I am currently based in Cape Town, where I often marvel at the gigantic container ships floating idly just off the coast of the city.

A few weeks ago, I listened to a fantastic episode of Invest Like the Best with Flexport's Ryan Peterson. In that episode, I was introduced to a book called The Box, on the history of the shipping container and containerization. And then the following week, a container ship blocked the Suez Canal causing billions of dollars in disruptions to global trade.

I'm in a rabbit hole.

What so intrigues me about containerization - apart from its massive economic impact - is that the container box itself required, and compelled logistics companies to adopt, entirely new processes and business models.

The Box tells the story, and the genius, of "The Father of Containerization",

Malcom McLean's fundamental insight, commmonplace today but quite radical in the 1950s, was that the shipping industry's business was moving cargo, not sailing ships. That insight led him to a concept of containerization quite different from anything that had come before. McLean understood that reducing the cost of shipping goods required not just a metal box but an entire new way of handling freight. Every part of the system - ports, ships, cranes, storage facilities, trucks, trains, and the operation of the shippers themselves - would have to change.

A few months ago, I wrote about form versus function, and new business models uniquely enabled by digitization (and innovation). But it's not a novel concept - 70 years before we had uberization we had containerization!

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An evolving narrative

Back in season one of the podcast, we published an episode on distribution. It was primarily an exploration of distribution at the last-mile. But we ought to have explored logistics from a long-haul perspective, and we will undoubtedly do so in future seasons of the show.

The disproportionately high cost of logistics has downstream effects on the cost of goods.

While Africa-focused fintech is a hot investment category, I think advancements in payments and digital commerce are incomplete without a commensurate focus on logistics.

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Thanks for reading,

Justin