Unknown:
0:00
LinkedIn presents
Blythe Brumleve:
0:10
welcome into another episode of everything is logistics a podcast for the thinkers in afraid I am your host Blythe Brumleve. And I am proud to welcome in Barak sundeck. He is the partner at auto tech ventures. And we're going to be talking about the relationship between venture capital and logistics. So there's obviously VCs have had, you know, been in the news a bit as of late. So I'm excited to to dive into, you know, a lot of, I guess, the surrounding culture and investment strategy behind VCs, but also specific to the freight industry. So, Brock, welcome into the show.
Burak Cendek:
0:44
Thank you. Thanks for having me. Looking forward to our conversation. Absolutely.
Blythe Brumleve:
0:48
So we first met back at manifest and we did a quick like one minute logistics interview, and you were so great that I was like, we have to get him on the show for a full length discussion. And as I was doing research for the show, you have such an interesting backstory. And you essentially went to school you grew up overseas, you went to school in Turkey, before arriving to the United States, I imagine you could probably tell the story a little bit better than I can. So give folks who may not be familiar with your background, give them a sense of your journey into coming to the United States.
Burak Cendek:
1:23
Yeah, absolutely. So I'm originally from Turkey. I grew up there and came to the United States for college, went to Caltech studied electrical engineering there back in 2000, a long, long time ago, and then graduated in 2004. And actually, like, my first job, was engineering in engineering, and I joined electromotive diesel's manufacturer of heavy haul diesel locomotives. So started from the transportation back then did that for a couple of years, and then switched to management consulting, in Chicago, worked for a strategic consulting firm for many, many years. And then head couple of my own startups, all fails, so learn what not to do. And then got my MBA from University of Chicago. And then I got into the world of startups and investment through that, I started an accelerator program with my partner in Chicago, back in 2012 2013, bringing foreign startups to the US market. So these are successful entrepreneurs from overseas that have an I have a product or a service that is also suitable for the US market and we help them with fundraising, go to market hiring, business development, everything. Think of it like TechStars or YC, but for foreign startups. So I did that for a couple of years. And through that I was traveling the world quite a bit. And then build relationships with several VCs and decided to join one of the leading venture capital firms in Turkey. So moved back to my home country in 2016. And invested in startups in Eastern Europe, and Turkey. And at the end of 2019, decided that it's time to come back to the United States joined auto tech ventures. And I've been there since then.
Blythe Brumleve:
3:35
So were you familiar. I mean, I imagine like going to school and then moving back. So you were pretty familiar with sort of the logistics infrastructure of Turkey? Is it? Is that a safe assumption?
Burak Cendek:
3:47
All of it? Well, I mean, other than just like those three years as a VC in Turkey, all my professional life educational life had been in the United States, so I wouldn't say I know too much. But I know more about the US market than the church market. Yeah,
Blythe Brumleve:
4:04
we, about two months ago, I mean, obviously, this is a little bit of I don't wanna say like obviously, it's a downer, but that devastating earthquake that hit the country, we actually had a guest on the show that talked about the disaster logistics going on in in Turkey and how it affected you know, the, the ports and the delivery and how they, you know, basically have to, you know, find an airport that's closest to the port in order to get supplies in and they have to prioritize that because without supplies they can't help anybody that's affected you know, by the earthquake and so it was just a fascinating you know, interview so I wasn't sure if maybe you were you know, familiar with the logistics infrastructure of the country, you know, beforehand
Burak Cendek:
4:45
Yeah. Love intimate the but like, It's turkey is surrounded by seas, you know, on three sides. So, you would imagine that they would have taken more advantage of that, like, you know, because of the earthquake like land and all the road freight is a little impacted. And so AR and C was the definitely the key parts of the logistics for that earthquake.
Blythe Brumleve:
5:11
And so you're so, you know, I guess going back to, you know, the with the United States and how you're here now and running a very successful, you know, LP firm or is it? Is it LP or HSBC? Yeah,
Burak Cendek:
5:24
I can tell you a little bit about that, actually. So we are a venture capital firm, early stage. So we invest in technology startups, early stage startups, so more mainly seed and Series A, so these are like, typically already have a product or a service and generating some revenue. And different than many other firms. We are a sector specific firm, so we only invest in a ground transportation related startup. So we don't invest in like gains health IT crypto, just, it has to have relevance to ground transportation. So it can be about manufacturing, supply chain logistics, all the way to e v A v stuff and repair insurance, micro mobility, shared mobility, but all have to do like everything in grant transportation, we have more than $500 million under management, we have a new fund our third fund to under 30 plus million dollars. And yeah, we are we are lucky that in the same way when we have fresh capital and we are actively investing currently.
Blythe Brumleve:
6:32
And when you say the third fun from what I understand about yours, I'm very you know, I'm an entrepreneur, but I'm very new to you know, my my education comes from Shark Tank and the all in podcast. So that is where my my educational level is set. So when you say the third fun, that means it's almost like I guess separate bank accounts that you have that you're funding businesses from that one account.
Burak Cendek:
6:56
No, no, yeah, absolutely. Let's get into that a little bit. So you start with a with your first one, which is typically like for a venture capital firm is the most difficult one because you are like new, like people need to trust you. Why should we trust you? All those questions. So you're, you're new, so you do your first fun. And then what happens typically is like you have a specific time period where you make new investments, let's say like three years, and of course, then you reserves a lot of the firm's reserve some of their capital for follow on investments. So if a company in your portfolio is doing well, you want him as more and more and more to keep your equity. So you have like, let's say, two, three years to make new investments. After that point, you need new money, a new fund to continue making new investment. So typically, like every two, three years, you have a new fund, and you make new investments from that fund. And there might be some money left in your previous ones. But those are like specifically just reserved for the existing investments of that fund. So now we are on our third fund, our fund one and fund two are making follow on investments into the portfolio companies that are in those funds. But new investments all come from this new fund the third one.
Blythe Brumleve:
8:15
And so when you are so it almost sounds like anybody can be a VC, then is you just have to almost like get people to trust you with your money is that I guess a simple explanation.
Burak Cendek:
8:27
So a couple of things like you need to have a track record, like the fund might be new, but the partners, the investors of the fund, have a track record so they can trust you. And then also like a strategy. So our whole thing is like, as I said, sector specific fund, we have been building this ecosystem around ground transportation. So majority of our LP is our top global ground transportation corporation. So these are like car manufacturers, truck manufacturers, parts manufacturers, logistics companies, trucking companies, large dealer groups, auction houses. So those are our LPs. And the reason one of the reasons, obviously, like there is the financial returns, but they invest in us for strategic benefits because they want to know what's going on in the startup world. They want to build partnerships, they want to invest alongside with us. They want to do projects with maybe become their supplier, maybe acquire them in the future. So that's one thing, the LP side then also we have the extended network, we probably know everybody in ground transportation. And then there's the talent piece, we have a head of talent and we have a talent pool specific the ground transportation, so like, Do you need a new head of sales? Do you need a new CTO? Do you need marketing people? So with us, you're not gonna get a pharma sales rep. Right? So you're gonna get someone who comes from the industry. So we help our startups and our founders with we call At portfolio services with their hiring fundraising, oftentimes, for example, generalist VCs, like to partner with us because we bring the subject matter expertise to the table and the network. So we help our founders and startups with, again, fundraising, hiring, business development, channel partnerships, supplier relationships. So that's our strategy, like we've been working really hard, hard to build that ecosystem that, you know, non sector specific fund wouldn't necessarily have. So that's, that's another like, advantage of investing if you want to focus on transportation. That's another reason to invest in a firm like us.
Blythe Brumleve:
10:46
Is that common among, you know, other investment firms to follow a model similar to back
Burak Cendek:
10:53
now? Good question. So, there are a couple of other examples. There's, for example, one in the real estate world, there are a couple of in FinTech world, there are like ones that are like very specific to supply chain, there's, there are ones who are specific to climate. But we are we are, I believe, like the or if not one of the largest ones in current transportation.
Blythe Brumleve:
11:17
And it sort of goes back to the saying, like the riches are in the niches and this niche just happens to be something that the entire globe needs. And and that's, it kind of echoes a big reason why i media wise, podcasting wise, I chose this in it not because I had previous industry experience, but you know, I came from like a sports entertainment background, but nobody was doing it. Hardly anybody was doing podcasts and logistics. And there's, that's a hell of a niche to be a part of, and I use it air quotes there logistics.
Burak Cendek:
11:51
Like it's a huge,
Blythe Brumleve:
11:54
yeah, right. And there's so much I feel like I need to clone myself in order to cover all the topics that that I want to know wanted to cover. But I did want to go back to one of the points that you had made earlier, when you said that you had had a couple different startups and they had failed. Why do you? So so first of all, I guess, what were the big learnings that you had from those startup failures? And how do you think that that helps you with your investment decisions you make today?
Burak Cendek:
12:21
Yeah, no, great question. So I had two main startups. One of them was a services marketplace. And another one was actual, like, so unrelated, we were making shot glasses made out of ice and selling them to bars. So you would put them in a small freezer on the countertop, and like it will be stuck with shot glasses. Oh, no way. And like, you know, you would share the shots from those. In any case, in both of those things, I think the biggest learning was like, I, I started both of these as like, side hustles, like as my with my full time job. And that's I think the biggest thing, like if you if you if you want to start a startup a you need to do it full time. And then that means that you need to have the conviction to do it full time, like conviction to conviction to leave it, leave your full time job and join, or sorry, do that startup full time, if you don't have that conviction. And if you don't have the, if you are not comfortable with leaving your full time job to fully dedicate yourself to startup, you shouldn't do that. Anyway. So that was my big learning from that, like, I tried to do those as side hustles. And I tried to take some time off focus on it full time. But I guess I didn't have the conviction to like burn the bridges and go all in. And if you don't have that conviction in you for your own business, you probably shouldn't do that.
Blythe Brumleve:
13:51
Oh, well. Yeah, that's, that's really insightful, because I think that, you know, going back to, I guess, Shark Tank for a second. That's really one of the bigger warning signs that a lot of the group will give is that if you're working another job, who else is going to be working this full time and they want to know that their money is being taken care of?
Burak Cendek:
14:07
Yeah, that's exactly.
Blythe Brumleve:
14:10
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Burak Cendek:
15:29
Well, first of all, we were never in that mindset like so if you look at our portfolio, there is not a single business where we are like, okay, it depends on the on that growth and growth at all costs. And like, it can only survive with the VC money, like all of our investments, of course, like you need an investment to build your product, and to get to a certain point where you are cashflow positive, but all of them are at their unit icon, Amex, or contribution margin wise, like profitable businesses, or have a plan to be profitable. So and we on purpose, stayed on the sidelines on some of those trends. Like for example, like when Micromobility was really trendy, like the scooters and whatnot, we stayed away, like we didn't touch any of those. After that trend. fizzled out, we made micro mobility investments, while we made investments into companies that are, again, their unit economix their profitability. Were very strong and positive. So we so we were never one of those investors, and we remain to be the same, like we look at our businesses with that lens is does this, when you look at the unit economics, when you look at like, Okay, you are burning the money, but what are you burning that on? Are you burning that on actual for building the business? Or are you burning that money to acquire more customers and like, you acquire a customer for $100, and you make only $10 Out of that, like, you're and you're losing millions of dollars on every customer. So
Blythe Brumleve:
17:09
we sell those unit economics wouldn't work, right? In that example, okay? That
Burak Cendek:
17:14
like in order to keep growing, you need to burn, burn, burn. But it's okay that like, you know, you spent $50 on a customer, and then maybe like, in a year you make $100, that's fine, like, you're gonna burn that $50 In the beginning, but at the end of the day, you're going to start making money and that customer is going to start contributing profits to your business. So we we remain disciplined in that sense. And we continue to invest in businesses that have that has that have positive unit economics.
Blythe Brumleve:
17:47
And so when when I guess you're analyzing a lot, what, how many business pitches? Do you get a day?
Burak Cendek:
17:53
Good question. So on average, like we and we keep track of this continuously. So currently, at an annual basis, we see more than 3000 companies new come. And then we probably get like 2000 updates as well, from pre like companies we were in touch with earlier. And we are proud that is a sector specific fun. Like we want to be the first call for any funder that is starting ground transportation relate to start up logistics related trucking related startup, we want to be the first call. So we want to be able to see everybody everything happening in this space. And like we we we keep that statistics like what percent of the deals at series A do we see? before they happen? And how far in advance? Do we see that? So we definitely keep track of that. And we improve that the year over year.
Blythe Brumleve:
18:55
So with with the amount with 3000 submissions that you're getting each year, what stands out to you as far as like what makes for a good startup? I mean, obviously profitability is one of them. But are there any other signals of what makes for a good startup?
Burak Cendek:
19:09
And again, profitable not at the company level, like of course, this is a startup, they're burning money, they're not yet profitable. So, at an early stage for me, I am very tuned to the team. So team is the most important part of the equation here everything else changes, but the team is constant, because like nobody would have predicted COVID Right, but things like COVID comps, new competitors, comps come or regulation changes. Inflation like the environment is constantly changing. But you are making a bet on the founder who can address those changes like something happens and they can act react and change their model and continue executing on their strategy. So team is the most important apart. And then next to that is market. Of course, like it's okay to start from a niche market. But you don't want the mess in a business that is like, even if you capture the whole market is gonna make like 10s of millions of dollars like that's, that doesn't balance the risk reward, unfortunately. So you want to invest in a good team in a large market and have signs of product market fit? So like is, is this product, something that market that large market really wants? And is it flying off the shelf? Or are you trying to push it shower, you know, into the market. So pull versus push like is, is the demand is the early signals there that shows that like, this is something that the market really, really needs. Again, if it was that part is a little, it's not very clear, this is not very certain, like if it was like everybody would have picked winners. So they're like, it's especially at the early stage, you try to look at the signals, you talk to a lot of customers, we, for example, we have the luxury of having LP base, our investors, LP base that are potential customers of a lot of the startups we talk with, so we pick up the phone and talk to them. Hey, there is the start that we are looking at. Is this a pain point? Is the product the service they're building? Is this a pain point for you? Would you be interested in using this product? So we tried to get a lot of feedback from their existing customers, potential customers to see if if there are early signs of that product market fit.
Blythe Brumleve:
21:41
And it sounds like that that's a benefit of the overall ecosystem that you guys have built obsolete. And so when, when we talk about, you know, sort of finding, I guess, those hidden gems as any of those qualifications different for, you know, freight companies, transportation costs, I mean, if that's all you focus on, that's probably the characteristics that you're looking for. Is that a safe assumption?
Burak Cendek:
22:01
Yeah, absolutely. Like the differences there. I learned this early on, like when when I started in, investing in logistics space. You know, my one of my first investments as a VC was in a warehouse, software, WMS. Business, and then got into tracking make some investments in trucking related technology. One thing I noticed early on was, a lot of startups are basically tech enabled brokers that come as technology and software companies. And I was also like, in the very beginning, impressed by a lot of the growth of these companies that I would see like, Oh, my God, like they're doubling tripling their revenue. But then you look at it, it's like a tech enabled brokerage. And then you look at that world that like, I think a lot of very successful entrepreneurs, and founders and business people build very successful brokerages, but those are not software, those are not technology companies is it's a brokerage, and that's not the business we are in. So that's, for example, like one thing that I learned early on, and I feel like you know, somebody who is not a sector specific fund, who doesn't see a lot of like trucking related businesses, for example, would definitely be impressed by that growth. And we'll then maybe even invested in that company without realizing that it's actually a tech enabled services business, another technology company and other software company.
Blythe Brumleve:
23:30
I was in that sort of exact situation working out a three PL like 10 years ago, and we had some a we had funding from a bank that ended up coming in years later. And the underwriter for the line of credit, did not understand that an asset based trucking company, and it was very quickly I think, within a year that they it was it was one of the many financial decisions that led to ultimately to the company collapsing. But we dealt with that same situation where the fund did not understand sort of the economics of how logistics works, that a truck goes down, you're probably out, you know, half a million dollars for the repairs and the lost revenue on that one truck alone. I mean,
Burak Cendek:
24:13
there are investors who are interested in those type of companies for sure, but not not not venture capitalists. Yeah,
Blythe Brumleve:
24:19
it is definitely it sounds like it's it's an entirely different beast. Now. Now, one of the quotes that I wanted to get out because I was reading on your bio is that auto tech is on a mission to solve the world's greatest or solve the world's ground transport challenges. I guess you could add greatest in there too, with technology and realizing the next frontier in mobility. But with the freight market just being so volatile, right now, how are you finding those hidden gems? I guess it's probably one of the 3000 submissions that you're getting each year that they're almost finding you. It doesn't sound like you have to do much, you know, outward or outbound research.
Burak Cendek:
24:57
Let me clarify that like a lot of that of course like you inbound, we get a lot of like, leads from our pitches from inbound leads. But we also get a lot of from our founders that we back our portfolio companies, our LPs, other investors. And then we also do a lot of outreach. So like we look at people who are coming from, let's say, como somebody left Cambodia and started a startup, like, we identify these people and reach out to them? And like, Hey, are you building something and ground transportation? Can we talk, or like we see like somebody received an angel investment from an angel investor that is in ground transportation. So we reach out to those companies and see what they are building. So we do a lot of outreach ourselves as well. And then start building relationships and offer introductions to those companies as well. Like, it's, it's not just like, hey, I'm Brian, I'm a VC, I have money, like, let's talk, what are you? Like, also, like, how can I help? Is there anything I can help you? And then as those companies progress and grow, and do their fundraising, then then we take a more active role. But coming to your question about like, how to identify the germs. So again, like one of the benefits of being a sector specific fun, is, we see a lot of companies a lot of activity in buckets. And like after a point, like your pattern recognition engine kicks in, like, Oh, something is going on here. Like, you know, we see a lot of smart people spending a lot of time here, what's going on? And we built thesis like, okay, like, where's the world going about that specific problem? What do we expect? What is going to happen? What are some of the solutions, services products that might be relevant in the future. So we are we try to be a very thesis driven company. So it's not just like a startups come and pitch to us. And then we pick the ones that we want the most. And we are actually also come up with thesis, our own thesis in certain domains, and then go seek out investment opportunities that fit into that thesis.
Blythe Brumleve:
27:14
And I think some of the so it was also on that same bio, it says that you invest globally and see through a series see startups, but it's also around connectivity, autonomy, shared us electrification and digitization of enterprise. And the team is also excited about deep tech, autonomous AI, semiconductors and business model innovations in marketplaces. And so when we, when we talk about freight and transportation, it's not often that you hear sort of, you know, semiconductors and things like that being, you know, a part of that investment strategy, but with your investment strategy also focused on autonomous vehicles as well. I imagine that's where the two of those sort of merge together
Burak Cendek:
27:54
Yeah. So, we are we are not just logistics and supply chain right. So we do ground transportation and when you think about ground transportation, of course, like you know, anything related to automotive and cars and trucks come into play too. So semiconductors like we are, we are investors in in in the semiconductor, which went, which went public, and you know, successful growing, so they were making semiconductors for the automotive industry. We are investors in an autonomous construction and mining equipment company called Safe AI, we are in a company called burden that is making autonomous agriculture equipment. So like there are those pockets within our firm I do I spend most of my time in logistics, I think compared to all of my partners, I am the one who spent more time in logistics and others, logistics supply chain, and then fintech. So those are like the three buckets that that I spend most of my time.
Blythe Brumleve:
28:52
Now I know that you probably will say like, all of them are your favorite just like you know, every parent says like, you're all my favorite children. But do you have you know, maybe like one or two of the companies that you've invested in that you really see as a crazy future crazy, good future for them.
Burak Cendek:
29:08
I mean, all of them are like that. I think you're
Blythe Brumleve:
29:12
right, like your all my favorites.
Burak Cendek:
29:15
tell you, for example, like one of our one of the areas that I am looking, let's say that, I can tell you what I am looking for our next favorite one, for example, like we have nice reverse logistics space, return space quite a bit like we probably talk to all the startups in that space. We believe that it's a big, big, big pain point. We haven't made an investment and we really want to make an investment in that space. So if anybody is listening to this podcast that are doing anything related to returns and reverse logistics, for example, we would love to talk with them. So that's one area that like we have a certain thesis around that. And we talked to everybody we haven't found anyone that fits into that thesis yet.
Blythe Brumleve:
30:00
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Burak Cendek:
31:30
I think I feel like we are not even there yet. Like, you know, in order to apply AI or automate things, unit to first digitize things like and we are still like, struggling with that, I think in the industry. And like, that's actually like, one of the areas that we spent a lot of time how to digitize existing processes. So that like in the next, you know, second step, third step, fourth step, we can start automating those, and we can start applying AI to those. So like digitization is definitely an area that we spend a lot of time we are investors in a company called Coulier. Now with a que they do customs clearance automation. And it's all about how to digitize all the different documents and processes that go into customs clearance. And we are investors in a company called neutral that are making freight booking digital, so they integrate with the TMS is of the brokers and make those loads digitally bookable to the carriers of those brokers. And so that's that's one area. And related to that, again, like fragmentation is a big problem in the industry as well. You know, a lot of the freight I think marketplaces were supposed to consolidate the market, but in my opinion, they further fragment the market like now like the carrier and the owner operators tracking companies, they need to call their brokers but nominate, they need to look at three different platforms five different applications. So it's like getting further and further fragmented. So we thought, we thought having a layer that enables those different fragmented pieces, both from a stakeholder point of view like different brokers, different shippers, different carriers, but also platforms, different TMS is different load boards, without those talking to each other, it will be really difficult to apply certain, you know, artificial intelligence related applications and solutions. So that's that's another area that we spent a lot of time as well related to Ai
Blythe Brumleve:
33:46
do you see a world where you know there's like a chat bot on top of a TMS and somebody can log into the system and tell me you know, the best route for this commodity and I want to backhaul and all that you know sort of details of how it really could maybe rapidly it is on
Burak Cendek:
34:02
industries there is this trend like there's this trucking in a box type of companies on the on the carrier side that basic the promise that like hey look, we're gonna collect all the loads from different load boards, broker shippers, bring them to one place and pick the best load for you and pick the best load for your return trip give you the you know the all the accounting gives you all the back office functionality give you the sport give you the fuel card, also handle your finances. So I think you know the world is going in that direction. But again, like in order for those types of applications to run successful, you need a more connected and digital infrastructure.
Blythe Brumleve:
34:51
I think data to is also a big issue and making sure you have clean data I you know for so long I've wanted you know just the ability from from like a a marketing perspective, just be able to, you know, mark it to specific, you know, commodities that are coming in season or, you know, I don't know, Christmas trees are coming up, or, you know, can I make a campaign around that, and the TMS software wouldn't be able to tell me that story. I mean, this is 10 years ago. But nowadays, it's it from a lot of the marketers that I talked to, they're still experiencing the same issues, where they are kind of just flying in the dark, and they don't know which direction to go into. And you have the, it's not just silos within the industry, it's silos within entire companies as well.
Burak Cendek:
35:34
Yeah, and I see a lot of that same thing afraid, like, I mean, it's siloed so much, between the companies and within the company. And then even documents, like a lot of the documents are standardized, but there's still so much of that going from paper to like, you know, you take a photo, maybe it's PDF, but then it's printed again, and then it's like, it's like, you have a paper, you take it, you digitize it, you print it, and it becomes paper again, then you digitize it. And then like because again, there's there's no digital unifying infrastructure rails that connect all these different pieces together.
Blythe Brumleve:
36:13
And so when we, I guess, when we think about sort of the future of like, freight and technology and and sort of the intersection, especially when it when it comes to communications as well, where do you you see, I guess, sort of all of these converging, do you see them converging? Or do you still see them kind of isolated in a silo for the foreseeable future?
Burak Cendek:
36:32
I don't think it's going to happen overnight. But definitely, like companies like clear now neutral, they are trying to address that. And, yeah, of course, I believe in that future. And I believe that we are going in the right direction.
Blythe Brumleve:
36:47
Now, I guess so you know, a couple last questions that I have for you, and a kind of hinted at, you know, sort of earlier is that for someone like me, who watches, you know, Shark Tank? And I wonder from like a VC perspective, how accurate is that? presentation format? Is there all the debating? And you have to go through all of your numbers live on stage that actually happened?
Burak Cendek:
37:09
Yes, and no, I'm in, of course, that pitch is an important piece of the process. And for many, many reasons, like, of course, like you get your information, you get to know the founder, you get to hear their story, which is also important, but you also try to evaluate if they are a good leader, like can this person attract talent? Because we which is very important, like, are they going, are they per se? So are they able to tell their vision in a way that that can convince someone, for example, who has like a good job with high salaries to jump the ship and join a startup? Like, are they charismatic? So like you're trying to evaluate that as well. So pitch is very, very important. But I think the real sprint starts after that. So you here after you get like, you need to do your due diligence, like, again, like we talked a lot of customers we talked to we talked to competitors, like, let's say that you agree with that. Let's say that that's founder has a unique insight or unique product, or like you like that market, but how do you know that that is the best business, best startup the back in that market? Oftentimes, like there, these things come in like waves, like you, you see a lot of truck payments companies, you see a lot of load boards, you see a lot of TMS is they come in batches in a way you want to pick the winner, you want to pick the best one you can. So we talked to their competitors. We talked to the other team members, of course, we look at their numbers and this that like we spend a lot of time doing due diligence. And then only after that, we come to a decision to invest.
Blythe Brumleve:
39:01
So if you are you know, if you're an entrepreneur or an aspiring entrepreneur in the freight space, what advice would you give to somebody who has an idea, and they they want to explore the possibility of getting funding for that idea.
Burak Cendek:
39:15
I would advise them to start with a pain point. Not not a solution. Hey, like not I have an idea. Like what is the pain point you're trying to solve? How big is that pain point? Oftentimes, like I think, and to be honest, like there's so many pain points in this industry that that that shouldn't be that difficult, right? So pick out a pain point that is very large and a lot of people are suffering from and then you're passionate about because of course like it's a roller coaster, things are gonna go up and down. And you need to be passionate about what you're building what you're solving, so that you keep going and you don't give up at The first sign of hardship. So like, I would start with the pain point, and the customers, and then go from there, and that will make your life easier. And it will make it easier to communicate to potential investors. And it will, it will make it easier to get customers as well.
Blythe Brumleve:
40:20
And should you build what like an MVP first or
Burak Cendek:
40:24
first, like, you know,
Blythe Brumleve:
40:26
it's not just an idea, you put it on paper, and then you go to an investor. And
Burak Cendek:
40:30
it happens sometimes, like sometimes like, some ideas are very, very good. And some founders are really, really good, like, you know, and then like you want to be with them from day one, almost. And, and you can write a check, even when at an idea stage. But in order to, you know, of course, if you just go with an idea stage and get investment, you're gonna get it at a lower valuation, because the risk is so high. But if you get an MVP, if you get some initial traction, then your valuation will go up, so you're not gonna get diluted as much. So I would definitely suggest bootstrapping, if it's possible a little bit until maybe you have some product, some initial customers, that would go a long way to I think, increase the value of your business and also illustrate that there is a real pain point here, and you have signals for product market fit.
Blythe Brumleve:
41:29
And then, you know, with all of that said, you know, what, once you you know, sort of reach, I guess, the upper echelon of success, and that sort of I guess segues into my next question of like, you know, the success the overwhelming success of the, you know, the all in podcasts, are you a regular listen to listener to that show?
Burak Cendek:
41:47
I wouldn't call myself regular.
Blythe Brumleve:
41:51
So, well, I was wondering if that because they've seen a lot of success with the show. And then of course, anytime you have more eyeballs on your product, you can talk about more of your investments and things like that. So I was also wondering if maybe you, you know, from the from the sidelines, maybe looking in, if that is a signal to like other VC firms that they should start up their own podcasts in order to be almost like the megaphone to the companies that they're investing in?
Burak Cendek:
42:15
No, absolutely. I mean, that's, that's a really good point. Or, you know, we can join forces with podcasts like yourself, tapped into your audience. mencionar don't steal
Blythe Brumleve:
42:29
our thunder. All right, Barak, that that was about it. For the questions that I had. This was a fascinating conversation. I feel like I could I could continue talking to you know about AI to you, and about the revolution and the evolution that I'm seeing for a lot of freight companies in this space, I think I'm going to do, you know, maybe we'll have you on again, in the future, after I do a little bit of a roundup of, you know, some of the executives that are talking about how they're using AI, because I just I think it's completely fascinating. So looking forward to watching your journey, and the journey of all the investments that you guys are making over at Auto Tech. But for folks who want to stay in the loop as well, where can they follow your work, follow auto tech, you know, all that good stuff, maybe send you a pitch to and be one of those.
Burak Cendek:
43:11
Thanks, thanks for reminding me that, so they can definitely follow me on Twitter, although I haven't been very active lately. But feel free to add me on LinkedIn, I actually have my have office hours, weekly office hours. And it's open to anybody, I have a calendar link on my LinkedIn profile. So if they go to if they search for my me on LinkedIn, find my profile, there's a calendar link there, they can sign up. For my weekly office hours. Again, it's open to anybody, they don't even need to pitch if they, they might just get feedback on their idea on their product. I would love to talk with them and welcome anyone who would love to have time with me in my office hours.
Blythe Brumleve:
43:57
Awesome. That sounds great. That's really generous of you to be able to offer up time like that. But I imagine it helps, you know, with getting awareness and staying on top of everything that's going on within the industry. Of course,
Burak Cendek:
44:08
ya know, it's my pleasure. I mean, it's, it's, it's also like part of giving back to the community. So I truly enjoy, like, sometimes you stumble up on things that you didn't think about, you wouldn't have been proactive about. So it's surprising. And then sometimes, like you meet a founder, very, very early at the very early phase of their journey, and they come to your office are and your feedback and they stay in touch and they start building a successful startup and it's it's all about helping each other.
Blythe Brumleve:
44:39
That's awesome. That's a great perspective and in a great attitude to have towards towards the industry. And I think probably a way to sort of break down some of those silos that we've been talking about that's been such a hindrance to the industry for generations up so brought. Thank you so much. Thanks
Burak Cendek:
44:54
for having me. It's this has been a great conversation. And I would love up to I have future conversations on like maybe just about AI or other things in the future.
Blythe Brumleve:
45:06
Heck yeah, I'm gonna be booking a slot on your calendar here and like the next five minutes all right, well, thank you for rock this was awesome. All right I hope you enjoy this episode of everything is logistics, a podcast for the thinkers in freight, telling the stories behind how your favorite stuff and people get from point A to B. If you liked this episode, do me a favor and sign up for our newsletter. I know what you're probably thinking, oh God, another newsletter. But it's the easiest way to stay updated when new episodes are released. Plus, we drop a lot of gems in that email to help the one person marketing team and folks like yourself who are probably wearing a lot of hats at work in order to help you navigate this digital world a little bit easier. You could find that email signup link along with our socials in past episodes. Over at everything is logistics.com And until next time, I'm Blythe and go Jags
