@jcmleng directionally, your graphic is correct - $WTC's strengths are in the middle of the diagram and E2Open's are at either end. But that is an over oversimplification.

I think, if anything, yesterday's investor call could lead you to take away that there is less overlap in the product offerings than is in fact the case. If they could have presented the chart in the way you have, then you could be sure they would have.

I think that further reinforces my point yesterday in the discussion with @Solvetheriddle. I think their strategy hitherto has been to build out the capability via smaller bolt-on/ tuck-in acquisitions. But as they have gotten further beyond their core in FF, they've realised it's not so easy, and therefore they have identified the need to get to critical mass across the supply chain management process more quickly, which E2Open certainly helps achieve. Again, there is my gut feel, rather than a view based on solid knowledge or analysis.

The world has NOT been sitting around while $WTC has been building Cargowise. In fact in the deep dive I did into global logistics software several years ago, and which I published on SM, I was amazed at just how many different solutions are competiing in each of the capability areas show in the slide.

Yesterday I got my BA to do a "deep research" on the product overlaps, and them to assess the relative strengths in tabular form. I've not checked it yet, but here it is unedited.

Generally speaking I think it has got many of the elements about right, as far as I understand them. Potentially it shows just how much capability has been acquired, probably shaving 5-10 years off $WTC's roadmap development. And for a pretty decent price too!

Personally, I don't think the market has realised potentially how transformational this deal it.

Table: Comparative Analysis of CargoWise/Wisetech Capabilities and E2Open

Source: ChatGPT4.0

@mikebrisy , many thanks again for your insights. Having subsequently listened and digested the e2Open call, have now formed the following view on the deal:

SUMMARY

1. The creation of this enhanced global supply chain and logistics multi-side marketplace is looking to be absolutely transformational for WTC - it accelerates and deepens WTC's capability to create a huge multi-sided market place across supply chain and logistics which connects all participants across the entire flow of goods. This is simply huge as it enables WTC to go from vision/concept to execution very quickly and imminently.
2. Given Richard’s comments on the size of each of the e2O acquired components, the approach WTC has and will take to digest the components, WTC’s deep experience and expertise in integration, am significantly more comfortable that WTC will effectively digest and integrate e2O, as they apply their experience and expertise from previous acquisitions.
3. My previous concerns around inherent e2O complexity should be restricted to the customer-end, 1 or 2 levels of detail away from the platform/module integration that WTC is likely to focus on, and the space that WTC would not likely play in - so, there is probably little, if any impact, on the overall integration risk profile.

The possibilities from hereon are seriously exciting and there is a lot to look forward to in the coming 1-3 years as the integration and benefits from it unfold, bit by bit!

WHAT HAS CHANGED IN HOW I THINK OF WTC

The key piece that you said all along, but which I did not internalise at all, is the WTC vision to “Be the operating system for logistics and trade”. I previously thought of this as being primarily freight-forwarding/CargoWise centric. The following comments in the call changed my view:

Half of the world’s international trade passes through logistics service providers like freight forwarders, while the other half is from importers and exporters dealing directly with major shipping lines.

• WTC has dominance in the 50% of world trade that passes through freight forwarders via CargoWise
• E2O now immediately opens up the other 50% which WTC has clear capability gaps in as its ecosystem includes (1) Major ocean carriers (2) Direct exporters (3) Direct importers (4) Shippers - instant access to a hell of a lot of connected network points ..

Accelerate and deepens WTC’s plans to create a multi-sided marketplace, connecting asset-based carriers, logistic providers, importers, exporters, shippers and many other supply chain and logistics participants 

The “multi-sided marketplace” was my aha moment - the e2O deal allows WTC to very rapidly evolve from being a freight forwarding/CargoWise-centric product to a multi-side, many-to-many, marketplace where ALL supply chain and logistic providers already exist and transact via a combined and enhanced WTC & e2O marketplace - that is a very different way of thinking of WTC and is absolutely huge.

Then all of the acquired e2O ecosystem makes total sense - new software capability, the connected enterprises, the ecosystems, the volume of trade.

The opportunity is then (in RW's words): 

• By bringing in e2O’s capabilities into the Cargowise ecosystem, WTC connects all supply chain participants including exporters, importers and domestic shippers, ocean, air, rail and road carriers, terminal operators, warehousing, customs, border agencies and trade regulators as well banks and trade financiers.
• Removing barriers to efficiency and connecting the entire marketplace allowing all players to access the benefits of a simplified and unified process
• Opportunity to address any inefficiencies within an $11tn marketplace involving global, local and regional partners is significant
• E2O accelerates WTC’s capability by at least a decade
• Fundamental of this deal - overlap is incredibly small, complementary nature gives the WTC the ability to cover space that WTC has no access to or presence in - I am now almost unconcerned with the extent of, or the lack of, overlap with e2O - the team will work through these as part of the standard WTC integration process and work out how best to address the combined capabilities.

CONFIDENCE THAT WTC CAN PULL OFF THE INTEGRATION

I walked away from the call with significantly more confidence in WTC’s ability to pull this off based on the following comments by RW and Mark:

• “Every software company that WTC has bought is complex - this is not more or less complex, e2O happens to be broken up into a series of products which makes it comparatively very simple to consume vs one big business where everything is deeply integrated which is harder to absorb. Each of the e2O acquired components are about the size of Blume Global and Envase - learnt from these acquisitions and have improved internal processes”
• “No burning platforms - nothing is particularly broken”

Applying my own experience in systems integrations, the key is always to break the complexity of the whole into clearly defined, bite-sized chunks, then deal with each bite-sized chunk. Richards comments on the size of the components being around Blue Global/Envase likely means that e2O is much more modular than say a highly integrated SAP ERP where there is hardcore German-precision tight integration across the entire product suite. This significantly de-risks technical integration complexity as WTC has clear demonstrated capability to properly digest and integrate acquisitions.

WHY e2O INHERENT COMPLEXITY IS NO LONGER A CONCERN

My other prior concern on e2O, which, from a customer’s perspective, can be really challenging to wire it up and get it going.

Coupled with the “marketplace” concept, it now seems clearer that the CargoWise-e2O integration would occur at a much higher level platform/module level. Meaning, the integration is essentially between the WTC platform/CargoWise and e2O, module by module, to form the enhanced “marketplace”. Then each e2O (and Cargowise) customer connects into that enhanced marketplace. 

Which then means that whatever customer-centric complexity in wiring up e2O to suit its own environment is likely to be completely transparent to the CargoWise-e2O integration process. Any customer-end e2O complexity thus should not come into play into the integration at all - all they should be caring about is that a company hooks its e2O up to the enhanced marketplace and off they go.

@Solvetheriddle has asked a key question: "why WTC will succeed where others fail" It's a $100bn question!

It is too hard a quesion for me to try and answer fully this late in the day, and it would probably take me too long anyway. So, I will instead pick out a few tables generated by my BA ChatGPT.

The first illustrates why Cargowise and E2Open are so complementary, Cargowise brings its near dominance of the freight forwarder segment. Freight Forwarders are pivotal, as they play a role at some point in about 80-90% of global trade in goods.

E2Open has spent decades competeting with the other players who have tried to build integrated planning and execution tools. For example, I think we heard today that some 18% of global container movements pass through E2Opens software.

So now think about $WTC's CTO in the process of going live, and when integrated with E2Open, having sight of at least 18% of global container movements. RW made the point on the call today that the longer the visibility up the supply chain you have of a container movement, the more options you can generate to optimise and reduce costs. Basically, once the integration is complete, then "TradeWise" should be able to generate incrementally efficent end-to-end outcomes for its customers, and $WTC will be able to capture a portfion of that efficiency.

Here are the analyses of interest I referred to:

Table 1: WTC vs. other integrated software companies:

Key Message: $WTC + E2Open now gives $WTC a significant presence across all supply participants. That's new.

Table 2: Notable Attempts at Creating an End-to-End Logitics Software Platform

Key Message: $WTC's near dominance of frieght forwarding will act as a unique"glue" (or hub) that factilitates data integration across E2Open's client elements.

I have no idea how to estimate the value prize that might be obtained by the $WTC and E2Open combination. But I have no doubt that the combination is going to create at least 5 years of platform development opportunities, each of which will deliver access to greater efficiencies for customers.

In the back of my mind, I have been wondering for some time whether, as they got into Blume, Envase, Matchbox and then started pulling it all together with Container Transport Optimisation, if - on moving away from the natural "hub" of freightforwarding - $WTC was confronted by how challenging integrated logistics really is. I'm wondering if that created the imperative for them to do something bigger, like E2Open. The timing just seems too convenient, given also the delays to rolling out CTO. I wonder if there is something more here than meets the eye? I don't know the answer to that question, but it will be one lens through which I look at everything they say over the years ahead.

It is a very exciting deal, as far as I am concerned.

Disc: Held in RL and SM

yes good points Mike, that last paragraph is the key, i have no idea but i suspect complexity goes up exponentially as they spread across the logistics chain. the size of the prize is worth the capital and effort, but progress will be interesting to monitor, could take a bit before we have an idea of success or not. maybe having an idea of key milestones reached or missed is worth plotting as they progress, have to have a think about that.