Antonis Malaxianakis, Harbor Lab: Navigating the shipping industry with the support of major international funds

Panagiotis: Antonis, good evening. Antonis: Good evening Panagiotis. Panagiotis: Thank you very much for being with us. Antonis: Thank you very much for inviting me. Panagiotis: We've known each other for many years; we've been at university together. Antonis: Right. Panagiotis: I feel that I have with me first of all a friend and then a founder, an Endeavor Entrepreneur of a very great story. Antonis: Thank you very much for inviting me. I think it's well known that wherever I go or might be, I talk about Endeavor. I'm a big fan. Panagiotis: Do you want to start and tell us, in two or three sentences, what does Harbor Lab do? Antonis: Consider that a car goes to a car park and the car park has a different pricing policy for each floor, a different pricing policy for each space on each floor and a different pricing policy again, depending on the size of the car and how many passengers are in it. The same is true for ships when they go to ports. Panagiotis: Okay. Antonis: This is the problem that Harbor Lab solves. Panagiotis: I look forward to hearing more and how this has all played out. It's in a space where you should expect Greece to start creating even more success stories, right? Because Greek shipping is world class. Antonis: Right. We are, if not the biggest, one of the biggest powers in the world. We hope to become the Silicon Valley of Maritime Tech here in Athens. Panagiotis: And if this, that we should become a Silicon Valley, sounds a bit romantic and even utopian, perhaps it is the only example that is probably realistic. That is, we can indeed become Silicon Valley. Antonis: It really is, because the market is here. It is in Athens. That is literally half an hour by car wherever you go. Panagiotis: Yes, yes. Antonis: Which is not the case in other industries. 25% of the world market is here in Athens. Panagiotis: But let’s start first with you. Tell us a little bit about where you were born, where you grew up. Antonis: I grew up in Athens. I am the third child in the family. My sisters are 11 and 12 years older than I am. I guess I was, you know... Oh, what happened now, by mistake. But I was lucky because I grew up partly as an only child, so I had, you know, the full attention of my mother, if you like. But at the same time I also had the advantage of having two sisters, which paved the way for me to start going out at a younger age. Panagiotis: And I know that entrepreneurship is very much in the family. Dad's a businessman. But are the sisters involved in entrepreneurship at all? Antonis: That's right, they have taken over the family business, Design Pergola, selling outdoor furniture and pergolas. My father died when I was in my first year of university, so I had to join the family business to support my mother. I was CEO from 2005 to 2013. Panagiotis: What's it like to be a CEO at 18? It's a bit... It sounds like quite a lot....it has challenges. Antonis: It is aggressive enough for a child. On the other hand, it also put me in a slightly different way of thinking from a very young age. We also had a strong... how shall I say it... you know, my father died when I was 18, but he was sick since I was 12, so there was a kind of survivor instinct. So I was able to cope with the problems. I obviously had a lot of support from both my sisters and my mother. It wasn't easy, but it was a one-way street. There was no other way. So, anyone who knows me, you know, if you ask my friends what Antonis is, they'll tell you Antonis is a hustler. So that was the way I managed to survive. Panagiotis: I'm going to assume you're also studying while you're a CEO? Antonis: That's right, not terribly diligent as a student, nor as a learner. However, I was studying at the same time, I will tell you that I took it seriously towards the end, in my fourth year, that's why I was late to graduate. I finished my studies in five years. Panagiotis: Five years? Okay. Antonis: But in four years I was very strong, I had passed four courses. Panagiotis: Four courses in four years. Antonis: One course a year, just for luck. Panagiotis: What do you remember from that time? Are there things and experiences that you gained during that time that play a role today in your journey as a founder and CEO? Antonis: A lot. In 2008 I remember with the shop, probably the best year we had in the company, I remember getting up at four o'clock in the morning. I used to go to the Factory, we were going at that time, we were loading the trucks, the trucks were going to make the deliveries, then I'd go to the shop, open the shop, work till the afternoon, then in the afternoon we'd go back to the Factory to look at the new deliveries, be ready for the next day in the morning. Sometimes, because I was very young, I would go out, go to the club and then go straight to work again. It's hard to say this, but it's sometimes so hard to be a founder, there are so many adversities that you face every day, that if you don't have the strength to swim against the tide, you're not going to make it. Panagiotis: You finish your studies, get a degree in five years and then what happens? Antonis: I'm going into the army by necessity. While I was in the army, I started thinking about what I really wanted to do and that was, you know, a difficult time for me because, you identify with what you're doing and it's very difficult if you want to let go of the idea that, you know, I'm going to continue what my father wanted me to do. Panagiotis: Did he want it, did he want you to be involved in the family business? Antonis: Yes, it was perfectly clear. I wanted to be a director. While Mom was a housewife, she was very ambitious in the family and she was also the one who always wanted us to go the extra mile. So as a kid, instead of, you know, reading books about Harry Potter and Lord of the Rings, she was reading books to me about Onassis, about Niarchos; of course she was skipping a lot of the history. But it was always, you know... when I was five years old and they asked me what do you want to be when you grow up, all the kids said football player, but I used to say a shipowner. Practically speaking, because there are always two sides to a story. There is the romantic part, but there is also the practical part. On the practical side, because I wanted to live in Greece and I didn't want to leave, it was the only industry where if I managed to do well, I could ensure a good standard of living for myself and my family. Panagiotis: So, you're in the army, you're trying to figure out what you're going to do and shipping is very high on your mind. What are you doing about it? Antonis: Finishing my military service, sending out 250-280 CVs or so. Every email address I could find of a shipping company, I had sent my CV. I got no answer! It was also a very strange CV to be honest. Who would believe that a kid has been working since the age of 18 and so on. Panagiotis: That’s a pity, I would say! Antonis: It's a difficult profile. Panagiotis: If I got the same CV, the first call I'd make would be you, but... Antonis: Well, it didn't work out that way, unfortunately and fortunately. So I stayed in the family business. One day I was serving a lady, a great lady, and when I sold her an umbrella and I was writing the receipt I asked what's your name and she said Eleni Martinou. I asked her what her relationship was with the Martinos family. She told me “I'm one of them”. And I said to her: here's the receipt and here's my CV. Panagiotis: It's a terrible coincidence, isn't it? This person appeared after you sent 280 CVs. No one has responded and there is one of these families, one of the strongest families, one of the most prominent families, and they make you an offer to come and work for the company as an intern. Antonis: Right. Panagiotis: The question that comes to me a bit spontaneously here is would you go even without money to work for them? Antonis: Without a second thought. It was a great time, because I can't hide the fact that the experience of being in the family business leaves a mark. It's not that everything is ideal. Those were difficult years. So it was a little bit more carefree in the beginning, because there weren’t as many responsibilities. However, you know, I followed my heart; I wanted to move on, you know, I wanted to move on quickly. I'm not known for my patience. And in the first month they offered me to stay permanently and since then I moved to the disbursements department, which is the problem that Harbor is solving now. And that was one of the things that, I mean, in the future it was a driving force to be able to help the people who are doing the work that I was doing at that time, so that they would start to get involved with the interesting part of the work and leave the admin part of the work to me. That was, let's say, something that I was very keen to do. Just think that globally in shipping, a person is needed per eight ships in our business if you are doing everything manually. Through Harbor Lab you need just one person per 50 ships, because the entire admin part is taken away, there is no need to do it. Panagiotis: While shipping is so prominent and big in Greece, we don't know how it works; and what you're telling us now about the expenses and the purchases to be made and the deals entered into in every port, all these things are new. Help us to understand a little bit how the market works. As I understand there is a person from the shipping company per eight ships managing the agreements to be made and the ship at the port and on the other hand, there is a person at each port coordinating this work. Antonis: There are hundreds of agents at every port. Just think that there are currently more than 4,000 registered agents worldwide in Harbor Lab. Panagiotis: Okay. Antonis: If you want, the agent is essentially the eyes of the office at the port. That is, the agent gives us information about what happens on the ship when it arrives at the port. Panagiotis: And mediates between the suppliers and the ship? Antonis: They are two different players in the equation. One is the shipping company that manages the ships and the other is the agent. The agent sends you an estimation of the costs, the shipping company has to negotiate it, make the consolidation, the admin and so on for the proforma; the company has to negotiate the costs which are negotiable, put pressure if you like on some other things, some costs which may not be there because, you know, these things happen and that's where the shipping company essentially saves money. Panagiotis: I can think of two expenses for a ship at the port, oil and the rental of space. What does it do? What purchases are made there? Antonis: Well, oil is another part of the job. It is the biggest expense of a shipping company. Just to give you an idea, each ship spends about $3 million a year on oil and $2.2 million a year on our expenses, which is the disbursement part. So what are disbursements? It is divided into three broad categories. The first one is the so-called port dues, as we say in shipping, which are the tugboats, the pilots, the port dues, that is, the lighthouse dues, those kinds of costs. The second part is the agent's expenses, basically paying the agent and the third part is what's called owners expenses, which are expenses that are related to the ship, like crew changes, like getting the parts on board, the launches, all that part, where people stay to go on board, where they stay when they come off, customs for the airport, all that part. Panagiotis: Supplies I guess, sure. Antonis: Yes, this whole part belongs to disbursements. Panagiotis: Okay, and it comes to almost the same cost as oil. It's a huge amount. Antonis: Right. I was lucky at Thenamaris because the CEO at the time was Giannis Martinos, who founded Signal afterwards. He had a very different vision for shipping which he had passed on to us allo, who joined Thenamaris as new employees and he got us to think a little bit differently, so one of the first questions he asked me when I met him was what would you change and he asked me that question very quickly. I think that since then we've had a good chemistry and he became the first investor in Harbor Lab after that, so... Panagiotis: Of course, he's also a member of the Endeavor Board of Directors and a fantastic person. I guess then the next step is entrepreneurship, right? Antonis: No. I stayed with Thenamaris for 4.5 years, which for my level of patience means decades. After 4.5 years I had completed my circle; I wanted more responsibilities and I moved to the StarBulk group which is listed on the stock exchange so I saw, you know, those problems again. I tried to search the market for what is available so that I could use it in the company. I had no intention at that time of doing something on my own. I was getting ready to get married at that time so nothing had crossed my mind about something new. Nevertheless, I saw the competition. There was basically no company providing software as a service so that I could get it and use it in my world. Basically there were then and still are two companies that are now competitors, if you like, partly of Harbor Lab, who solve the problem with manual resources in India. So it was quite different from what I wanted to do and where I could see that there was value. However, because I didn't have any alternatives I gave our current competitors a chance; we introduced a pilot, we checked the invoices, we found a lot of mistakes and that was the moment when I said this is it. Panagiotis: This is the start. Antonis: And I'm starting it tomorrow. Panagiotis: So you quit and start. Antonis: I didn't quit. Initially I went and asked for my wife's blessing because I knew that once I got involved I was going to get into a lot of trouble and I put it all down on paper in the beginning; I actually drew the first screens of the software, how I wanted it to actually look to the user. I started like that, then I hired a part-time software designer, and we made the first prototypes. I started showing them to friends and acquaintances in the industry who are involved in the disbursements part. The feedback was, you know, very, very nice. I gave my resignation then; 31/12 of 2019 was basically my last day at work. I officially started at Harbor Lab on the first of January, 2020. We release the prototype, the MVP of Harbor Lab on March 10, 2020 and two days later we close down with COVID. Panagiotis: I think that in the end we're going to write it down as something very positive because... Antonis: Now I agree, then no. Panagiotis: It was that terrible slap that hammered resilience and receptivity to another level. Antonis: COVID if you like accelerated the need for some shipping companies to be able to digitize their processes. So in 2020 we managed to have 220 ships using our platform. Panagiotis: These 200 ships were Greek? Where were they from? Antonis: All. All Greek ships. Panagiotis: Great. Antonis: Great. I, as Antonis, have no complaints against Greek shipping. It really embraced me and supported me through the difficult times. They bought a little bit more ot the dream and they bought a little bit more of my story and what I wanted to bring to the industry. So no complaints. Just think that the company was established on May 2, 2021 and in the first month of the company's operation we had a revenue of 50,000$. And then we slowly decided to go into the process of fundraising. Panagiotis: For the first time. Antonis: For the first time, that's right. Panagiotis: Until then, what is your funding source? Antonis: With Angel Investors from the Industry, with a bigger ticket if you like for Giannis, with whom we had worked together in Thenamaris. Panagiotis: So you've raised funds first from some Angel Investors, the first anyway very traditional step for a startup to get the first funding, two, three, four cases to be people who can, understand and can put up the first money and take a lot of risk. Antonis: And people of the industry to us. That was also very important. Because they knew the magnitude of the problem we were trying to solve. Because the more traditional venture capital if you like hadn't seen success stories in shipping and it was a difficult industry to get into. So it took a little bit of training on our part, if you like, on how big the market is, why the opportunity is big and so on. Panagiotis: But armed with very good angel investors, and a very good first track record that we have reached 50,000 monthly income, 200 ships, you try to raise money from institutional investors. Antonis: Right. Panagiotis: Tell us a little bit about this experience. Antonis: Nice experience, no complaints, we were lucky here. We were just before the market boom if you like. So 2021 was a very good year to raise funding. Panagiotis: Really. Antonis: And we started, of course, in November and it was completed in March. Giannis and Giannis' team carried out introductions to several VCs and that's where I met Apostolos Apostolakis, love at first sight, and while he was the third in line to give us the term sheet he was the first in our heart, so we decided to work with Apostolos. And at the same time, it was a big round, that is, we raised 6.1 million euros in a seed round, which is the largest in the history of maritime tech. It was co-leading along with Speed Invest. Panagiotis: It is a very, very, very, very, very successful fundraising. What are the first messages you get from your team, from the market, from yourself? Antonis: In the phase where the startup burns money every month there is an expiration date. This creates a lot of stress to both the guys working in a startup and the founder. So you know, it's a great opportunity to take a breather and then refocus on the goal and be able to proceed to execute. Panagiotis: We moved the expiration date down a few years, but at the same time we're going to increase spending, push for growth, hire, open markets, and the expiration date is coming up again. What were the main changes that came with this seed round? I'm going to stick with the seed round, although there were bigger and more successful rounds, because it's a record breaking seed round and I am just wondering what were the impacts, both positive and negative. Antonis: I'll tell you, something that was very positive for us, because it got quite a lot of exposure, because of the amount; we started receiving CVs that we didn't receive before: CVs from people who were senior, who started reading about us, started believing in the idea, they understood that we would always be a Greek company if you wish, but in an international business environment. But the headquarters will always be in Greece because as we said the biggest share of the market is here. So it helped us a lot in being able to do good recruitment, to bring in developers to help us build the software the way we dreamed of and I think I'll say that the biggest part of the investment went into that. It went to the technological part, the team part. Panagiotis: To the team and technology. Antonis: I think we went from eight people to forty in eight months. Panagiotis: And suddenly another door opened up, with a million problems hidden behind it, which is called team management, leadership, issues within teams, structures. Antonis: A mess. This is probably the most difficult part of the job and it remains, I can assure you, the most difficult part of the job. My approach was very romantic. You know, we're all a family here; and if someone says this thing to me, I would shudder.. It was utopian. Still, you know, we grew up, we learned, we suffered and we learned. The company is growing so fast that you have to be constantly alert and learning to grow with it. If the company grows faster than you grow, then you stop being the right person to run that company. And Apostolos helped me very much in being able to guide me in, you know, what I should read, what stimuli I should get. He brought me in contact with Alex Chatzieleftheriou, so I started, you know, sharing some concerns with him, things and problems that I was facing at that time; he had already faced them. So, it put me in a process of being able to search and find people in the ecosystem, such as, for example, Endeavor and I built a network of people where we basically act as each other's support system. Panagiotis: What are the things that you find that a successful founder of a seed stage startup needs to bring with them to make sure that, I like what you're saying, they grow at the same rate, if not more than the rate at which their company grows? Antonis: Look, it's very different depending on the character of each person. What was a bit difficult for me, if you like, because my character is like that, was to be able to share the work with others. That is, I was trying to do everything myself. It's exhausting and that's why at some point in the beginning of Harbor Lab, early 2021, I got burned out and that's why I had to change my work habits a little bit, if you like. My coaches and mentors have been telling me for a very long time that this path you have chosen will not work out well for you. That's when I realized that I had to take a little more care of myself, to take a little more care of Antonis. I started exercising again after a long intermission because I've always done sports. That helped me a lot in my everyday life but also as a person, if you like; sometimes I have too much energy and has to come out somewhere. It was a difficult period. Panagiotis: Okay. I really like what you're saying because it does have to be one of the founder's goals to leave their company unscathed by what they're experiencing and that's great and I love that we're slowly adding other players to the support system of a founder. It can be psychoanalysis, it can be a person who helps us to fix our diet, to have a personal trainer. What are the things that are starting to contribute to the growth that the investors are expecting? Antonis: When I started, I had the utopia that, you know, and I was saying it, here we are a family. It was a very nice and big lesson for me to learn that here we are not a family but we are a team and we are a team that wants to go and lift the Champions League trophy. To be able to lift the Champions League trophy we need the best player in all positions. That's the mentality. And that was a very big culture change. When that happened, that change in the culture, I can honestly tell you that many of the guys that have been with me since the beginning decided to leave. It was the Great Resignation period, as they say, just after COVID was over. It was the time we started Harbor Lab 2.0. The first thing I decided we have to do was to get a corporate identity, to understand who we are and who we want to be when we grow up. Then we went through the process of bringing in people who could take us up to Series A; people with a different profile from the one of the pre-seed, people who were more experienced, who had been through this stage before, who had done it before and done it successfully before. My own personal bet, If you want, was the hardest part of shipping and our company, which is the sales part; to be able to grow the company so fast that we would be ready within the next two years for Series A. That meant that we had to double and triple the turnover year after year. We managed to do that two years in a row and it was the main part that led us to Series A, if you like. Panagiotis: There's this fantastic growth rate, new partnerships, I guess a lot of companies coming in as new customers. How many ships now just before Series A? Antonis: There are five hundred ships that are paying and another thousand that have now been on-board. We are now past Series A, we have reached the number of one thousand five hundred ships which are paying for the platform. Panagiotis: And just before you start the new round of funding, what is your turnover? Antonis: I'm at 1.5... 1 million 700 thousand euros. Panagiotis: Your Series A was oversubscribed with capital letters and a space in each letter. And a fund like Atomico comes in for the first time. I have to say that it's a very, very, very big success that shows what all of you have built, what you have built. Antonis: Thank you very much. Yes, in this round of funding we were indeed over-subscribed as well. so again we had the luck if you want to choose which people to work with; this is very important for startups and very important for founders, because these are the people who support the board of directors if you want to. And with Atomicom it was a very competitive process, it was so competitive! You know when you're in the final stage you have, if you like, a type of interview with the whole investment committee of each fund so that the partners can collectively decide whether to invest in the company or not. The round was so competitive because we had received other term sheets and this was done on a Sunday. It was done on a Sunday. Just the fact that it was on a Sunday told me a lot about the level of commitment of this company to Harbor Lab. Panagiotis: Give us a bit of the technical specifications. Antonis: We raised 15 million euros, that's the exact amount. Atomico is participating in Series A. Panagiotis: And they are the lead investor. Antonis: That's right, Notion Capital, which in a previous round had led, Venture Friends, Speedinvest, Endeavor Catalyst and TMV which is a maritime VC in New York. Panagiotis: And the Lead Investor, let's say, to share a little bit of terminology, is an investor who takes the responsibility first of all to take the largest percentage of the round and put up the highest amount of money but also is responsible for the assessment of the company’s value at the time of raising the money. This means running an audit, a thorough audit, so, and so everyone else that follows usually follows that due diligence that this lead investor has performed. Antonis: Right. Panagiotis: And the fact that it's Atomico, makes it world class all around, because Atomico is one of the top performing funds and drivers in the European scene. We have every reason to believe that when a fund comes in and enters an ecosystem and invests in a company in a country, the only certainty is that that country is now under its radar. And the one thing that is certain is that it will have some kind of exposure in the next cases and we have every reason to believe that an investment and an investor coming into a country will bring more. What's the next bet? What is the bet that Atomico bought, what are the key next steps that you see for your company and for you? Antonis: Look, the important thing remains the big increase in the company's turnover in the coming years. This does not change. It's, if you like, the most important part for investors, top-tier investors, to be able to invest in a startup, is to grow revenue quickly. We said before that we were 40, now we are 80. Before Series B we estimate that we will be about 120 to 130 people. So the company again will go into a new phase, a new process. So the process for us to be able to grow accordingly as Harbor Lab grows is the same. It's a lot of personal effort and a lot of work for me and for the rest of the senior leadership guys. It's just that the lessons we're taking are different now. So from now on my big bet for me is to be able to have an organization with 120 people but as fast as we were when we were 20. This is a very, very big problem for startups because you see that the more people come in, the slower the organization becomes. Panagiotis: Well, we're going to play a game. Antonis: Okay. Panagiotis: Pick a card. You read the word and give us the terminology that you have in mind for that word. Antonis: Disruption. Disruption interruption. To be able to change the status quo and to be able to offer a different way of thinking and a different approach to solve a problem that many people are concerned about. Panagiotis: Disruption in the way you build your team, its culture, is that something you bring? Antonis: To be able to help people become better professionals we need to help people to be able to become better people or if not better people to grow as people. I'm trying to help people get into a process of wanting to grow up themselves. So this is a pretty disruptive process. I really believe in this thing. I've seen it work for me and I would like if a child has a problem... because you know in Greece going to a psychologist is a bit of taboo. Panagiotis: Of course it is. Antonis: And all this part is to help people do it. If you've got him right there, eventually something will trigger you to go. Panagiotis: I see a mindset that is very much ahead of its time. Now I understand why you have been chosen as a Great Place to Work three times. You have a very nice metric, a very large participation of women in the group, as it should be. Tell us a little bit about that. Antonis: Yeah, I think the last metric was that 52% of the company is women. It's not something we did on purpose. They were just the best. Panagiotis: I'd like you to tell me a little bit about a case of disruption which is very positive, and knowing you, I know that it has come your way. Very recently you've also become a dad. What is the founder like, a high growth startup who suddenly gets something else of high growth, a high growth kid with a tsunami of new stuff? Antonis: I think it's the only thing I can deal with and not think about Harbor Lab. Here you really feel that you have a responsibility to be able to put a good person out into society and to be able to teach them some basic things so that they can fight. Panagiotis: You've built a great company in Greece, you employ a lot of people in Greece, you live in Greece, you're raising a child in Greece. I'm wondering a little bit what are the dreams, what are the things you want to see happen in the country, what is your impression of where the tech innovation ecosystem, the economy of the country is going, what do you think is coming? Antonis: The tax reduction, for example, which has been passed and it's a very, very nice incentive if you like to bring people back from abroad. And this is also something that I'm very, very passionate about and I'm trying to bring back, if you like, my own generation, all my friends and acquaintances have left and gone abroad to live and work, we're trying to bring them back, it's very, very important to see them do things like that so that we can start to move forward. I would like here to make a comment about the fact that we gave a very nice and big incentive for the people who left, but somehow we have to reward the ones who stayed here during the crisis. Panagiotis: Rapid fire. Rapid questions to see if we have missed something from your personality. Good. So, book or podcast? Antonis: Book. Panagiotis: Morning or evening person? Antonis: Definitely evening. Panagiotis: Definitely evening. Coffee or tea? Antonis: Lots of coffee. Panagiotis: Coffee, good. Let’s see if we find a person in the season who would choose tea. Which historical figure would you like to have dinner with and why? Antonis: I would definitely like to have dinner with Aristotle Onassis. For so many reasons. As I said in the beginning, he's one of the people who was always there and was one of the romantic reasons why I wanted to get into the industry, both for the great work ethic he had and for his great lust for life. Panagiotis: What is your favorite city to travel to? Professionally or not. Antonis: I would say Copenhagen. It's a very nice city and it's one of the biggest, people don't know it, it's one of the biggest maritime hubs in Europe. Panagiotis: Oh okay, I would expect the Netherlands in Europe. Antonis: Right. Panagiotis: Good to know. Is there a book that changed your life? You talked before about the reading lists they give you from time to time. Antonis: It's definitely Five Dysfunctions of a Team, by Patrick Lencioni. We already had the pleasure, the consulting arm of Patrick Lencioni came to Greece for Harbor Lab and we did a 3 day offsite with all the senior leadership to look at our dysfunctions and how we can solve them. What is the best advice you have received? Antonis: Shut up and swim. Panagiotis: Shut up and swim. What do you think makes an entrepreneur outlier, what makes them stand out so much? Antonis: Having a relentless drive to pursue your goals. Not letting anything get in the way. Panagiotis: Antonis, thank you very much, it was a fantastic discussion. Antonis: Thank you, Panagiotis, for inviting me. Panagiotis: Good luck