Programming Trading Systems, Building a Drilling Automation Platform, and Founding a Tech Startup: The Story of Andrew Bruce and His Vision of Bringing Smart Contracts to Industrial Supply Chain
In Episode 25 of the Oil and Gas Elevate Podcast, hosts Sean McCoy and Eric Johnson interviewed Andrew Bruce, CEO of Data Gumbo. In this article, OGGN contributing writer Stephen Forrester had a chance to talk to Andrew about his college adventures, working in programming and early experiences in tech, formative years at NOV helping to launch the company’s NOVOS process automation platform, and founding Data Gumbo—which transformed from a drilling data analytics company to a pioneer in blockchain-based smart contracts.
“People are always asking me to write a book about my life,” chuckles Andrew Bruce, CEO of Data Gumbo. “Thing is, it would only be about three-and-a-half pages long, because most of it I wouldn’t want to be published!”
Andrew went to school on the Isle of Man, a self-governing British Crown Dependency in the Irish Sea between Great Britain and Northern Island. For those unfamiliar with the ins and outs of Britain and its territories, a Crown Dependency is not a sovereign state, but rather a territory for which the United Kingdom is responsible. The island has its own government, and there has been a significant Gaelic influence since the 5th century AD.
“It’s famous for tax evasion and motorcycle racing,” Andrew laughs. “If you’ve ever heard of the Isle of Man TT, it’s very well known for that.” Known worldwide as one of the most dangerous racing events on the planet, the Isle of Man TT has been held since the early 1900s. In that time, it’s managed to rack up more than 200 fatalities.
Andrew explains that back then, there were effectively two paths for a young person thinking about their future: go to a university, or go to what’s called a “polytechnic,” where you can take vocational courses in technical domains. He also recalls that you could do what was called a “sandwich course,” where you received practical work experience in addition to your standard academic pursuits. “I wanted to do that, but at the time, the only people who were doing sandwich courses in the UK were polytechnics,” Andrew says. “My dad was a complete snob, and he said, ‘No son of mine is ever going to go to a polytechnic.’ So, I had a bet with my dad that I could find a company to sponsor me and send me to university in America.”
This was the late 1970s and early 80s, where advances in computer science were starting to accelerate. “Long story short, I found someone to sponsor me and send me to university,” Andrew recalls. “I had to work for them every summer and Christmas holiday, and for 2 years after I graduated. I’ll leave all the colorful stories out, but I ended up in Florida, at the Florida Institute of Technology.” Previously a C and D student who’d enjoyed spending time playing rugby and cricket far more than burying his head in a textbook, Andrew suddenly found himself getting A’s in all of his courses. “Clearly there was something wrong with the university,” he jokes. “Andrew Bruce was not an A student.”
Deciding to go to a different university, Andrew was spurred on by his roommate from Massachusetts, who insisted that all the best schools were in New England. “I couldn’t stand him, and I thought he was an idiot,” Andrew says with a grin. “So, when he told me to not to go to WPI because it was a crazy place where they let you make up your own degree and program, I of course went there—if he didn’t like it, there was probably some merit to it.” Suddenly faced with a school that was incredibly challenging and academically rigorous, Andrew simultaneously found his sponsorship by the company in the UK falling through. “That was for a lot of colorful reasons,” he says, “not the least of which was that the CFO stole £20 million from them. So, they didn’t have any money to sponsor me anymore.”
Fortunately, Andrew was accepted into a co-op program with Digital Equipment Corporation, which provided all the equipment at the university. The schedule he had to work to balance a full-time job with his coursework was brutal. “I’d get up at 4:00 a.m. and work until noon,” he explains. “That’s how I’d put in my 8 hours. Then, I’d go to my afternoon classes. That’s how I paid for university.”
When he went back to the UK after finishing his degree, Andrew’s experience with Digital Equipment helped land him a new gig. “Thank God I’d worked for Digital Equipment, because at the time, the entire city of London was going through banking deregulation,” he says. “The industry used Digital Equipment machines, so I was able to go and work as a contract programmer at Citibank, making £25 an hour.” Andrew was primarily involved with building futures systems and options systems for the trade floor. Of course, it couldn’t be that easy, as he found out when a mystery letter from WPI arrived in the mail. Opening it up, he was dumbfounded by the contents.
“They told me that I was one-eighth of a credit shy of graduating,” he laughs. “I didn’t think they had credits, but apparently, I was an eighth of a credit short. So, I asked them if I could come back and sail around the Wachusett Reservoir while drinking beer to get a PE credit. They didn’t care—they just said I had to do something to finish the degree.” Back in America, Andrew sailed around the reservoir, loafed about on the boat, and put away a few pints of beer while wrapping up those last few hours necessary to get the degree.
Degree in hand at last, he got a job as a consultant for Myers Holum, performing installations of fixed-asset systems and payroll systems for a variety of customers. “I had two very interesting clients at the same time,” he recalls. “One of them was the First Church of Christ, Scientist, where my language got me in trouble; the other was the New York Post, where my language helped me fit right in. Switching between the two of them was a colorful experience.” While the Church didn’t offer any benefits, the New York Post had to deal with 14 unions; on that account, Andrew had to program all the union laws into the payroll system.
After Myers Holum transferred Andrew to Houston, he stuck around for a bit, even getting some firsthand experience with a phenomenon native Houstonians know all too well: flooding. “I discovered in a hurry what a Texas flood is,” he says. “I was working at Temple-Inland Forest Products, and one day, it was raining, and they said it was going to flood. I laughed at them, and the next thing I know, there was a firetruck rolling down the driveway to rescue me in a boat. I’d never seen anything like it in my life.”
Andrew then had his first flirtation with entrepreneurialism, leaving Myers Holum with the hope of starting his own company. His intent was to write trading systems, but he quickly learned that you needed more capital than he had to successfully run your own business. Additionally, he was actually in the country illegally, as Myers Holum had been his sponsor and without them, his H1 visa was invalid. Andrew ran out of money to write his trading system, so he worked as a delivery driver under the table for a while. “Then, I asked my girlfriend at the time if she wanted to get married, and she said no,” he chuckles. “So, I was prepared to pack my bags and head back overseas. She changed her mind and said yes, and after working it out, we eventually made our way to the courthouse.”
As he and his new wife worked through the paperwork to have him legally in the country, Andrew was able to quit the delivery driver job and get back into programming as a contract programmer for Texas Eastern Products Pipeline Company (now Enterprise Products) helping them to build a scheduling system. His journey into oil and gas continued when he went to work for Texaco Natural Gas, where he assisted with the development of a trading system. That entrepreneurial itch, however, never really went away, and Andrew still had the dream of having his own company.
Briefly spending time with a friend who had a headhunting business, Andrew stepped away from the programming world to learn about sales and business development. When that company was acquired, he felt that the time was right to launch his own headhunting business. “With Texaco as my main customer, I built a headhunting company that provided IT resources for the oil and gas industry,” he explains. “Then, after the merger was announced between Chevron and Texaco, I asked if they’d be interested in commercializing the trading system I’d helped built all those years ago. They said yes, we negotiated a price, and then they invested in the company.”
Things were looking up until the Enron scandal, which happened just 5 months later. “The target market disappeared from underneath us overnight,” Andrew remembers. “I spent 5 years trying to keep that company alive, but I ended up selling the assets to a competitor.” Back on the job market, he started working as an industry analyst, with one of his main clients being SunGard Energy (now part of FIS). They quickly hired him on as the Senior Vice President of Product Management and Strategy, with the role overseeing energy trading and risk management systems.
A year and a half passed rather uneventfully, and Andrew found himself at a company Christmas party in a kilt. “As I was walking away from the President of the company and his wife, they asked me to give them a flash,” he says mischievously. “So, I did, and then I got fired. I didn’t last there very long. Moral of the story, don’t wear kilts to Christmas parties—if you’re Andrew, at least.”
He next went to a company called nGenera (later Moxie Software and goMoxie), which provided end-to-end software solutions to manage and accelerate collaboration among employees and between enterprises and their customers. “We imagined a world where you could use a model of the energy industry as a new way of thinking about energy trading, with all the counterparties interconnected,” Andrew says. “This was actually the first foray into what we’re really dealing with today. It’s pretty interesting that we were thinking about this way back then.”
When a consulting gig was sold to National Oilwell Varco (NOV), Andrew was the chosen one to take on the new job. “They looked for someone who had ‘energy’ on their business card, and that guy was me,” he recalls. “I’d never seen an oil rig in my life. The closest I’d come to energy was energy trading, but that was it. I knew nothing about drilling rigs or upstream at all.” Nominated for the job regardless, Andrew went to work with Pete Miller, then the company’s CEO, as part of the team developing a 30-year strategy for the company. “NOV said that they liked my style,” he remembers. “So, they hired me.”
Starting off in Organizational Development for NOV’s Rig Solutions (now Rig Technologies) business, Andrew was tasked with helping align people in the operating segment behind a clear vision, strategy, and culture. All the years of M&A activity had left a confused culture across multiple offices and multiple continents with little desire to collaborate. His solution? A new control system. “Because of all the different control systems across all these acquisitions, there were multiple product engineering, aftermarket, and service groups,” he explains. “So, I said we should make a new control system that acts as a forcing function for one aligned strategy within Rig Solutions.” Pete Miller told him to imagine the future and design backward from that, not design something forward based on what you already have. This lesson, Andrew says, has stuck with him to this day, even informing his current work.
One trip to Draper Laboratories later and Andrew was inspired, especially by the way that spacecraft were able to autonomously land on an object using technology developed by Draper. He saw in this a way to autonomously drill a well. “So, we set about to create an autonomous drilling system for drilling rigs, based on the algorithms from Draper,” he says. “We worked closely with them during that time, and we drilled our first autonomous well on a test rig in Ulrig, outside of Stavanger, Norway. We also worked with Chesapeake Energy and Nomac (now Patterson-UTI Drilling) to drill on live rigs in the U.S.” The testing was successful, and Andrew said this time was formative because the projects involved adding the new system—which the industry now knows as NOVOS—on top of existing control systems, creating layers of new functionality and process automation that brought together the tasks executed by surface machines with high-speed downhole data informing drilling parameter optimization. This was something unheard of, an advancement truly meant to drive the drilling industry forward.
When Pete left in 2014, Andrew followed closely behind, taking a hop and a skip right on over to NOV’s competitor, MHWirth. Though the hope was that Andrew would help accelerate the company’s innovation and allow it to better compete with NOV, the prolonged downturn continued to take its toll on company headcounts, good people getting let go left and right. When the dust had settled and he realized he wouldn’t be able to execute a transformation plan, Andrew found himself in an executive leadership role—Chief Operating Officer—at a company that didn’t really need one. “You don’t need a global COO when you’ve laid everyone off,” he says. “So, we agreed to part ways.” As has been the case with much of Andrew’s story, when one door closed, another opened—and this time, he decided that he was going to successfully found a disruptive company.
That company? Data Gumbo, with humble beginnings in a former methamphetamine lab—standard operating procedure for startups, right? “I started Data Gumbo in what was a former meth lab—and there’s a whole story there—in December of 2015,” Andrew says. “It’s an experience that most people don’t appreciate. A person is defined a lot by the company they work for. When you step outside of that company, all the credibility that you were given because of who you worked for goes away. You’re literally calling people you called 3 weeks ago, and now they won’t answer the phone. It’s a chastening experience to start a company from scratch.”
To overcome some of these challenges, he started working with Station Houston, a local hub for entrepreneurs that provided him with access to the investment community in the city and connected him with like-minded people trying to get businesses off the ground. “I have to give Houston credit for what we’ve been able to do at Data Gumbo,” Andrew says. “I don’t believe we could have done this anywhere else in the world except Houston. The people have been so incredibly generous with time, money, resources, brainstorming, opening doors—it’s been a humbling experience, how Houston has supported us at Data Gumbo and the entrepreneurial community.”
With a total team of five people, Andrew and his cohorts went about bootstrapping the company, securing funding for product development via a grant from the Norwegian government. The first version was a data platform that aggregated and standardized data while putting in stricter security protocols for access. This data could then be used by the appropriate parties for machine learning, AI, condition-based maintenance, and data warehousing. With so much information coming in from so many assets—many with different owners—during an operation, Data Gumbo’s solution made sense for an industry looking to do more with its data.
When Data Gumbo landed a contract with Hilcorp, things escalated quickly. “It was a great day, but it was also a terrible day at the same time,” Andrew explains. “We had to have workers’ compensation insurance and all the liability insurance. That cost money, and we had no money—so, how the hell are we going to pay for this?” Thanks to Insperity, they secured the necessary workers’ comp by putting Andrew on the company payroll at minimum wage and promising to hire five people in five months; an odd plan, but one that worked, somehow. They then shopped around for the other insurance they needed to get going and prepared to help Hilcorp analyze their drilling programs and make them more efficient.
As this was going on, Andrew was in talks with a supermajor about benchmarking performance in their Gulf of Mexico operations using the Data Gumbo platform. “They said that if they could save a minute per drillpipe connection, they would save $250 million per year,” he said. “It was a staggering amount of money, especially for drillpipe connections, because I knew they could save that minute. We’d built the rigs and control systems at NOV. So, the big question we had was, why on earth aren’t they doing this already?” The answer? They couldn’t get the drilling contractors to work with them. The contractors would love to split the $250 million with the oil company, but they didn’t trust the oil companies to pay the bonus. So, there was a stalemate, with a big payout if the impasse could be solved.
When a friend at Microsoft brought up the idea of cryptocurrency in the energy industry, Andrew wasn’t particularly interested. What did come to mind, though, was the smart contracts offered by Ethereum. “So, I started thinking that we could use our data platform to measure how long a drillpipe connection is taking by taking data straight from the control system,” he explains. “Then, we could feed that into a smart contract, or a computer algorithm, and use that to program the terms of the incentive contract.” The results from each side are then stored in a blockchain’s distributed ledger, which cannot be changed by either side. Data Gumbo, using its GumboNet smart contract network based on the power of blockchain, created trust in an untrusted relationship.
The concept worked, and when Andrew presented at an IADC conference in Amsterdam in 2017 on automating performance contracts, the idea was met with significant interest. When approached afterward, many attendees highlighted that if you could automate a performance contract, you could automate any contract, with Data Gumbo as the “honest broker” of the information. “That was the day we became a blockchain company,” Andrew recalls. “Now, we’re solving a really interesting industry problem. We’re helping them save 10%, and sometimes up to 30%, of their spend.”
Soon after, Equinor started looking more closely at the company, ultimately wanting to be an investor. After an arduous process of proving the solution’s viability, Equinor Ventures did just that, with Saudi Aramco Energy Ventures also coming in on the Series A round. Between the two companies, Data Gumbo obtained a $6 million investment, propelling it to new heights.
Data Gumbo also worked with Equinor to utilize the network. “We did our first big offshore project with Equinor and a service company, automating contracts for drilling equipment, services, and fluids,” Andrew explains. “We were connecting the oil company, the service company, the drilling contractor, the offshore vessel provider, and the helicopter provider, and aggregating all of that data. What previously took 60 days, we gave them on the first day of the following month.”
Today, Data Gumbo continues to build and expand GumboNet so that people don’t need to understand the myriad complexities of building their own blockchains to tap the benefits of smart contracts. Instead, they can subscribe to the network and start automating contracts between counterparties. If someone isn’t in the network, they can join and transact with existing members. The network is changing the way the energy industry does business, dramatically altering a very process-heavy series of transactions across the most complex of supply chains into something very simple and intuitive. No more people in dark corners reconciling invoices; no more going through 34 steps to execute which should be a quick and easy process; no more extended DSOs that threaten the financial health of the service company; and no more lack of transparency into lease operating expenses. “We can change all that,” Andrew says. “Now, you make a delivery, run the smart contract, pay, and you’re done. All that other delay and all that expense goes away.” Everyone wins.
Critically important in the current environment and moving forward will be how companies address their environmental, social, and governance (ESG) goals. With new green targets and increased pressure from investors and regulatory bodies to improve ESG and sustainability, companies are devoting an incredible amount of human capital, time, and money to trying to measure criteria that are often nebulous. Furthermore, due to a lack of standardization in measuring ESG metrics, there’s no guarantee that results will be accurate, timely, or repeatable—think, for example, of operators divesting assets and claiming they’re greener when the assets still exist, just with another company. By putting ESG metrics on a smart contract secured by blockchain, as Data Gumbo does with its solution on the network called GumboNet ESG, sustainability becomes measurable, and the benefits or consequences of ESG performance cannot be changed.
Data Gumbo may have offices in Houston, Stavanger, and London now, but what about those humble beginnings in the former meth lab in Fort Bend County? Andrew laughs and explains the history. “In the back of my house, there’s a 6,000-square-foot warehouse with a 2-ton crane, two massive extractor fans, drop-downs for the water and power, big rolling doors…it was a purpose-made, industrial meth lab. They had 14 people working there full-time. When the guy got caught—and it was one of the biggest drug busts in Fort Bend history—and went to jail, his dad was able to buy the property. I ended up buying the land from his dad and needed an office space, and this guy had built two offices into this meth lab with showers, bathrooms, air-conditioning, and heating. So, Data Gumbo was started in what was formerly a commercial-scale meth lab. I wasn’t looking for a meth lab, but that’s where it started!”
With the company still growing, Data Gumbo has even made some high-profile hires lately, like industry veteran Robin MacMillan. “It’s incredible,” Andrew says, “to have a man of his caliber leading our sales team.” The company is also looking to expand into industries outside of oil and gas, since automated smart contracts are applicable to virtually every industrial sector and supply chain. The sky is the limit, and those who can look ahead would be wise to hop on the train now. We at OGGN wish Andrew and the team at Data Gumbo continued success in their journey!