Meet Dalton Fouts

Dynamo Ventures’ Newest Venture Fellow

By: Santosh Sankar

I’m excited to share that Dalton Fouts has joined us as our newest Venture Fellow in Chattanooga. Dalton will be involved in all aspects of the venture investment and fund management process. He will source startups, take meetings with partners, research markets, and share lessons with our portfolio from his time helping to scale-out Ninja Van in Indonesia. 

Dalton was head of partnerships and key account management at Ninja Van Indonesia, Southeast Asia's fastest growing last-mile logistics startup. Joining Ninja in its first year of Indonesian expansion, he led the night operations and warehouse departments for more than two years during which time he scaled throughput capacity from 2,500 to 125,000 parcels per day. After moving to the commercial team in February 2019, he grew volumes over 250% with partnership accounts contributing more than 90% of total deliveries nationwide.

Prior to joining Ninja, Dalton worked through college in successive logistics positions starting as a package handler at UPS in his hometown of Nashville, TN. He graduated from the University of Miami and was the recipient of a Fulbright Fellowship to West Java, Indonesia.

In his free time, Dalton enjoys running, climbing, and ultimate frisbee. Give him a shout at dalton@dynamo.vc to chat about your startup!


The Dynamo Venture Fellows Program is 6 months long and provides college graduates and pre-MBA candidates with exposure to startups, supply chain and mobility, and the venture capital ecosystem. Fellows are exposed to every aspect of venture capital including but not limited to sourcing, research, decision making, and post-investment support. We will work with the Fellows to find a role post-program in venture capital, startups, or whatever their interest might be. We believe it’s a unique way to support the development of the ecosystem and are excited to improve the program in the coming months. If you’re interested in the program, send us a note to hello@dynamo.vc.

Dynamo Dispatch (01/20/20)

Issue 92 | Joby, Hesai, XPO

Dynamo Dispatch. Weekly update from Dynamo Ventures covering the latest and greatest in supply chain, mobility, and building venture-scale businesses.

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Weekly Commentary 💭

If we were to guess, 2020 will be one for the books as historians chart the history of sustainability and the role of the industrial complex. For those who’ve spoken with us in the last several months, we believe that sustainability is a major trend for supply chain venture investment and one that will be driven by varying levels of regulation/self-regulation.

As you read ahead, note that this week saw MSFT announce plans to be carbon negative by 2030, Citi launch a $150M impact fund that will invest in sustainability, and Nestle committing $2B to avoid virgin plastics and boost investment in packaging innovation. This activity comes on the heels of IMO 2020, as the world’s steamship lines move to reduce sulfur content in the fuel they burn. 

While transportation and industry are estimated to contribute to 50%+ of global CO2 emissions, sustainability does reach beyond just emissions (to note, emissions continue to be an area we’re interested in as electrification requires a whole stack of software solutions to enable). For example, we consider the usage of plastics in packaging (40% of plastic demand is to pack items), food provenance (20% of fish is mislabeled), and validating sourcing practices (80% of companies don’t know if their products contain conflict minerals) as a few of the opportunity areas. Please reach out to us at hello@dynamo.vc if you’re building in the aforementioned areas (or otherwise).

We Are Dynamo,

Santosh, Ted, Barry, and Jon

Note: please add “dynamo@substack.com” to your email client so you don’t miss future issues due to aggressive spam filters.

Supply Chain 📦

XPO Weighing Strategic Alternatives. XPO is flipping the script on its long-time track record of acquisitions. Maintaining its LTL business at its core, XPO is taking a hard look at its warehousing, last-mile delivery, drayage, and brokerage businesses in considering divestment. ICYMI, check out Bill Driegert of Uber Freight on the Future of Supply Chain discussing surge pricing, digital brokerage, and scaling.

Amazon’s Busy Week: Lifts Ban on FedEx Ground for Third-Party Prime Shipments, Plans to Invest $1 Billion to Help Digitize Small Businesses in India, and Expanding Air Cargo Ops. Rival Walmart Expands Its Robotic Workforce to 650 Additional Stores.

📊Top Labeling and Packaging Trends in Art Supply Chains. Loftware takes a look at 5 key trends in the space: end-to-end solutions, traceability & visibility, content management, digitalization, and sustainable packaging. Half of the respondents reported that they currently have separate workflows to manage their labeling and artwork packaging. Related, Startups Raise Record Sums To Take On Packaging Waste.

Maersk Ramping into Cold Storage to Boost Surface Transportation Business. Since announcing a new strategy in 2016, Maersk has dialed into cost-cutting efforts and profitability in its container logistics business at the expense of market share. While Maersk handles about 1 in 5 containers shipped at sea, it manages drayage for less than 25% of its customers. In order to correct this without competing with its large freight forwarder customers, Maersk has set its sights on cold chains. On the topic of trucking, Insurance Renewals Are Scourge to Trucking Operators.

⭐ Fabric Wants to Help Retailers Compete with Amazon. Fabric specializes in fulfillment condensed in tight urban spaces. The company can house 15,000 SKUs and fulfill 500-600 orders per day from a measly 6,000 sqft. space. Fabric plans to open 2 micro-fulfillment centers in NYC this year, enabling sub-two-hour delivery throughout the 5 boroughs. On the topic of warehouse automation, The Drivers Behind Warehouse Automation Investment and Spending on Robotics Forecast to Exceed $112B in 2020.

CBP Announces Cargo Data Pilot. US Customs and Border Protection is exploring technologies to better anticipate potentially illicit cargo for more targeted screening without bottlenecking processes for all other legitimate shippers. This pilot will involve the carriers transferring detailed cargo data ahead of port arrival, including details such as origin, content, tracking, and recipient information. On the international trade front, China and US Sign Initial Trade Pact but Doubts and Tariffs Linger and ARO 2020: Trans-Pacific Lines Look to Manage Capacity.

TfL Launches Freight Innovation Challenge. Transport for London has announced the London Freight Lab, in which they will partner with 10 startups focusing on innovation to tackle freight congestion. Tfl is collaborating with CEVA Logistics, Plexal, REEF Technology, Royal Mail, Thames Water, UPS, and others to evaluate the opportunities. The deadline for application submission is February 5th.

Mobility 🚗

China Auto Sales Slid 8.2% Last Year. From record growth throughout the 2000s, China’s automotive success finally started to taper off in 2018, falling 2.8%. After sliding an additional 8.2% last year to 25.8M vehicles, the market is poised for an additional contraction again this year. Upon closer inspection, German and Japanese OEMs have seen continued penetration as domestic brands receded. Augmenting domestic concerns, Price War Wipes out Half of China's EV Battery Makers while Ionity Increases Electric Vehicle Charging Prices 500% Starting January 31

US DoT Supports Consumer Reports Efforts to Make Car Saftey Features Clearer. The endorsement of a standard list of features does not mean manufacturers must use the new names but does indicate the agency wants more consumer-friendly descriptions (we’ve previously discussed how the term AV should only be used for market 100% autonomous vehicles). If you don’t think this is an issue, consider that a AAA survey found that a single feature can be referenced by up to 20 different names- that’s confusing. Related, Federal AV Policy Has 'Number of Parallels' to Boeing 737 Max Policy

📊McKinsey: The Future of Mobility Is at Our Doorstep. McKinsey summarizes its 2020 outlook on mass mobility, paying particularly close attention to fast followers in the EV space, growing infrastructure demands, and the role of cities in incenting innovation. Zooming in on micromobility, the estimation of the US market size is larger than that of Europe and China combined as a result of pricing differences. On the infrastructure front, From Utah to Florida, States Boost Spending on New Roads and Navigant Research Report Shows Major Growth for Smart Street Lighting.

Waymo’s Long-Term Commitment to Safety Drivers in Autonomous Cars. Humans have been behind the wheel for almost all of the 20M miles of public road testing that Waymo has completed thus far. Despite launching some driverless rides in Pheonix last fall, Waymo is still focusing heavily on strategically positioning its drivers’ employment statuses under staffing agencies to distance them from liability over the next several years. Related video, Mobileye’s Camera-Driven Autonomous Vehicle

Uber Calls on Congress to Boost Cyclist, Pedestrian Safety. Last week Uber launched a campaign in collaboration with various cyclist advocacy groups requesting additional funding for infrastructure to protect pedestrians and micromobility users. Prior to this, Bird had a fund to help cities pay for mobility infrastructure but ran into liability issues. Uber aims to avoid this by taking a more hands-off advocacy approach. Related, Electric Bikes Market to Reach $26 Billion by 2026 while Related, Behind the Gains in US Public Transit Ridership.

Largest Electric School Bus Program in United States Launching in Virginia. In partnership with Dominion Energy, Virginia school districts will begin phasing in electric school buses, initially launching with 50 vehicles. The initial launch will already be the largest deployment in the US. The goal is to roll out a 50% electric fleet, 1,000 vehicles, by 2025. Related, New Jersey Gov. Signs Electric Vehicle Law

Fundraises, M&A, Talent 💸

Joby Aviation Raises $590M Led by Toyota. Santa Clara-based Joby Aviation becomes the best-funded eVTOL startup with this round bringing its total funding to $720M in pursuit of electric air taxis. In addition to the investment, Toyota will partner with Joby to share insights into manufacturing and control processes.

Hesai Raises $173M Co-Led by Bosch and Lightspeed Venture Partners. China-based Hesai manufacturers both solid-state and mechanical LiDARs, as well as integration modules for AVs. The raise is one of the largest yet in the glowing sector.

NextNav Raises $120M Led by Fortress Investment Group. NextNav has developed an indoor positioning system that can locate devices like smartphones, vehicles, and IoT products in areas where GPS signals cannot be received. Columbia Capital, Future Fund, and NEA also participated.

Arrival Raises $111M From Hyundai and Kia. Arrival provides an EV architecture of materials, components, and software that its customers can build on top of. Currently, the company is piloting its platform with logistics companies in Europe that use vans built with its technology.

FlashParking Raises $60M Led by L Catterton. Austin-based FlashParking grants mobile apps for parking providers, enabling a whole suite of services like charging stations and cleaning. The company plans to use the funds to expand its service offering for parking garages and to explore new markets.

Matternet Raises Undisclosed Amount From McKesson. Matternet provides drones as a service for hospital chains, offering software and landing infrastructure as part of the solution so that hospitals can more efficiently move high-value items such as blood samples throughout their campuses. This strategic investment comes ahead of a planned $30M Series B.

Bolt secures $55M in Venture Debt from the EIB. Estonian Uber, Bolt offers a variety of transportation services including ride-hailing, micromobility, and food delivery. The company raised this bout of capital to focus on nailing down some safety improvements within its product line. 

Getir Raises $40M Led by Sequoia Capital. Istanbul-based Getir offers last-minute delivery services for common supermarket commodities, promising hyperfast delivery times of about 10 minutes. The company plans to launch in London by midyear. 

Hitched Raises $5.5M Led by Cottonwood Venture Partners. Hitched is a Houston-based marketplace for industrial equipment rentals. The company intends to use the funds to accelerate its product development and focus on polishing its user story.

Nestle Plans $260M Venture Fund for Sustainable Packaging Startups. As part of a $2.1B investment to cut its use of plastics derived from fossil fuels over the next five years, Nestle will launch a fund to invest in promising startups in the space. 

Proeza Ventures Raises $50M Fund to Back Mobility Focused Startups. Houston and Monterrey-based Prozea Ventures announced that it has raised its first fund last week, making it the largest LATAM investor specialized in the space. “Our mission is to discover and invest in visionary founders building early stage startups transforming the way in which we think about mobility and with whom we can partner to make a more sustainable world”, said Rodolfo Dieck, Managing Director at Proeza Ventures.

Takeaway.com Has Finally Won Its Battle to Acquire Just Eat for $7.68B. Amsterdam-based Takeaway.com announced that 80.4% of Just Eat shareholders had agreed to the all-share offer, greenlighting the acquisition. Takeaway.com has said that the dominance created by the merger will allow the entity to overcome the confounding low margin concerns.

Delivery Hero to Takeover Woowa with $2.56B investment. Food delivery group Delivery Hero raised $2.5B to help fund its $4B takeover of South Korea's food delivery app owner Woowa Brothers.

Google Acquires Pointy for a Rumored $163M. The acquisition of Dublin-based Pointy is proof of Google’s long-term commitment to deepen its foothold in e-commerce — in this case by working more closely with brick-and-mortar retailers. Pointy provides hardware and software technology to help physical retailers seamlessly expand to online channels, especially those with little previous physical-online integration.

Transplace Acquires Lanehub. Asset-light 3PL Transplace brought cloud-based freight “social networking platform” Lanehub into the fold last week. Lanehub will allow Transplace to offer its customers a network of more than 150 shipper members, 250 carrier members, and 180,000 lanes to match them with the lowest cost options.

GlobalTranz Acquires Cerasis. GlobalTranz complements its existing 3PL TMS service with the purchase of Cerasis, a tech-enabled managed transportation and multimodal-focused 3PL service provider. Cerasis is GlobalTranz’s 11th acquisition since January 2017, as the company continues to ride its acquisition-heavy strategy.

Company Building 🛠️

Enterprise IT Spending Expected to Grow 3%+. For those of us focused on enterprise, this is great news - especially in industries such as supply chain that are still in the early innings of cloud, are weighing major upgrades/replacements, and seeing a new way of operating from newer execs.

🎧How I Built This: Jerry Murrell of Five Guys. We were walking through ATL looking for something to eat and were praising the consistency of Five Guys. Consistency is important as a startup scales regardless of the function - buying/pricing, customer service, and product.

Your Life is Driven By Network Effects. “Our networks are our most valuable resource. They are the way our lives express themselves. Those networks are made up of all the people you care about, the people you, inspire, move, and help to live their best lives.”

Who's Hiring? 👩‍💻

Director of Operations at Token Transit in San Francisco, CA.

Integrations Lead at Stord in Atlanta, GA.

Enterprise Account Executive at LEAF Logistics in New York, NY.

Check out other jobs at Dynamo portfolio companies.

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🎙 Check out Dynamo's podcast series, The Future of Supply Chain.

Surge Pricing, Understanding the Market, and Building a Sustainable Business with Bill Driegert of Uber Freight

Future of Supply Chain, Episode 39

By: Santosh Sankar & Matt McHugh

In this episode of the Future of Supply Chain podcast, we sat down with Bill Driegert, Head of Operations and Co-Founder of Uber Freight.

Bill graduated from the Cox School of Business at Southern Methodist University with a BBA in 2002. He then proceeded to MIT where he finished an MEng in Logistics in 2003, writing his dissertation on applying dynamic pricing strategies to continuously replenished perishable goods in consideration of the complete supply chain impact. Bill later pursued further academic studies, completing an MBA in Finance and Entrepreneurship at The University of Chicago Booth School of Business in 2009. 

While pursuing his education, Bill was also honing his skills in the professional world. He served as a Solution Architect for PepsiCo from 2001 until 2006, when he became the Chief Innovation Officer at Coyote Logistics. He worked with Coyote until 2014 when he joined Amazon as the Director of Planning and Innovation. 

Uber Freight brings the innovation of Uber to the freight industry to ensure that businesses are able to operate quickly and efficiently. The Uber Freight app provides both carriers and shippers with the ability to see prices in real-time and instantly fulfills their needs, revolutionizing the freight industry. Uber Freight prides itself on its unrivaled visibility and up-front pricing, producing the information necessary to make the correct business decisions regarding supply chains.  

Image result for uber freight

Source: Uber Freight

Surge Pricing

The idea of surge pricing is not particularly new to the freight industry, although it has been designated in different ways. 

“The concept of surge pricing is already understood in our market under a different name,” Bill says. “When we go to the market for spot pricing we're going to get a surge price, or last-minute price.”

Surge pricing is a simple function of supply and demand. When the demand for carriers exceeds carrier availability, prices will naturally rise. Waiting for a “last-minute” price is going to lead to more expensive freight. As Uber Freight provides instant market pricing, their prices will accurately reflect current market costs.

In relation to carrier availability and the value of the instant market pricing information that Uber Freight provides, pricing is flexible. 

“There are some fundamental dynamics, like supply and demand, that have always been,” Bill says. “I think the advantage of a real-time instant market is that you're able to track those prices much more quickly.”

Understanding the Market

Bill addresses potential confusion about how Uber Freight’s pricing relates to the changes the company is bringing to the freight industry. According to Bill, Uber Freight’s ultimate goal is to make the market more efficient. 

Any successful business needs to have an understanding of the current market and its place in the market. It’s critical to understand what role a business fulfills and what value its services provide to customers. In any industry, knowing your organization’s place in the market and its value leads to long-term sustainability. 

“To solve this market, we have to build a sustainable business,” Bill says. “And ultimately, margin is a measure of the value that you're adding to that transaction.” 

The implication, of course, is that a lack of a margin implies that the business is not adding anything of value to the market. 

As an example of Uber Freight’s contributions to the industry, Bill points to the efficiency that Uber Freight is creating in the market. It’s directly connecting carriers and shippers without the need for anyone in the middle. 

This is all a function of what Bill considers to be one of Uber Freight’s missions. 

“One of our missions is to make life easier for drivers and to make the ecosystem more sustainable for them,” he says. “The number one way we do that is by keeping the trucks moving.”

Hiring the Right People

Hiring is one of the most crucial aspects of any business. Having genuinely good employees allows for a team to be built — one comprised of people who complement one another’s strengths and weaknesses. Bill reminds us that one of the common struggles in the hiring process comes from those involved in the hiring process not realizing their own shortcomings. 

“The number one skill is hiring good people,” he says. “To be able to hire good people, you have to possess a high level of self-awareness and introspection. You've got to be able to recognize your faults, take feedback, and realize where you need to shore up your own capabilities and build a bench that is balanced for the organization.”

To listen to the full Future of Supply Chain episode featuring Bill, click here

Dynamo Dispatch (01/13/20)

Issue 91 | Ride Health, Vecna, Next Level

Dynamo Dispatch. Weekly update from Dynamo Ventures covering the latest and greatest in supply chain, mobility, and building venture-scale businesses.

❤️ We would love your support. Please forward to friends and share on social media.🗞️ If you were forwarded this and found it interesting, please sign up.
🎙 Check out Dynamo's podcast series, The Future of Supply Chain.

Weekly Commentary 💭

Week 1 of 2020 is in the books and a few observations to start the year.  In VC land, there’s plenty of dry powder among investors ($1.5T including PE, according to Prequin) who are exhibiting a “flight to quality” and are less tolerant of unproven business models, addiction to VC-funded customer acquisition, and weak unit economics. To founders’ credit, most teams we’ve spoken with the last three months have acknowledged the need to build a “real business” with consistently improving fundamentals. 

In the supply chain, we enter a seasonally slow period after a banner holiday season. On the international front,  we have positive movement with China on a trade agreement that could give a boost to weak industrial activity while the impact of IMO 2020 is to be seen. Trucking rates coming into 2020 are up near 9%, but there continues to be a correction of supply as weaker fleets are culled from the system. We’re seeing shippers and suppliers prioritize technology spend in solutions with proven operational impact (as seen via M&A, internal R&D, and external engagements). B2C last mile is being forced to sustainability by investors (see Rappi, Grubhub, et al). It might be that in last mile, the appropriate adage is “Your lack of margin is my opportunity.”

Mobility continues to push along: AVs remain in the trough of disillusionment (but Velodyne’s $100 lidar could be huge in hindsight), micromobility is still grappling with unit economic questions, and electrification seems all but a commonality by the end of this decade. We’d love to chat with founders building real businesses around AVs (we don’t care if the peanut gallery is down on the space), doing interesting things in electrification, and 10x-ing passenger movement, broadly.

Looking ahead to the week, we’re back on planes starting this week with a day trip to Houston… drop us a note if you’re a founder, venture investor, or ecosystem stakeholder in the region.

We Are Dynamo,

Santosh, Ted, Barry, and Jon

Note: please add “dynamo@substack.com” to your email client so you don’t miss future issues due to aggressive spam filters.

Supply Chain 📦

🌟Walmart Recruits Picking Robots in Online Grocery Battle With Amazon. This week Walmart unveiled a 20,000 sqft automated warehouse in Salem, NH boasting 30 Alphabot picking robots. The robots, which can pick 10 times faster than humans, are a key part in the wave of microfulfillment operations making online grocery efficient enough to become mainstream. Related, eCommerce Grocery 2020 Predictions.

Rising Low-Sulphur Fuel Costs Begin to Bite Shipping Lines in Asia. Major European bunkering hub, Rotterdam, is favoring far better than Singapore in the wake of IMO 2020 adjustments. Fuel prices in Asia are over 20% higher, leaving some carriers like PIL with several vessels sitting idle waiting for bunker supplies. Check out this week’s Future of Supply Chain podcast where Santosh and Eric Johnson Discuss IMO 2020.

Grubhub Considers Strategic Options Including Possible Sale. Grubhub was one of the pioneers of the food delivery business, having gone public nearly six years ago amassing a $13B valuation at its peak. The company has since stumbled as new entrants in the name of DoorDash, Postmates, and Uber Eats have squeezed margins and markets seek strong unit economics. This trend stretches far beyond food delivery, as Rappi is afflicted by much the same, Delivery App Rappi Lays off 6% of Workers. But back to food delivery, Dinner Bell vs. Doorbell: Children Use Delivery Apps to Subvert Family Meals.

📊McKinsey: Greatest AI Cost Savings Found in Supply Chain Management. Supply chain and manufacturing are the two largest benefactors of AI tools. McKinsey’s survey found that 61% of users saw a reduction in supply chain planning costs, as well as improvements in forecasting accuracy. The market for industrial AI is expected to grow by 52% between 2017 and 2024. 

How FedEx and UPS’s Battle Against Amazon Is Changing Online Retail. As Amazon’s blitzkrieg on conventional parcel carriers continues to transform shipping, small e-commerce players will continue to be squeezed in the months and years to come. The founder of DTC cookware company Milo commented, “either [the 3PLs’] businesses are going to be chopped in half, or they are going to keep steady by increasingly everyone’s rates slightly.”  

📊ISM: Manufacturing to Lowest Level Since 2009. The US saw the fifth straight month of manufacturing contraction as global trade tensions create turmoil across the industry and suppliers look to pass on costs tied to tariffs. There are signs that several sectors including food, beverage, and tobacco products will improve as a result of the phase-one trade agreement, but the outlook for the transportation equipment sector appears grim, as Class 8 Truck Orders Tumble to Decade Low. The silver lining to the trade games, Airbus is Shifting Production to the US.

Knight-Swift and DAT Partner on Rate Forecasting. DAT launches its first pilot of RateView with Knight-Swift this quarter, with additional pilots planned for Q2 with other carriers. DAT possesses a unique ability to offer robust forecasting given its enormous database of hundreds of billions of dollars in freight transactions. On the air front, Flexport Winds Down Dedicated Air Operations.

📊2020 SMB Shipping Strategy Report. Smaller players are still struggling to adjust to the changing consumer expectations driven by the Amazon Effect. 25% of SMBs report competition from Amazon and Walmart will drive their logistics strategy in 2020. Expect investment in leveling the playing field to continue as the importance of delivery is here to stay — 48% of customers said they would choose a different retailer after having a negative delivery experience. Related, How On-Time Was FedEx Compared to UPS and Amazon for Holiday Deliveries?

Mobility 🚗

Uber Looking for the Formula for Success. Despite cost-cutting, Uber continues to mark up huge losses and lost ground in ride hailing, micromobility, and food delivery. Everyone has been patient with Khosrowshahi given the circumstances he entered into, however, over two years in, patience is starting to wear thin. Related, Los Angeles Considers Making Uber and Lyft Go All-Electric,Public Bus Rides for Uber Customers in Las Vegas, and Waymo secures bigger award against workers who went to rival Uber

🌟Lime Ceasing Operations in 12 Markets. The downsizing comes as there’s a “flight to quality” with investors and operators, alike focused on viable business models and clear unit economics. As part of the downsizing, Lime expects to lay off ~100 people. Downsizing elsewhere, Getaround to Lay Off 25% of Workforce.

Hyundai Will Make Flying Cars for Uber’s Air Taxi Service. Hyundai announced that it will be mass-producing its eVTOL to supply Uber Elevate. Hyundai has made bold claims of 5-minute recharging on 60 miles of range, but this technology is very much still in its early days. At this point, there have only been a handful of test flights done around the world. Elsewhere in air travel, Delta Air Lines Bets on AI to Help Its Operations Run Smoothly in Bad Weather

VW Launches Autonomous Technology Unit. The division will be based in Belmont, CA, focusing on commercial use cases, such as cargo transport. VW continues to diversify its AV efforts with both in-house and third-party bets, but ultimately is sticking to conservative projections. Related, Feds Are Content to Let Cars Drive, and Regulate, Themselves

Mitsubishi Motors Enlists Israeli Startup as Japan Plays Catch up on Connected Cars. Mitsubishi is the first Japanese automaker to join a car-data marketplace. Japanese OEMs have been laggards with regards to connected-car services, with just 30% of vehicles sold last year featuring embedded connectivity. Related, Aptiv Smart-Car Platform Wants to Be the Brains Behind Connected Tech, Toyota and Big to Build a Prototype Future City in Japan. and Amazon Alexa Will Ride With Rivian's Electric Pickup and SUV.

How Elon Musk Built a Tesla Factory in China in Less Than a Year. Tesla kicked off production in China this week, the world’s largest EV market, having ramped up the factory in half the time it took for the Nevada gigafactory. In addition to local production, Musk has announced plans for local R&D to create a vehicle designed specifically to fit the Chinese market. Musk rides the hot hand in Germany, Tesla Strikes Emissions Deal That Could “Effectively” Pay for Berlin Gigafactory.

Reducing EV Charging Infrastructure Costs. There are obvious parallels to the solar power industry in making EV infrastructure cost-effective. Component costs will continue to drop steadily, but the emphasis needs to be placed on streamlining indirect costs, such as permit delays, utility interconnection requests, and conflicting regulations. While less problematic than the US, Europe faces similar challenges, UK Power Grid Won’t Handle Popularity of Electric Cars.

Velodyne's Tiny Velabit Packs a Big Lidar Punch for Just $100.Velodyne’s newest lidar is compacted into a form factor smaller than a deck of cards. This development offers promising new use cases for drones and even in mainstream cars — as another low-cost safety technology belonging to the same group as cameras and radar. Speaking of radar, Echodyne Launches Echodrive Radar for Autonomous Cars.

Fundraises, M&A, Talent 💸

Vecna Robotics Raises $50M Led by Blackhorn Ventures. Venca is a workflow orchestration and self-driving forklift provider. The company’s platform is used to manage fleets while interfacing with workers and equipment to optimize freight capacity, warehouse capacity, and waste.

Next Level Aviation Raises $15M Led by Turning Rock Partners. Next Level Aviation is a provider of spare parts for aircraft, focusing primarily on stocking for the Boeing 737 and Airbus A320 families of aircraft.

Ride Health Raises $6.2M Led by Activate Venture Partners. Ride Health connects healthcare providers to transportation options, whether that is an Uber (a company partner) or a regional transportation company. The company estimates 3.6M Americans fail to receive healthcare each year because of transportation impediments.

Seko Logistics Acquires Air-City for Cross-Border E-Commerce. Seko reported it is looking to expand in three main areas: omnichannel logistics; white-glove services; and value-added freight forwarding. Air-City was one of the first forwarders to be certified by the Chinese government. “Air-City gives us strategic airfreight volumes and expertise into China, as the demand for US goods increases along with a rising middle class in China.” 

Trimble to Acquire Kuebix to Transform and Connect Transportation Logistics Ecosystem. Kuebix’s cloud-based TMS comprises more than 20K shipping companies. This advances the growing trend of increasing visibility and collaboration between carriers, shippers, and intermediaries. The transaction is expected to close in Q1.

Goodyear Launches Venture Capital Fund. The $100M fund will be focused on mobility investments over the next 10 years which leads us to believe it will be a follow-on investor in the startup solutions they leverage. Key themes include electric and autonomous technologies, connected mobility solutions, next-generation public mobility, next-generation aviation mobility, future transportation infrastructure, future maintenance and operations, emerging technologies, and new tire materials.

Saia’s CFO Leaves for Top Executive Job at Americold. Saia CFO Robert Chambers has departed from the LTL carrier after 8 months to return to his former employer. He will be succeeded by 6-year company vet Douglas Cole.

Company Building 🛠️

First Round State of Startups 2019. We always include this in our newseltter given the data-informed insights into founder sentiment. Interesting to see concern about a bubble/rockier 2020, diversity still an area for improvement, and hiring continues to gain in complexity with Glassdoor data, compensation, diversity, and remote work all key areas for prospective employees.

Expanding Into Multiple Geographies. Feld shares his thoughts on startups expanding into secondary/tertiary US cities. The magic ingredients to make it work are a culture/operations wired for a multi-location workforce, direct flights from HQ to your secondary hubs, and GREAT video conference. Consider this our invitation for you to open an office in Chattanooga… we’ll even show you around.

Haters. Paul Graham shares his thoughts on dealing with haters as founders must with the success of their startup. “The mistake here is to think of the hater as someone you have a dispute with. When you have a dispute with someone, it's usually a good idea to try to understand why they're upset and then fix things if you can. Disputes are distracting. But it's a false analogy to think of a hater as someone you have a dispute with. It's an understandable mistake if you've never encountered haters before. But when you realize that you're dealing with a hater, and what a hater is, it's clear that it's a waste of time even to think about them. If you have obsessive fans, do you spend any time wondering what makes them love you so excessively? No, you just think "some people are kind of crazy," and that's the end of it.”

Who's Hiring? 👩‍💻

Head of Operations at Skupos in Denver, CO.
BDR at WorkHound in Chattanooga, TN.
Software Engineer at Vector AI in London, England.

Check out other jobs at Dynamo portfolio companies.

❤️ We would love your support. Please forward to friends and share on social media.
🗞️ If you were forwarded this and found it interesting, please sign up.
🎙 Check out Dynamo's podcast series, The Future of Supply Chain.

Maritime Emissions Regulations and Port Diversification with Eric Johnson

The Future of Supply Chain Episode #38

By: Santosh Sankar & Matt McHugh

In the latest episode of the Future of Supply Chain podcast, we sat down with Eric Johnson, senior editor of the Journal of Commerce Technology section. We discussed the 2020 IMO regulations and the impact they have on logistics carriers, port diversification across the United States, and the potential of carriers that partner with multiple transportation management system (TMS) vendors. 

Eric is an expert in technology as it relates to logistics. He earned his first degree in journalism, but after he began writing business-related articles at his first publication, he returned to school to study business. He started writing about the supply chain industry in 2011. 

Container Ship, Lake, Ship, Sea, Cargo, Frachtschiff

Source: Pixabay

IMO 2020 Regulations and their Impact on Maritime Carriers

Beginning January 1, 2020, the International Maritime Organization’s (IMO) new emissions regulations took effect. Essentially, the regulations require vessels to use lower-sulfur fuel to reduce emissions and increase sustainability. 

This issue has drawn attention because according to Eric, the change drastically affects the cost structure and availability of this particular type of fuel. 

“The big issue is that this is not like deciding at the pump that you want to use 89 octane fuel instead of 87,” he says. 

Eric shares concern with other industry leaders that the changes will actually lead to scarcity of the fuel, and that demand will drive up the price. In an attempt to save money, some carriers are having scrubbers installed on their vessels, rather than switching fuel types. This introduces a new set of problems.

“Scrubbers essentially capture the emission residue, and then that gunk is disposed of in the water,” he says. “Essentially, you're saying we're going to focus on cleaning emissions from the vessel to the air. But there's an offset that's negative as it relates to water and sustainability.” 

For now, scrubbers seem to be a temporary, stop-gap measure. 

“I don't think we're going to see scrubbers being a 10- to 20-year solution for this issue. I think the emissions mandates are only going to get stronger,” Eric says.

IMO 2020 has also raised questions about whether fuel costs will trickle down to consumers, and how dramatic the impact will be. 

U.S. Port Diversification

Over the past several years, carriers have begun trending away from West Coast ports and diversifying their port locations. Popular locations include the recently-widened Panama Canal and East Coast ports in the U.S. Cities such as Savannah, Georgia; Charleston, South Carolina; and Norfolk, Virginia are some of the locations that have seen a surge in maritime logistics business. 

The shift originated in 2002 with a longshore labor lockout at Los Angeles’s Long Beach. According to Eric, it “crippled the port for about 10 days.” Two years later, there was a similar issue that led to congestion of Long Beach’s container terminals and rail yards. The result was massive delays and vessels unable to call their terminals. 

After that, shippers began diversifying their port locations. 

“They started to think, ‘I can’t have all my eggs in one basket, where I’m not beholden to one port,’” Eric says. 

The diversification has led to broader distribution abilities. Carriers using the port of Savannah, for instance, are able to distribute to large parts of the inland U.S. 

The Panama Canal expansion also allows larger vessels to transit, leading to a larger allocation of containers. 

Technology and Automation at Ports

Historically speaking, port jobs are people-centric, and the unions work to keep them that way. Because of this, technology advancement in maritime logistics has been slow at best. 

“We’re seeing most of the technology at ports addressing the interface between terminals and carriers,” Eric says. “The sequence of vessels can be scheduled in a way that’s optimal for both the carriers and the terminals.

“Longshore unions on both coasts in the U.S. fight really hard to preserve jobs. They see automation as a threat to job numbers,” he says.

While technology might replace one set of jobs, it’s bound to open up jobs in other areas—whether that’s due to the need for tech workers or an expansion jobs due to trade. Still, Eric says that’s a hard sell for unions that have been doing jobs in-terminal long-term. 

“The question is, can you fit the desire to invest in automation and cool tech against the fact that there are people who are fighting to keep as many jobs unrelated to tech as possible?” 

To hear the full Future of Supply Chain episode featuring Eric Johnson, click here

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