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B2B Marketplace Interview: Moritz Claussen | Bowery Capital

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Michael Brown

March 10, 2022
Moritz 3 17

The Bowery Capital team is continuing our blog series covering B2B Marketplaces. We are doing deep dives on various companies, interviewing founders and investors, and learning what it takes to build success in the B2B Marketplace arena. This week, Moritz Claussen, Founder & Co-CEO of, answers some of our questions. You can read all of the posts in our series by going here.

Can you tell us a little bit about how works as a marketplace and who the typical buyers and sellers are?

We are a B2B marketplace where on one side we have airlines, and on the other side we have freight forwarders. The airlines essentially distribute their cargo capacity through and the freight forwarders - who are the buyers of that cargo - purchase capacity through our platform. In order to facilitate those purchases, we integrate into the airlines’ inventory management systems, which are called core cargo systems, to get access to price, capacity, and route information. This allows us to process inquiries from freight forwarders and then return multiple offers per airline - freight forwarders can then compare those offers, select one, and book it in real-time.

That is kind of the key strength of - the air cargo industry has historically worked via rate sheets and asynchronous flows of information, whether it's by telephone or email or whatever, and we are trying to move that forward to the 21st century. This has already been done on the consumer side where you see companies like Kayak and Skyscanner which offer a more synchronistic exchange of information and real-time booking capabilities.

What was the inspiration to launch

We didn’t focus upon air cargo in the beginning. Initially, we thought logistics was a very interesting space just because of the pure size and the archaicness of how parts of the industry operate. We got exposed to logistics through a couple of friends in 2015/2016 that co-founded Sennder here in Berlin and then Forto (which used to be FrieghtHub), which are both big digital freight forwarders. When we started exploring the industry, we quickly realized that we didn't want to build one of those Flexport-style operating businesses - we wanted to build a tech product.

So, we started to look at this industry from that point of view and started interviewing freight forwarders to understand what their role was. We then got introduced to Lufthansa Cargo and they were experimenting with a few ideas, and through that we started talking to our freight forwarders and quickly understood that they were sourcing all of their capacity through email or telephone channels - primarily via email. This meant sending blind copied emails to ten airlines, asking for flight plans, capacity, and rate information. Coming from the passenger experience, we thought that was ridiculous. As a passenger, you know that no matter who you are, you can go online, book a flight, know the price, know the capacity and all of that.

We thought that's a great place to build a marketplace - it’s fairly fragmented on the demand side, and while it’s not super fragmented on the supply side, it is fragmented enough that there is competition and it's essentially a commoditized product. Even better, it is a market in which there is chronic oversupply (this was prior to COVID). But with these dynamics, we saw a need for supply to reach demand and to do so effectively. And we essentially started the company on that premise.

When you were first kickstarting this marketplace, what were some effective methods you had for onboarding initial supply and demand?

I think it's often the chicken and egg problem in a B2B space. The demand side is pretty fragmented but the airline side is not so fragmented; there are about 300 global players on the airline side that play a role. Lufthansa invested in our Seed round and this gave us the ability to essentially lock in a strategic supply partner in Europe. For us, it was important to lock that supply in, but at the same time to make sure that we can operate independently as a third-party marketplace. We had to take a lot of governance measures and be very careful about how we did that, but it worked out. For subsequent airlines we onboarded, it is a partnership process to onboard them which can bring with it a longer sales cycle. For the demand side, we adopted a bottoms-up approach - we used a similar strategy as Slack or Dropbox where we didn't sell directly to the company. Instead, we sold to the individual because it was a free product for the demand side. This was deliberate as we didn’t want to constrain our growth there. Onboarding demand was very much about outbound sales - we would get the first user in a given office onboarded, and then would grow through referrals to their colleagues. I think in Europe, around half of our users still come through referrals which has been a big driver of growth. Interestingly though, the second largest driver for growth on the demand side is partner marketing; our partner airlines have an inherent interest in seeing cargo bookings flow through us - in particular, those that don’t have their own booking platforms; they share lead lists with us and help us acquire users which is a nice situation to be in.

Did monetize from Day One or was this something you turned on over time as the marketplace was able to build up some initial scale and liquidity?

We monetized from the start - we were very clear that we didn't want to build a marketplace without monetization. Our business model is to charge airlines a commission on the value of the shipment that we facilitate. This acts as a take rate on GMV. It was important for us to monetize early so we could be very clear in showing Series Seed and Series A investors the potential on the revenue side. We take a more liberal approach now because as a marketplace, it is a ‘winner takes most’ market, so now it is more about speed and not as much about revenue. So, we have more flexibility now on this but we wanted to establish monetization early. recently announced cargo.one360 - effectively a data product for the airline side of the market - how do you view these kinds of data products fitting into the wider marketplace strategy?

Yeah, it's interesting and I am not sure I have a perfect answer because I think we are still trying to figure it out. We are creating a market, we are creating a category, and with that comes a lot of education. What we realized is that it’s great to find the airlines that want to distribute their capacity digitally, but if they are still working out what they're doing, they can only go so far. And so very quickly we established what is called the airline growth team, who are essentially consultants helping our partner airlines understand the do’s and don’ts of selling in an online world. Much of this is driven by data. Data can be really helpful for airlines in tailoring their offerings so the forwarders are more likely to buy - this is something we have realized over the last few years. Now we are providing airlines not just their own sales data, but also giving them insights into marketplace dynamics and benchmarking. And now we are going even one step further and making platform data available to them as well, all in an effort to help them sell more effectively.

As a B2B marketplace, what metrics do you focus on to track the health of the business? Do you have one KPI that is your North Star or is it a more varied approach to assessing how things are going?

We look at GMV first - as long as you can keep growing GMV you are in a good place. But at a certain point, you also need to look at marketplace health and that’s best reflected by analyzing cohorts and their booking and search behavior. And then you can drill down into activity at a branch or user level, but essentially those are the type of metrics we look at. We also track churn on the cohort level with negative churn being the goal.

How did you develop the underlying technology for the marketplace? Obviously you had a technical co-founder in Mike, but were you using outsourced developers, no-code tools, or just coding it all yourself?

It’s all built in-house - we see ourselves as a technology company and I think we want to make sure that the core of the business is always being built in-house. That’s always going to be the approach - the first three hires at the company were engineers and the fourth one was a product manager. I think that is how we’ve always seen it and how we will continue to see it. But for elements like our data product cargo.one360, which is built on Looker, we can use agencies to help bring these together and be quicker on that, but when it comes to the core technology, that is all built in-house with our own team.

Are there any levers you found particularly effective for driving GMV?

One thing that we realized is that marketplace product-market fit is not as simple as just building an awesome product. A marketplace has a second challenge that a great SaaS product doesn’t need to deal with as much, which is supply and demand - liquidity in the marketplace. You can have the most amazing marketplace product, but if there is no supply, you will not have demand and vice versa. For us, it was very much about acquiring demand in the first place because that helped with acquiring airlines. Now the market has changed and it has become more about acquiring airlines to satisfy demand. And while product quality matters, and new product features and innovations can drive demand, the primary driver for growing demand has always been expanding supply on the platform.

Were there any folks that came before you, or companies that you had looked at, that had solved some of these problems that you can point to? I am curious where founders are learning and how they might learn from companies that came before them?

In our space, there was one company trying to solve what we are solving today, but like 20 years ago - they were just too early and the internet wasn’t ready to exchange information in real-time and all of that. We found it incredibly helpful to talk to other marketplaces - be it B2B or B2C. We have Carlos - the ex-CTO of Skyscanner - being an angel in the company. We had some connections to Spotify through some of our investors and spoke to them a ton. They have an interesting set-up with only three or four big labels, a very oligopoly-like structure on the supply side, which helped us a lot in understanding how our market might work. Primarily, we learned the most speaking to founders who built marketplaces either on the B2B or B2C side.

What is your advice for any B2B marketplace founder starting on their startup journey?

I think it always comes down to solving the chicken and egg problem. You need to understand whether you are demand constrained or supply constrained, and then find a smart way to circumvent that problem and I think that looks different for everyone. That's the big one to solve. And if you can solve that, then it's fun - but it's difficult building marketplaces. Building a SaaS product is probably much easier - so if you like easy problems, don’t do marketplaces.

If you liked “From The Front Lines: Moritz Claussen (” and want to read more content from the Bowery Capital Team, check out other relevant posts from the Bowery Capital Blog. Look out for more content on B2B Marketplaces from us in the coming weeks.

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