#StartupsEverywhere profile: Mikel Carmenes Cavia, Co-Founder & VP of Engineering, Onfleet
This profile is part of #StartupsEverywhere, an ongoing series highlighting startup leaders in ecosystems across the country. This interview has been edited for length, content, and clarity.
Streamlining Last Mile Delivery Operations Across the Globe
Onfleet is a tech startup that uses logistics management software and route optimization to power last mile delivery services for thousands of companies across a wide range of industries. We recently spoke with Mikel Carmenes Cavia—Onfleet’s Co-Founder and VP of Engineering—to learn more about his company’s work optimizing last mile delivery operations, policy concerns related to the legal delivery of cannabis, and how a European court decision last year invalidating the EU-U.S. Privacy Shield has impacted their business.
What in your background led you to co-found Onfleet?
Before starting Onfleet, my co-founders and I spent about two years developing a company called Addy with a vision to solve the most stubborn geospatial problems in last mile logistics for emerging markets. Having spent my high school years living in Dubai—where I struggled regularly with poor delivery experiences, as many in the developing world do—I quickly realized that software solutions were needed to work around highly dysfunctional street addressing systems (as did my co-founder, Khaled Naim.)
The experience of launching and iterating on Addy helped us realize that to make a significant difference for these delivery providers and recipients around the world, we needed to build a high-level solution—one that would integrate delivery management, communications, route optimization, and analytics. With this intuition, we pivoted from Addy to solve a much broader set of challenges in the last mile. That is how Onfleet was born.
Can you tell us more about Onfleet and how you’re using logistics management software to help companies optimize their last mile delivery services? Where do you operate?
Onfleet is an end-to-end logistics management product used by thousands of companies globally to manage, analyze, and optimize their last mile delivery operations. The vision for our company is to build the operating system for last mile delivery. Some of our product's features include native driver apps, compliant SMS and voice communications, live recipient tracking, route optimization, ETAs, analytics, and SDKs. Over two-thirds of our team is based in the U.S. Our customers are located around the world, especially in North America and Western Europe.
How has the pandemic affected Onfleet and the companies that you work with, and what can policymakers do to better support startups at this time?
The pandemic has resulted in a significant increase in delivery volume for most of our customers. While companies in certain verticals have had to shut down completely, as a whole, the delivery space has experienced tremendous growth as consumers have chosen the safety and convenience of getting goods delivered to their homes. As a company, we were able to navigate the storm that was the early months of the pandemic thanks to the Paycheck Protection Program (PPP). We strongly believe that more should be done to ensure that additional financial relief is provided to small businesses in need. Beyond the pandemic, we would like to see immigration reform passed, in addition to tax incentives for startups to implement climate change-related initiatives.
Last year, the European Court of Justice struck down the EU-U.S. Privacy Shield. How did this decision impact Onfleet’s operations, and what should policymakers focus on as they work to formalize a new data transfer pact?
The European Court of Justice’s Schrems II decision invalidating the EU-U.S. Privacy Shield was catastrophic for our company. As an American company with a large number of EU-based customers, we were forced to make major investments in building out a cloud environment within the EU. The many complex tasks this change forced on us remain underway. The unexpected difficulty of having to prioritize such a major change to our systems has been very costly to Onfleet and we have regrettably lost prospects and customers as a result.
We believe that policymakers should immediately engage with their EU counterparts to work towards reinstating the program. This approach will better ensure that long-lasting changes are made to federal data privacy and security positions (up to the national security level) so small businesses can count on programs such as Privacy Shield for years to come, no matter who is in charge. The International Trade Administration (ITA) and related federal agencies should also be proactive in working with Canada, the U.K., and other important jurisdictions so we can stay ahead of their data processing concerns.
Onfleet is used to facilitate a really wide variety of goods, including prescription drugs and cannabis. Are there policy conversations related to those goods (like medical privacy or cannabis registration) that you track?
As a company, we facilitate the software-based management of legal and compliant delivery of medical and recreational cannabis in Canada and some U.S. states. This is a fast growing industry that we have worked with for many years, and Onfleet is widely believed to be a dominant player in the space. Recently, we have started to experience issues with the processing of SMS traffic being sent by U.S.-based cannabis customers through our primary communications provider, Twilio. While we are hard at work to ensure that we do not violate any carrier-imposed content restrictions, we believe that the Federal Communications Commission must get involved to ensure the smooth delivery of these important notifications by the carriers.
Of most concern to us are examples where recipients of cannabis notifications are having messages from non-cannabis businesses filtered—possibly preventing these individuals from being notified of other critical deliveries such as prescription drugs or COVID-19 tests. We also have deep concerns about changes recently made by carriers (claiming to be focused on spam prevention) that prevent the use of dedicated shortcode numbers for the processing of notifications related to our customers' deliveries.
What are some of the startup-related policy issues and concerns that you believe should receive more attention from local, state, and federal policymakers?
Cannabis telecommunications and payments: while it is a hard problem for us to comply with all existing regulation on the telecommunications and law enforcement data retention compliance fronts, it is even harder for our cannabis customers to pay and get paid.
Tax credits for low-emission delivery fleets: too many of our larger customers with in-house fleets feel that current incentives are insufficient to be able to afford building the fleet of the future.
Immigration reform: in addition to my own personal immigration story, it continues to be extremely challenging for us to hire the best talent in the U.S. because of dated immigration laws that greatly favor large companies.
Federal data privacy regulations (similar to CCPA): as a small technology company, we need certainty when it comes to privacy laws and a nationwide standard would go a long way to helping us build privacy into our products in a way that is consistent and future-proof
Tax code changes for more favorable treatment of small startup employee stock: QSBS should be modernized to allow for preferential treatment starting at 3 years if the company meets an expanded set of criteria, similar improvements should be considered for ISO/NSO to incentivize working for startups over FANGs
Improved federal consumer protection: beyond financial services and medical insurance, American consumers have low levels of consumer protection compared to other Western developed countries, we believe that a new agency should exist at the federal level to keep big business in check while helping millions of consumers and small companies
Permanent solution to law enforcement abuses against end-to-end encryption: we believe that end-to-end encryption should be legislated in and recognized as a right so that disputes and abuses can be permanently settled, something critical for privacy-centric companies who today are uncertain as to whether a backdoor will be one day mandated.
What is your goal for Onfleet moving forward?
We want to build the world's leading solution for every retailer to offer fast, affordable, and delightful delivery to their customers while also making Onfleet the best place to work for our team members in the U.S. and around the world.
All of the information in this profile was accurate at the date and time of publication.
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