SME Spotlight

Riding the digital Silk Road to success

Mr Desmond Tay, co-founder and chief executive of vCargo Cloud, said there is not much innovation in the trade and logistics industry. He added: "We want to disrupt the industry, by building a platform."
Mr Desmond Tay, co-founder and chief executive of vCargo Cloud, said there is not much innovation in the trade and logistics industry. He added: "We want to disrupt the industry, by building a platform."ST PHOTO: YEN MENG JIIN

vCargo Cloud's platform links key players in the global trade and logistics industry

Camels and horses were commonly used to transport goods across the ancient Silk Road, a lucrative network of trade routes that connected both Europe and Asia.

Now, home-grown trade and logistics company vCargo Cloud's CamelONE cloud platform aims to be a digital incarnation.

The platform connects key stakeholders in the global trade and logistics industry, such as government agencies, traders, freight forwarders, warehouses, airlines, shipping lines and financial institutions. Users can process transactions, exchange documents for trade compliance purposes and source suitable trading partners all under this single digital platform.

Mr Desmond Tay, co-founder and chief executive of vCargo Cloud, said that while there are many companies that have been doing trade and logistics for decades, there is not much innovation in this complex industry. He said: "We are not going to position ourselves as another company selling software. We want to disrupt the industry, by building a platform."

The roots of vCargo Cloud stem from previous iterations Mr Tay and his partners had started.

One of his earliest firms was BizLabs, founded in 2003, which helped companies and government organisations manage their financial, procurement and inventory processes. Subsequently, with a few other partners, he formed Visiflex. The new company focused on both local and foreign e-government projects, some of which were continued from BizLabs. These included revamping the trade network for Mauritius, an island nation off the coast of Africa.

This was a project Mr Tay credited for kick-starting vCargo Cloud.

In 2013, he and his partners founded vCargo Cloud for the purpose of creating a specialised trade and logistics company, making Visiflex a holding company.

They began building up and deploying their CamelONE cloud platform, which would cover the needs of the various stakeholders in the trade and logistics company.

At the same time, they developed their pay-per-use business model for the platform. In other words, the party that benefits from the transactions pays a cut to vCargo Cloud when it uses the platform.

Fast forward to 2015, tech group DeClout acquired a 30 per cent stake in the company for $7 million, followed by $8 million for an additional 20 per cent a year later. So, DeClout became the majority shareholder with 50.01 per cent and vCargo Cloud was made a subsidiary.

Mr Tay said the acquisition helped to accelerate the growth of CamelONE, allowing the platform to move to a more regional level.

On the choice of projects the company subsequently takes, the co-founder said: "Ultimately, we are looking at trade routes that we want to exert a presence. One of the key trade flows is the Belt and Road Initiative (BRI)."

The multibillion-dollar BRI was set up by the Chinese government to promote connectivity and trade across Asia, Europe and Africa.

Last year, with the support of the East African Community, vCargo Cloud launched the centralised Single Customs Territory in Eastern Africa. The CamelONE platform enabled interconnectivity of Customs systems and sped up the cargo shipping process among five African countries - Kenya, Tanzania, Uganda, Rwanda and Burundi.

Several months later, the platform was deployed as an Information Exchange Hub in the Central Asian countries of Azerbaijan, Kazakhstan and Georgia, facilitating the flow of transit cargo between Europe and the rest of Asia.

Earlier this year, the platform provider also signed an agreement with Mauritius Network Services - a client Mr Tay has been working with since BizLabs - to initiate e-freight solutions for the country's trade and logistics industry.

Mr Tay said one of the strengths of being a Singapore company is the ability to form cross-border connections. "Being cosmopolitan, we have experience and exposure in different countries, regions and cultures."

A version of this article appeared in the print edition of The Straits Times on March 14, 2018, with the headline 'Riding the digital Silk Road to success'. Print Edition | Subscribe