Bear with me, this is the full story — tl;dr coming soon.
Let me tell you first a little about myself. I’m writing this on the plane as I’m flying out from Vancouver to Toronto. My wife is already in Toronto; she’s been there for two weeks already to take care of the final preparations for the wedding. She is originally from Toronto and we’re getting married next week. I’m super excited, it’s more exciting than all this attention from media/investors — more important foremost, because she believed in me before I had my first job. Before I even started working hard in school. Before I started taking life seriously. She loved me unconditionally, and I love you.
I’m from the Netherlands, born and raised, but we met in China, lived in Hong Kong for a year, and since May of this year, we’ve called Vancouver home. I studied a diverse program at Erasmus University Rotterdam, called Informatics & Economics. Such a grave mistake they discontinued the program because it wasn’t making them money — I was lucky enough to have caught one of the last batches. By the time I graduated, they had cut the program already. It allowed me to try out all the different disciplines, and then pick and choose from any Masters program. The one I ended up choosing is Computational Economics with a focus on Logistics. In international terms, we call it Operations Research.
Inception of Routific
Let me tell you what went down, 8 days ago, at Vancouver Startup Weekend. I pitched my idea, it got voted to be among the top 17 (11 votes only though, just enough to make the cut — perhaps telling?). Then I went to recruit a team of 9 people. Next morning, as we sat down to work, 3 people left, because they didn’t share my vision. We became a strong team of 6, who all had faith and wanted to win. 54 hours later, we were standing on stage as winners of Startup Weekend Vancouver. Can you believe it? And now we are getting serious.
Because you have to build something in 54 hours, you need a team of 6. You wouldn’t have been reading this if it weren’t for that team. So yes, we won the competition, but that was just the begining. Just a sign that I’m on the right track. The following Wednesday, we had a chance to present at Demo Day and have a live demo at Launch @ Grow.
We’ll be ramen profitable. We might turn a profit in 3 months. Scale that to potentially a million by next year.
But that’s not what I want to talk about. I’m tired of everyone being so focused on money. Stop launching startups because you want to get rich. VCs, stop arguing over term-sheets, because you want to make a buck — now is the time to do some good with the power you have. Obviously, this message is not meant for every single one of you.
Once I realized that I had something real, through customer validation, market research and getting nothing but positive feedback from the brightest minds on this planet, I thought to myself: “Ok. I need to keep this on the down-low, develop it quickly, then scale it quickly and capture as much market share as I can, and get rich quickly.”
Somehow, today, I’m thinking back at that thought and I know that I wasn’t thinking clear at the time. Now I’m thinking clearer than ever, and I have found my purpose in life. And I’m going to share it.
So what’s the secret
The secret is that it is so easy. Routific is not rocket science. It is using algorithms from 40/50 years ago. We’re basically solving a TSP for destinations up to 50 nodes. Yes, everyone has done this as a school assignment at some point, if you did a degree in Math or CS.
It’s only day 8 but I had constant strokes of insights in just 1 week. Now, I have a clear vision, a clear mission. The world needs to know what’s on my mind.
In our field of study, Operations Research, there is a lot of inter-disciplinairy stuff going on. A lot of cool ways to apply Math and CS to solve real business problems. OR has been around for decades, but has always been focucssed on Academia. Only in the last decade or two, has there been the computing power and resources for a push to apply it in the world. But not for the right reasons.
Let me tell you that Routific is about saving fuel, time, and money on deliveries. You think VRP. Good. So if I’m telling you that all that Routific is doing, is putting a simple algorithm on the cloud, and solve Vehicle Routing Problems, WHAT ARE YOU THINKING RIGHT NOW?
Hold that thought. The brightest minds think exactly what you’re thinking. This has been done before. You’re thinking UPS, you’re thinking FedEx. People with more experience in the industry will tell you that there are dozens of Routing Solutions available. A couple of them are in the cloud. BUT, none of them are in it, because they want to help the planet turn a little more efficiently.
They are forgetting what it is all about. They don’t see the big picture. That is why their focus is on the big guys. That’s all they see. They think they’re the smartest (which they are by most measures — like papers published, but we’ll get to that later), and they think: “I can help the largest Logistics companies be more efficient, so that they save millions and I can get a sweet bonus.”
The bonus is sweet, but do you feel like you’ve committed yourself to bringing value to the world? Will this place be better off, because you help these big guys get bigger?
Well, yes, because you’ve managed to cut 20% fuel consumption and saved billions of waste — waste that can be prevented by hard proof. Ok. Now what? What’s next? Try to push for another 1% additional efficiency?
No. Let’s move on to bring it to the massess. Go on, don’t be afraid to share — do good and good will come back to you.
The best part is, you don’t need a PhD in OR or Math to do it. You don’t need to know Constraint Programming or Mathematical Modelling to do it. You do need CS skills though — we’ve got plenty tied up in startup hubs. Most important ingredient though: A clear vision, a clear mission.
But first, let’s start by not running hot water when you shave or do the dishes.
Why am I writing this?
I believe in karma. I wouldn’t have had this stroke of insight if it weren’t for karma and the law of attraction. I just learned this from a mentor.
I genuinely believe that the world needs to know this, asap.
You might think it’s foolish for me to do this, because anyone could now jump in and compete. If you’re thinking that, we’re not thinking in the same paradigm. But to reassure you for now, there is enough pie to go around. I will give you the recipies below, so you can bake them yourself.
What it does do for me, is that it prevents someone else from stealing this pioneering idea and making it their own. 150+ VCs heard this pitch last Wednesday. Right after all the craze, one developer went rogue (and hijacked routecaptain.com). I’m afraid someone might ruin this new revolutionary opportunity for everyone.
I don’t want a claim to fame, but I want to make sure that this secret is in good hands. The only way I can be sure of that, is that I let the world know now, that I am pioneering this, and I’m doing it for the planet. Which is the reason why I didn’t write this on my personal blog — it’s not about me any more. I want you to stop focussing on the petty, mundane things in life. I saddens me to see it every day, and I’m sure you know what I’m talking about.
Having said that, even if some opportunist is going to jump in and replicate Routific and capture 80% of the market share, kudos. You’ve just helped me achieve my mission.
I’m telling you, there is enough pie to go around — the Transportation industry is a trillion dollar industry — let’s work together to make it more efficient.
On The Origins of the Idea
The morning after my graduation, my cousin drove me to the airport, because I was about to fly to HK to start a new career as an Equity/Algorithmic Trader. In the car, he said: “Hey, that thesis of yours, you should go put it to practice maybe? Go approach shipping companies and tell them you can save them millions?”
That idea was always on the back of my mind, and was eating me from the inside as I started to understand the Investment Banking world…Basically, the point is that I’ve been planning to do something with it for the last 2 years. I was thinking about private consulting, just like everyone else, but I never made the move, because I was unsure how it would work out (high risk) and a typical sales cycle for a $200K VRP solution is about a year or so, and would require months of politicking and shiny presentations — what a waste of my time. And what I like about OR is that it is about cutting waste, because waste is a waste — which is a waste.
Yesterday, it came to me — miraculously, because of the magic that Startup Weekend caused. I’m not claiming these ideas to be mine. They are inspired by every one around me during the last 8 days. I’m just paying it forward.
Save fuel, time, and money on deliveries.
We are providing a simple Local Search heuristic in the cloud, and bringing it to the people that need it most. The courier drivers directly. Everyone is so fixated on the big boys, that they seem to neglect the small guys, the individuals. They are the ones that pay gas themselves — they are the ones that work on commission — they are the ones that get a pile of boxes every morning and have to sort it out themselves. We’ve got our first customers waiting in line.
See where I’m going? Roughly half of all the courier drivers in the world, work for the Top 3. The other half? They have the same problems, but no solution, because all intellectual effort is foccussed on the big guys, for the wrong incentives.
We are changing that. Let Us Lead the Way. We are bringing simple OR solutions, to the massess. I could use your help.
I’m not afraid of people stealing this idea. I believe this idea belongs to everyone, and I believe that the community that will back this up will overpower the individual that tries to make a quick buck. Open-source/crowd-sourcing movement has proven to be powerful. Let’s use that same force.
There is nothing more to Routific. It’s literally that easy. Sadly, nobody seems to take a second and appreciate the beautiful blue ocean…
Let me tell you that the field of OR is lying wide open. You don’t need to compete with us, there is enough pie to go around. Let me just give you some recipies to bake your own pies. Think about Inventory Optimization, Facility Location, Cross-docking solutions, Public library collection development, manufacturing optimization, employee scheduling, airline operations, design of airports/trainstations/infrastructures/public transit/cities, distribution of newspapers/fruits/vegetables, global logistics and supply chains, hospitals, health care services, and the list can go on and on and on and on… just take a look at scienceofbetter.org
Now take those ideas, and apply it to the masses. You’ve got a problem, you’ve got the tools, and you’ve got the solutions in Academia.
Unfortunately, most of the OR knowledge is tied up in Academia. That needs to change.
First and foremost, most will agree that Academia should stop accepting papers that don’t open-source their code, since one of the main pilars of Academia is that a paper should be reproducable. That also filters out the academics to pursue academics for the wrong reasons (the select few that do it so that they can raise their “reputation” and then keep it a secret, and then try private consulting to make money). Here’s an interesting discussion between OR professionals. It’s time for Hackers to mingle with the ORites.
I’m not laying out what should be done exactly, but what I hope to achieve is that you’ll be thinking about this differently.
On The Next Generation Start-ups
Everyone wants to be the next Facebook. Facebook has been succesful (although you may disagree, but in the grand scheme of things they are), as have all the other big business to consumer ventures, making our lives more convenient. Most of the ideas I heard at Startup Weekend were in the paradigm of Business to Consumer. They try to be the XX of YY; e.g. 99designs of journalism — which I hope some day someone will make, cause that’ll help my wife. She is writing a book and freelances on the side. The only way to pitch story ideas is by 1) connections or 2) e-mailing editors cold (hoping that they are in a good mood) or 3) blast a e-mail on the J-school listserv and hope for a reply/referral. It pains me to see her do that. It’s a stressful process. A happy wife, a happy life — a colleague told me yesterday. If you do take the idea, call it Writific
To come back to the point, the field of B2C is saturated. The best people have brought it to 80% perfection already. Let’s refocus our new generation of startups to something bigger, rather than competing with these boys.
Thankfully, the best stuff coming out of Silicon Valley are hacker to hacker these days. They are doing some really good stuff, because it makes it easier for people like myself to get started and launch a startup. Good work on that, you’ve paved the way to the next revolutionary trend. Now it’s time to stop competing with each other trying to be the next big cloud provider, because hacker to hacker is getting saturated as well.
The new trend is going to be Operations Research 2 Business (OR2B). Now that we’ve got the startup tools and decades worth of OR papers, let’s apply them.
I’m not necessarily talking about Business 2 Business start-ups — that are technically a subset of OR — focussing on Data mining to predict you’re pregnant before you even know it, so that they can advertise cribs and strollers — or other tools that will allow the corporate evil to trick the people out of their wealth. Casinos are deploying massive Data Mining algorithms to predict who are susceptible to addiction, and send them free flights/resorts.
That just makes me sad. I’m talking about optimizing NP-class problems, where the real value is created.
In the start-up scene, I can’t think of anyone doing OR2B (if you do, please let me know, I’d like to connect). We’d like to see ourselves as the pioneers, and we want you to take a ride with us, and truly innovate when it really matters.
Here’s a project that I’ve paved the way for already, which is ship scheduling with speed decisions. I think it will have the most immediate impact on this planet if executed correctly, by the right people, for the right reasons. Those gigantic ships gulp a lot of bunker fuel. Making that industry a little more efficient will have tremendous impacts.
Here’s my thesis paper: Tramp Ship Scheduling with Speed Decisions. Forgive the unreadability, I suppose Academia’s language evolved in such way to keep outsiders from knowing what is going on?
It was rejected by INFORMS and I was disillusioned for some time, but I realized that I could do more with this. I could apply it to the real world.
I quit my cushy job and life in Hong Kong as a stock trader in the IFC, and moved to the Chinese country side for 8 months, the first 3 to work on this paper. We heard pigs being slaughtered every morning and chickens shared the road with cars. The air was not always the cleanest because of all the factories sprouting up across the county we were living in…and the only way to stay healthy was to hike up to the mountain every so often and do some Tai Chi. The living room had no TV, but a HUGE whiteboard and a good sound system embracing the books on the shelf. (hint: China is the epitome of waste, and could use some OR)
I think the people at INFORMS are focusing on the wrong things. I received a courteous rejection letter and that was the end of it. Rightly so, since they found an error in one of the equations. However, they missed the chance to encourage improvement and collaboration.
INFORMS, you’re all about connecting OR to business. Now is the time for you to prove it. You’ve got your business network, you’ve got the brightest minds, you’ve got the infrastructure, all you need to do, is change your focus.
Let Us Unite, and Help Our Planet, Turn a Little More Efficiently
Your current mantra seems to be:
The discipline of applying advanced analytical methods to help make better decisions
Nobody except for ORites in academia knows what we are talking about. I’ve killed conversations quoting the above. Plenty of executives have slammed on me during sales calls, the moment I used the above to explain what we do. Businesses don’t understand it; which is why most businesses associate “advanced analytics” with Excel spreadsheets.
We need to start building that important bridge between OR and Business. And not just for the large corporations, but for the masses. It’s time to disrupt the industries.
Paul Graham — you’re my idol. You were the reason why I quit my job, because my dear friend started sending me your essays. I love the inspiration that you are giving to the startup community, but let’s talk about your challenge to kill Hollywood. How did you go about forming that idea?
Two weeks ago, I went with my wife to see Dark Knight Rises. We had a romantic night — one among many visits to the theaters.
Why do you want to disrupt that? What’s in it for anyone? We’re happy the way Hollywood is providing us with top-notch entertainment, creativity and inspiration.
Instead, I would challenge everyone to focus on disrupting the Logistics industry, because it will help the planet, turn a little more efficiently. And yes, you’re not trading off any of the other perks of start-ups. If you need the money, because you need to take care of your family or go on to do other great things — the Logistics industry is a huge one. Business owners concerned with the bottom-line — yes, you will increase your profits too. Everyone wins.
- Pick a known problem (something that enterprise OR systems have proven ROI for already)
- Study the known solutions (understanding only 20% of a paper is good enough)
- Make it simpler, because the masses don’t need it to be that advanced (one professor told me that there is a 20 year gap between Academia and Best Business Practices)
- Spread the word — it’s an easy sales game, because you don’t need to go corporate
- Go directly to the users, who can then see the benefits immediatly, corporate doesn’t even need to know about it
- Open-source it (if you cringe at that, you’re in for the wrong reasons — fyi, Open-VRP is the engine of Routific)
Let me just quickly plug in that I did not come to this formula myself. It was the result of all the people who have helped me along the way. I am not going to name them here, because they know who they are, and this message goes out to them. These people helped me, because they like helping people. They mean the most to me, and an acknowledgement is more powerful when they are anonymous. So Thank you.
Don’t like it?
VCs are probably thinking, this guy has no business mindset. What I have is a different kind of mindset — one that believes we can make a buck and help the world.
If any of the above struck the wrong cord with you, I challenge you to take a look in the mirror and ask yourself: “Why am I offended by this. Is there a conflict of interest going on here? What drives me in my job? What is my purpose in life? .. How is it possible, that a young man with big dreams is giving away the next big start up idea, how is it possible that while this is obviously a great cause, why is it that I’m getting emotionally stirred in the wrong way?” If you’re still angry, you might want to look for inspiration in the right places. Books written by late Stephen Covey or the wise Clayton M. Christensen are a good entry point.
ORites are going to be the power of the future, but they can’t do it themselves, we need to leverage the power of the startup hubs. Organizations like Startup Weekend and Growlabs and Launch Academy, and all the volunteers there — that’s what we need. ORites, don’t be scared, they’re a hell lot of fun!
I’m taking a big risk, but I feel I am on a mission. Anyone with this epiphany would have done the same. The movement is not mine. Since we’re so young, it’s a good time to align the higher purpose, before it’s too late and toxic minds/incentives are involved. I’m laying this out that as a mandate. It’s recorded on the internet with a time-stamp, and will never decay.
An epiphany, that does not belong to me, but to us all.
Enough said, no time to waste.
Let Us Unite, and Help Our Planet, Turn a Little More Efficiently