Estonia
Logistics
Closes Jan 09, 2023 23:59
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AYREN by IseKallur.ee

Let's digitize the construction sector into the 21st century!

80 500 € (80%)

of 100 800 - 300 240 € goal funded

32 days to go

3,01 % to 8,45 % of company offered
240 € minimum investment
Invest

Quick Pitch

Isekallur.ee is Estonia's first and largest aggregates e-shop. We are the first tipper truck company in EU that has successfully raised funds from crowdfunding, Top 10 Young Entrepreneur of Estonia 2021 (chosen by the Estonian Chamber of Commerce and Industry, LHV bank and the Estonian President), Äripäev gazelle 4x in a row. Compared to the 2021 Fundwise campaign, we have doubled our truck and tractor fleet in 2022 to 30 different units and we will reach an annual turnover of over 2 million euros. We have also helped to establish and open an unique logistics complex where all heavy machinery related services are located in one center.

We have proven ourselves as an already well established company that has achieved a lot and can make big changes in the market. Having our own machinery park, long-term experience in the field and knowledge of how to digitalize traditional sectors creates unique opportunities for us to develop and test digital products for the global market. Our plan is to continue with our core business in Estonia, but today we stand at the threshold where in order to conquer the world and continue our fast growth we need take upon a change. A tansformation from trucking company based in Estonia, into an international Start-up IT company.

To achieve this goal, we have developed a new product. AYREN.EU (Automate Your Rental Equipment Network) is a B2B platform based on the SaaS model, for digitizing the construction sector to Industry 4.0 level. Selling software is more scalable business model that enables rapid expansion to new markets around the world.

We have been engaged in product analysis, validation and software development for the last 1.5 years. Product development is supported by EAS (Enterprise Estonia), the development manager is Eero Otsus, former Postimees.ee developer, system architect and head of the development department. In addition to working at Postimees, Eero has orchestrated package robots at Starship Technologies and rode a unicorn at Pipedrive. The Ayren platform is in the final stages of the Stage 1 development, and the launch of a working product will begin in January 2023.

With YOUR help, we want:

  1. Launch the new B2B oriented SaaS platform AYREN.eu in Estonia.
  2. Create an in-house IT development team and start recruiting a team for international expansion.
  3. Develop our next planned stages and start testing the product in foreign markets.

 

                                  Join us in conquering the world!
  This is Your chance to get equity, to be part of building something big,
            and to help us move towards our goal under the AYREN brand –
                         to be next Estonian IT-technology unicorn!

 

Problem & Solution

PROBLEM

According to the digitization index, the construction industry is one of the least digitized sectors in the world: in the USA, the construction sector is second to last, and in Europe, it is in the last position of the digitization index. It has been observed that four factors generally contribute to the digitization of the sector: company size, complexity of core activities, content of knowledge and skills, and competition. Greater digitization and automation of the construction activities of companies is important to increase growth of productivity. The problem of insufficient digitization in the construction sector is also characteristic for Estonia, which otherwise presents itself as a digital country.

Research by the Ministry of Economic Affairs and Communications confirms that the digitization of the construction sector is lacking behind. Our goal is to simplify and automate the sale of products and services to business customers, to offer them faster and more convenient signing of contracts, customer service, invoicing and reporting.

ANALYSIS OF PRODUCTIVITY, ADDED VALUE AND ECONOMIC IMPACT OF THE CONSTRUCTION SECTOR - FINAL REPORT", University of Tartu, RAKE - www.mkm.ee/media/185/download

LONG VIEW OF CONSTRUCTION 2035, CIVITTA, Ministry of Economic Affairs and Communications - www.mkm.ee/media/108/download

Analysis of creating a long view of the construction industry - 7 big steps CIVITTA, Ministry of Economic Affairs and Communications - www.mkm.ee/media/188/download

The long view of construction 2035 points out that, according to DESI 2020, "One of the major challenges of the Estonian economy is still the digitization of companies and the general integration of digital technology."

ANALYSIS OF PRODUCTIVITY, ADDED VALUE AND ECONOMIC IMPACT OF THE CONSTRUCTION SECTOR 2020 - "In several interviews conducted during the study of the Construction Sector by MKM, it was highlighted that the implementation of innovative solutions (including modern digital solutions) in Estonian construction companies is difficult primarily due to the small size of the companies and the related insufficient human and financial resources. Greater digitization and automation of the construction activities of companies is important to increase productivity."

The long view of construction 2035 describes the following - "At a time when industries are moving towards digitalization, the construction sector is in the role of a laggard compared to other sectors of the economy. According to a McKinsey (2020) report, the reason is cyclical demand, due to which the construction sector makes small investments compared to other industries. According to a study by the European Commission, companies that have implemented technological solutions are clearly more productive and significantly more economical, which is why the construction sector must take radical steps towards digitization, in order to prepare the construction sector to reach the 4.0 or even 5.0 level by 2035, instead of today's 3.0 level."

The analysis of creating a long view of the construction industry reveals 7 big steps - "Construction projects are becoming more and more complex, and the investments of companies in the construction industry in research and development have a smaller share compared to other economic sectors (although being a strong contributor to economic development) which illustrates the need for digitized solutions. The main reason for the low investment to research and development activities is the fragmentation of the construction industry, i.e. the industry consists of many small and medium-sized companies that lack the financial ability to make investments related to research and development activities."

All documentation is still largely on paper and often arrives to office dirty, waterlogged and/or unreadable. Equipment management is done by owners in Excel and on paper, or other alternative solutions are used, which are offered by, for example, GPS software (Navirec, Gsm tasks, Mapon), but which do not solve their market-specific problems. Most of the software on the market offers digitized job management for long-distance haulage companies, not for excavators, tractors, dump trucks and other infrastructure construction companies.

SOLUTION

There are no similar solutions on the market today.

Why?

Traditional transport companies, especially in the construction sector, most of which are SMEs, lack the know-how and resources to carry out large-scale digital developments. And on the other side digital companies lack specific information and experience about the sector's everyday problems and concerns in order to develop a specific software.

We have a well-thought-out and long-term experience-based knowledge of the bottlenecks in the field of transport and construction. 

Main issues are the lack of an administrative platforms/softwares that automate the use of on-site equipment, the general lack of digitalization of the construction and transport sector, non-existent information about the position and activity of the equipment on the site, and, in addition, paper based management system which is lagging behind.

We originally developed the software only for our own use and to solve our daily problems, but we saw that it can do so much more that we can share with others to improve society as a whole, save natural resources, time and money. We have developed and tested software over the years on our own fleet. It then grew into AYREN. We have presented the product prototype to companies operating in various fields, which all have high expectations. Several large partners (Nordecon, Trev-2 group, etc.) are interested in modern digitalized solutions. We also have validated the product in the United States.​

The main problems that AYREN will provide a solution for:

  • There are no software on the market that digitize construction transport and construction equipment. Software solutions avaliable today are mostly aimed to digitize road transport and are mainly GPS software. AYREN is specifically aimed at heavy equipment operating in construction. Equipment owners, operators, main clients and construction companies, and the communication between these parties. All parties will benefit.
     
  • Construction companies lack the ability to monitor the budget of infrastructure objects in real time and manage the rented object equipment. The construction company and the customers usually have no idea where exactly the machines on their object are located, what task someone is currently doing and how the hours and the quantities of materials brought to the object will add up, if the object has more than 20 or 50 units working at the same time. Machine and material delivery notes are collected when all the work has already been done, and at worst analyzed at the end oh the month together with invoice. Therefore, budgets can be torn apart, in the hundreds of thousands - millions. Often, there are several object managers to check large sites, who constantly drive around and have to deal with work that is completely unnecessary for them - playing nanny and checking machine drivers. AYREN will enable construction companies and clients to manage and monitor all heavy equipment on site. This includes machine booking, tracking machine driver locations, sending out special tasks, real-time shipment statuses for transported quantities and materials, ending with object-based filters, reports, e-waybills and payment solutions.
     
  • Owners of construction machinery lack digital solutions to get the job done, and the sector has been left to languish in 20th century technology of pen, paper and excel spreadsheets. Today, construction transport companies (dumpers, loaders, excavators, etc.) do not have the 21st century solutions to to manage their fleet, employees and customer base. There are no crm and logistics software specific to the sector, and the transmission of employee tasks, checking work process and monitoring working hours is lagging. There are no sector specific billing environments and reporting systems. Today, all these things can only be done partially, and only if you use 4-5 different expensive software services and let the accountant do most of the work. Therefore, SMEs, i.e. small and medium-sized companies, which do not have the financial resources, time or skills to navigate between different softwares, to manage them, or even less so to develop them, give up on digitizing their company altogether. AYREN brings the sector that has worked on paper into the 21st century and consolidates sector-specific solutions on its platform.

Product/Service Details

AYREN is based on the SaaS model - Software as a service. Information from other sources can also be connected to the platform via an API, which in the case of very large customers requires customer-specific solutions that connect our IT solutions with the customer's IT solutions. For example: fuel level sensors, CAN communication data from GPS, personnel accounting, accounting, etc. As part of the Stage 1 of the project, which is already almost completed, a working product will be created. The solution includes, developing the UX and UI, creating the service and software architecture structure, programming and testing the application, and putting it to work in a real work situation. The structure of the service is based on the approach typical of microservices architecture in order to enable the management, scaling, outsourcing and rebuilding of different parts of the service separately and according to the needs arising from the company's development.

In product development and sales, we focus on two target groups - we connect the owner of construction equipment and the builder. All the software has been developed on our own experience, we will test it on our own fleet and rely on the feedback of our customers both in Estonia and the USA.

  • AYREN allows the owner of heavy equipment to have the opportunity to manage his fleet (dimensions, load capacity, inspection, insurance, tolls etc), manage his customer base (including creating invoices, export, sending reminders), entering and sending orders to the driver, driver application, etc. In addition, automated accounting of completed works. Management can deal with their main work - improving the quality of client relations and workflow.
     
  • AYREN allows the customer/ construction company to better manage heavy equipment working on their sites and related transports (number of loads, contacting drivers, sending tasks) from various devices, including mobile phones, to prepare consolidated reports of the work performed and to receive real-time information about the workflow and location of the machines. The platform allows the customer to access the workprocess, the locations of the machines on the object, the quantities transported and sign delivery notes, see the invoices sent from the equipment owner's system, etc. In the future the client will have time to deal with his most important task - to ensure that the infrastructure work is completed on time, that the machines are in efficient use and that the object is within the planned budget.

In addition to solving the everyday problems of companies, AYREN also removes the need for a large amounts of human capital intensive work in the form of logisticians, site managers and accountants who normally control and manage processes. Digital tasks, digital delivery notes, digital timekeeping, construction-specific logistics systems and CRM billing environments are only the tip of the iceberg.

Business model

Isekallur OÜ's vision is broader than just providing a transport service. Our goal is to be the leader in digital revolution and forefather of new opportunities to the construction sector. With the help of the development of IT systems aimed at business customers, IseKallur OÜ is transfering from a tipper company offering regional transport services in Estonia to an international information technology company with a new business concept.

Domestically, the current business trend will continue. Isekallur.ee and the Isekallur brand will remain active in Estonia. In order to enter international market, the company's concept must be changed and it must move to the international market with a new brand. The AYREN brand will be aimed mainly at the foreign market.  All development and business activities are carried out through Isekallur OÜ, trademark rights and product rights belong to Isekallur OÜ.

AYREN will be a separate subscription based service.

Market

There are no similar solutions on the market today.

Our goal is to expand both in the EU and US markets. In addition to neighboring countries in EU, we have taken the U.S. as our main target. The US is inevitably a larger and more accessible market than the EU, and products and services are more easily scalable due to the country's scale, wealth and common English language. There are approximately 28,500 dump truck companies and 3.78 million construction companies operating in the US market alone by 2022. The Medium- & Heavy-Duty Vehicles market structure of 2021 points out that there are 247,475 registered dump trucks on the US market, and there are hundreds of thousands of dumpers, excavators, front loaders, etc., which are not in the register, but which AYREN targets. We also have contacts in US who are willing to help us get the product to the market.

The size of the global dump truck transport market by 2030 is estimated to be over 30 billion euros. Based on various sources, the size of the global construction market is around 10 trillion today, by 2030 it will have doubled to between 14-20 trillion. Similar rise will happen with the market for software solutions operating in the global construction sector (it also includes planning, design, etc. software), which will reach approximately 20 billion in total by 2030. The goal is to grow to 25,000 users by the end of 2025 and reach 100,000 users by 2030.

Dump Truck Services in the US - Number of Businesses 2002–2027

Construction in the US - Number of Businesses 2003–2028

Medium- & Heavy-Duty Vehicles Market structure, Environmental Impact, and EV Readiness 2021

Dump Truck Market Research Report Information (Construction, Mining, Agriculture & Forestry, Others) Forecast 2030

Global Construction Management Software Market – Industry Trends and Forecast to 2029

AYREN targets hundreds of thousands of customers around the world who use outdated solutions for their daily work and logistics management. The platform's services are unique and help to contribute to the Industry 4.0 digital revolution in the construction and heavy equipment sector, where TODAY there is lack digital solutions.

Traction & Accomplishments

To date, we have increased sales by over +4500% and we are one of the largest and best-known service providers on the Estonian market. We are the first tipper truck transportation company in EU that has successfully raised funds from crowdfunding, Top 10 Young Entrepreneur of Estonia 2021 (chosen by the Estonian Chamber of Commerce and Industry, LHV bank and the Estonian President), Äripäev gazelle 4x in a row. 

Over the years, we have continuously developed our environment based on the feedback we have received from our customers. We believe that even complicated things can be done easily, and the customer's time is the most valuable resource. Time = money. We want our customers not to have to deal with activities that cause additional nervous expense - searching for transporters/intermediaries, comparing, communicating with several different people to finally get an understandable offer, and even then not knowing if or when the load will arrive. By using the e-shop created by us, the customer can focus on what is important to him.

We started with isekallur.ee's ordering environment and logistic solutions in a way that allows us today to receive many times more orders than other tipper companies on the market and to carry out transports that were previously unwise for carriers. In most cases, many companies lack the ability and desire to transport smaller quantities and individual loads. They also lack the appropriate machinery and logistics for this.

Our advantage is a wide selection of machines with all different sizes. Thanks to the developed system, we are able to accept orders 24/7. We also have no need to have a warehouse and materials in stock. We cooperate with all the biggest builders, quarries and material suppliers in Estonia.

In addition to the e-commerce environment, we have developed a complex logistics and management system in the background, which has fully automated order reception, processing, and logistical management.

The AYREN platform will take advantage of the knowledge and technologies created and tested by isekallur.ee over the years.

How We’re Different

We are the Leader of the sector, with a capital letter.

Traditional transport companies do not offer competition because they lack functional digital solutions.

On the other hand softwear companies do not have their own machinery and the corresponding experience of everyday problems.

Ayren's competitive advantages are:

  • A unique new complete product that combines existing and new services aimed at solving customer problems.
  • Long-term cooperation experience with mineral miners, distributors and construction companies.
  • In-depth knowledge of the sector's problems.
  • Solving real problems on the market.
  • Competence of employees, both digital competences and extensive management experience in the field of transport.
  • Customer trust in Estonia, already developed and working solutions.
  • Customer-centric approach and comprehensive project-based implementation.
  • Emphasis on efficiency, which helps reduce costs for industrial enterprises.
  • Estonia's favorable business environment and international recognition of Estonia as a country of start-up companies.

IseKallur OÜ has a very strong position thanks to good competitive advantages in terms of target market, service and development potential.

The following measures contribute to the sustainability of the project:

1) Economic and environmental sustainability - Isekallur OÜ has continuously contributed to product development and increasing the efficiency of work processes. The project makes today's work processes more economically cost-effective, which also contributes to environmental sustainability.

2) Financial sustainability – IseKallur OÜ is oriented towards growth and therefore the planned investments are necessary to secure the company's long-term market position in Estonia and to enter the foreign market through the new Ayren brand. The company has planned an increase in turnover and profit, which directly results from the development of the new service.

3) Management sustainability - The activity of the owner and the board in planning the company's strategic development and coordinating daily activities is an important factor in ensuring the company's overall development and success. The management of the company is constantly acquiring experience and knowledge, on the one hand, in the field of organizing the company's activities and on the other hand, in the field of company management. The board members have acquired professional skills that are important for construction companies in offering their services for more than 10 years. Among other things, board member Silvar Vähk has prepared a bachelor's thesis related to the service at EBS.

4) Social sustainability - Due to the impact of the project, the digitization of the construction sector will increase, the share of the gray economy will decrease and tax compliance will increase.

5) Cooperation sustainability - Very strong cooperation with end users is already done during product development (co-production), connecting the service with the customers' IT systems makes the use of the service convenient and replacement difficult.

Uses of Funds & Timeline

In 2021 168,160 euros were raised in crowdfunding, the purpose of which was to expand the machine fleet and raise initial capital for software development. As we promised, 25% of the involved capital, or about 42,000 euros, was directed to software development, to which IseKallur OÜ added its own capital of the same magnitude. 75% of the remaining capital was directed to increase and renew the machine park.

100% of the capital raised will be directed to software product development and for new customer onboarding. The larger the contributing amount, the faster and on a larger scale we can do the aforementioned stages

We plan to grow in valuation by at least 3-4x in the coming years. With the maximum amount included, our plan is as follows:

  • Stage 1 - final product will be ready at the end of 2022, the goal is to launch the FMP (Fully marketable product) SaaS product AYREN in Estonia at the beginning of 2023.                                 
  • Stage 2 - 2023 1st-2nd quarter, live testing of Stage 1 developments of the platform will take place in Estonia, removal of errors and further development of Stage 2 for international expansion.                                                                                                                                                       
  • Stage 3 - 2023 Q2-Q4 testing of the platform Stage 1 - 2 will take place in the USA and Estonia neighbouring countries​, development of new additional services.                                                          
  • Stage 4 - Our goal is to launch the AYREN.EU portal in the USA and elsewhere in Europe at the beginning of 2024.

If only the minimum amount is reached, we will continue the same activities, but with limited funds, software development and the speed of expansion are limited, so the time frame for achieving the goals may shift.

In September 2022, we went to Indiana and Illinois states in the USA to conduct market research, validate our product and meet with potential customers.

Obligations to Investors, Profit Distribution

Investors get a stake with all the accompanying rights. We are an early-stage technology company in a unique starting position with high growth potential.

Levels are separate, i.e. not valid on a cumulative basis with the previous campaign. Dividend payments have been pushed into the future so that we can grow quickly, which is not possible by distributing profits to such an extent. Our main focus is growth and expansion, therefore we reinvest the profits of the following years, which means higher productivity, valuation and income in the future.

You will have the possibility of an Ignium secondary market for the unit.
We will raise new capital in the future.
We offer buyback and exit options where possible.
Potential future dividend payments.
You can have a say in our development.

START IT UP - from 240 eur

  • Equity
  • Possibility to exit with EXIT in the future
  • One-time discount from the Isekallur.ee e-store -20%
  • Names of all investors on the wall of our own logistics center.

BRONZE - From 1200 eur

  • Equity
  • Possibility to exit with EXIT in the future
  • One-time discount from the Isekallur.ee e-store -25%.
  • -5% discount from the Isekallur.ee e-shop for five years.
  • If desired, AYREN platform subscription for 12 months free of charge.
  • Names of all investors on the wall of our own logistics center.

SILVER - From 2400 eur

  • Equity
  • Possibility to exit with EXIT in the future
  • One-time discount from the Isekallur.ee e-store -25%.
  • -10% discount from the Isekallur.ee e-shop for five years.
  • If desired, AYREN platform subscription for 24 months free of charge.
  • Names of all investors on the wall of our own logistics center.

GOLD - From 10,080 eur

  • Equity
  • Participation in Isekallur and AYREN
  • Possibility to exit with EXIT in the future
  • One-time discount from the Isekallur.ee e-store -40%.
  • -15% discount from the Isekallur.ee e-shop for five years.
  • If desired, AYREN platform subscription for 36 months free of charge.
  • Names of all investors on the wall of our own logistics center.
  • Self-titled IseKallur and/or AYREN T-shirt.
  • Face mask with our logo.
  • If you wish, we can organize a truck driver experience package for you so that you can feel like a real dump truck driver.
  • If you wish, choose your favorite car from the fleet and we will design and sticker your own dump truck or tractor.
  • If you wish, you can meet our management at dinner, where we will discuss more detailed future plans and visions.

Risks and Mitigation

Like any company, we are also exposed to threats arising from the economic environment. In our short time of operation, we have seen taxes sharply raised and lowered by the government, the doubling of fuel prices, the Covid-19 pandemic and start of Ukranian war. Global and local crises can quickly affect consumption and construction volumes. The construction sector and work are subject to seasonal fluctuations influenced by climatic conditions. While private sector orders shrink in the winter months, B2B sector workloads remain high. If it is snowing thickly and there is a biting frost outside, our heavy equipment will clear the snow. Thanks to our innovativeness and distribution of services between different branches, we have continued to grow quickly and profitably. The secret of success is quick adaptation and the availability of modern digital solutions.

You can get a longer risk analysis and overview from our business plan.