Multiple sources with knowledge of the situation say that real-time visibility company FourKites plans to shut down ocean shipping document management and tracking solution Haven by the end of this year. Mathew Elenjickal, Haven’s founder and CEO, says that Haven has just become a part of a bigger platform.
Elenjickal confirmed that the company has also fired a number of people.
In April 2021, FourKites bought Haven so that it could use its document management features in a new product for visibility. That product is called Dynamic Ocean, and it would give global shippers one place to manage their supply chain.
According to an email sent by Elenjickal and gotten by FreightWaves, the Chicago-based company’s board has asked for a full “product portfolio review” to make sure the company’s products are in line with what the market needs.
“Haven modules are one of our least profitable product lines, according to our analysis,” Elenjickal said in the email. “It costs us almost $50 per container to serve the documentation module, and BCOs aren’t willing to pay even close to what it costs them.”
Acquisition due diligence failure
In an interview with FreightWaves in April 2021, after the Haven acquisition was announced, Elenjickal said that Haven was the piece of technology the company needed to build “an end-to-end platform that manages ocean transportation seamlessly.”
“It will help you communicate with steamship lines, make bookings, and change bookings, starting with the booking process. It has a strong documentation platform, and you can set the rules based on the country of origin and the country of discharge. You can also ask, “What documents are needed for a smooth transfer, who is responsible for that, and when should I upload the documents?”
A user of the product who did not want to be named out of fear of retaliation said that Haven’s document management features never came to fruition.
“I think what [FourKites] saw was that customers didn’t buy Haven for its track-and-trace features. “It was more for the sake of documentation,” the source said. “They saw that more customers weren’t necessarily interested in the [track-and-trace] feature of the product…. We only bought it because of the paperwork.”
Elenjickal confirmed this in an email, saying that he “assumed this was a reflection of the value (or lack of value) of the documentation module to [FourKites] customers” because the beneficial cargo owners weren’t willing to pay the costs that FourKites didn’t think about when making the acquisition.
According to the source, Haven and its integrated solution Dynamic Ocean didn’t sell as well because they couldn’t handle documents. The source said that FourKites representatives said the company had only been able to add four more customers since it bought Haven.
When FreightWaves asked Elenjickal for a comment, he said, “Haven features have been added to our main Dynamic Ocean platform, so Haven doesn’t need to be kept as a separate product.” Dynamic Ocean is still a profitable product line for us. In the past year, the number of ocean shipments on our platform has grown by 240%.
Elenjickal said that his comments in the email were about the Haven Freight Audit Module and not about Dynamic Ocean as a whole.
Reports on layoffs
According to other people who know how FourKites works, the company has fired a number of people this week. It fired some people who worked in general sales. Other jobs that are being cut are those in sales, sales engineering, and implementation for its yard management software solutions. The company also fired an unknown number of people who worked as product managers and engineers. The source thinks that FourKites will give some jobs to people in India.
When FreightWaves asked Elenjickal for a comment, he said, “Yes, we have had to make the hard decision to let some of our colleagues go. As is the case with many other businesses, we had to make some very hard decisions to make sure that our business would be profitable in the long run and grow in a way that would be sustainable.
“As we look to the future, we will keep coming up with new products and forming new partnerships, like the one we just announced with FedEx. We will also continue to support our customers and help them add value to their entire supply chain.”
