right from a farm to a store then, you know cross docking through a distribution center or even slotting into distribution center. One thing that we do some of that, to all those USA brands is vertical integration. So we've got a couple different vertical integration plants. We have one meat processing facility in Pennsylvania and really what that does is brings in sides of beef and cuts into steaks and shipped out to stores. There are a lot more efficient that way than having a butcher in every store. So whenever we're vertically integrated you see a huge growth in that that category in store. So trying to deliver different options for customers and kind of standardize across the company. So it's really a fascinating spot changes because of that perishability and the different sort of order cycle times are really quick. If people work in fashion retail or something like that you're planning like six months to year horizons. Whereas we're planning, you know, what's going to be on sale next week? How about how do we get this product into our stores as quickly as possible? It's it's definitely dynamic, very fast paced, which is exciting, especially in these times. Santosh Sankar  10:25  And I recall in your prior role, you're involved with demand planning. And I'd be curious, like, how is demand planning and equally supply planning conducted in the grocery world?Dan Covert  10:37  Yeah, so it's similar to a lot of a lot of industries. We we plan for promotions. And the thing is that if you're working in fashion, you might have a promotion a few times a year for holidays. We're promoting different products every week. So we're planning for exactly what product is going to be on promo

*From time to time we’ll re-air a previous episode of the show that our newer audience may have missed.* In this episode of the Future of Supply Chain podcast, Santosh interviews Ben Gordon of Cambridge Capital. Ben and Santosh discuss how Ben got involved in the supply chain industry, investing in the supply chain, building a winning team, and strategic advice for logistics companies.

In this episode, we sit down with Ken Braunbach, VP of Transportation at Walmart to talk about retail, eCommerce transportation, and logistics as well as growth opportunities for the future.

In this episode, we sit down with Lance Theobald, CEO and Co-Founder of Securspace to talk about solutions for truck parking and shipping container storage in the supply chain. 

In this episode, we host Paul Noble, Co-founder and CEO of Verusen, and Aaron Meredith, Director of Manufacturing Innovation at Georgia Pacific. The discussion covers the importance of experimentation, change management, and startup/corporate engagement.  

*From time to time we’ll re-air a previous episode of the show that our newer audience may have missed.* In this episode of the Future of Supply Chain Podcast, Santosh interviewed Zehra Akbar, Director of Strategy & Operations at SkyGrid. Zehra and Santosh discussed drone technology, safety, regulations, and industry acceptance.

In this week's episode, we sat down with Rich Tompkins, VP of Southeast Operations at Veryable to discuss flex labor and real-time staffing solutions to help businesses navigate surge and scale issues in today's workplace environment. 

In this episode, we sit down with Bruce Welty, Founder and CEO of Quiet 3PF to talk about autonomous robots, warehouse logistics, and the future of e-commerce and omni-channel fulfillment.

In this week's episode, Santosh sits down with Katy George, Senior Partner at McKinsey & Company to discuss her recent report on Industry 4.0 and the Lighthouse companies that are leading the way for innovation, automation, and worker adaptation in the new digitally-led environment. 

*From time to time we’ll re-air a previous episode of the show that our newer audience may have missed.* In this episode of the Future of Supply Chain podcast, we interviewed John Larkin, transportation and logistics operating partner of Clarendon Capital Management, about the cyclical nature of business, how those cycles impact the freight industry, and finding opportunity in inevitable economic dips.

In this week's episode, we sit down with Sam Ryan, CEO and Co-Founder of Zeelo to talk about personalized bus service for employees and the organization's critical care policy in response to COVID-19.

In this week's episode, we sit down with Justin Lum, Director of Strategic Alliances at Locus Robotics, to talk about robotics, AI, and a new approach to e-commerce fulfillment and warehouse automation. 

In this week's episode, we sit down with Gautam Narang, Co-Founder and CEO of Gatik to talk about short-haul logistics and autonomous vehicles for B2B operations.

*From time to time we’ll re-air a previous episode of the show that our newer audience may have missed.* In the latest episode of the Future of Supply Chain podcast, we sat down with Eric Johnson, senior editor of the Journal of Commerce Technology section. We discussed the 2020 IMO regulations and the impact they have on logistics carriers, port diversification across the United States, and the potential of carriers that partner with multiple transportation management systems (TMS) vendors.

In this week's episode, we sit down with Ben Jones, Co-Founder and CEO of Ohi to talk about micro-fulfillment, micro-warehousing and the future of shipping logistics.

In this episode of the Future of Supply Chain podcast, we spoke with Priya Rajagopalan, CPO of FourKites. We discussed integrating technology to bring real-time tracking and data to the supply chain space.

*From time to time we’ll re-air a previous episode of the show that our newer audience may have missed.* Max Farrell, CEO of Workhound, joins Santosh to discuss how Workhound is changing the way trucking and logistics companies handle employee retention.