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 💭
Hello from Chattanooga! We were supposed to be in Long Beach this morning but the ongoing coronavirus concerns required the JoC to cancel TPM/El Dorado on Saturday evening. A big shout out to Peter, Eric, and the JoC team given the hard work they put in year round prepping for container trade’s hallmark event.
The coronavirus continues to roil global trade, capital markets, and most importantly, society. If you’re looking for operating advice related to COVID-19, see here.
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 Is Quietly Working on an Amazon Prime Competitor Called Walmart+. It’s taken Walmart 15 years to catch up, but the company now looks to begin testing its own membership-based delivery program as early as next month. Rumors are circulating around the details of supposed Walmart+ perks that Amazon cannot compete with. However, nothing is confirmed yet and this may as well be an attempt to join the subscription race with more froth than substance. Related, Walmart to Combine Online and Store Product-Buying Teams. Elsewhere in retail, Home Depot Opened a Dozen Last-Mile Facilities With More Than 100 to Come.
🌟Manna: Ice Cream and Thai Food Are About to Fly Through Irish Skies. Dynamo portfolio company Manna hit the ground running this week with the launch of its University College Dublin pilot in partnership with Ben & Jerry’s, Just Eat, and Camile Thai. Founder, Bobby Healy, expects to make between 20K and 50K successful deliveries by year-end. “In five years, it’s going to be the most normal thing you can imagine.”Related, Food Delivery Wars: 3 Takeaways From The UberEats, Postmates, Grubhub, DoorDash Ecosystem.
For Warehouse Robotics, the Dock Is the Final Frontier. The laborious task of loading and unloading hundreds of heavy boxes makes the loading dock an area of high employee turnover. Still, the fragility and variability of the items involved present a bigger barrier than potential ROI for robotics solutions at this point in time. Humans still have the financial edge here, and robotics investments elsewhere within facilities still represent greater ROI potential for the foreseeable future. Amazon brought warehouse robotics mainstream and Morgan Stanley Expects the Same of One Day Prime.
China Pushes Factories to Reopen, Risking Renewed Virus Spread. Central and local Chinese governments are lowering the threshold for factories to resume operations as pressure to resume economic activity mounts. China’s economy was estimated to be running at about 50% to 60% capacity last week. Official statistics noted that more than 70% of plants in provinces such as Shandong and Jiangsu have now resumed operations. Related, Shippers Turn to Air Freight as Chinese Factories Come Back Online.
MIT Researchers Create ID Chip to Help Combat Losses to Counterfeiting. The 1.6 square millimeter-sized, battery-free, cryptographic chip can authenticate nearly any product and only costs a few cents to produce. $2T worth of counterfeit goods are expected to be sold this year around the world. This comes as TQL’s Cyber Breach Illustrates the Industry's Vulnerability.
Up to 91% More Expensive: How Delivery Apps Eat Up Your Budget. This test took a small sample of two orders but meaningfully showed an average markup of 50% by delivery apps. Grubhub’s markup was by far the lowest at about 25%, while UberEats was the highest. On the topic of food delivery, NY City Council Proposes Wide-Ranging Third-Party Delivery Marketplace Regulations,
DP/DHL Scrap Electric Vehicle Built with Ford. DP reported that the company had suffered years of losses from developing and producing its StreetScooter EV — racking up losses of $110M just last year. Daimler and VW can take a breather as production will cease later this year, resulting in writedowns of between $300M and $400M.
Uber Freight Partners with Samsara. Uber Freight will actively promote Samsara’s ELD and trailer tracking solutions through select discounts to eligible fleets with 6+ vehicles: $50 discount per ELD and $20 discount per trailer tracker. Speaking of connected truck hardware, Telematics Converging for Truck OEMs and ELD Providers.
Mobility 🚗
Europe’s Warring Ride-Sharing Startups Vie For Elusive Supremacy. Facing strong headwinds from local governments, Europe’s ride-hailing apps are encouraged to diversify their footprint into new continents and more profitable services like scooters and bike shares. In addition to Spain’s Cabify and Germany’s Free Now is an Estonian unicorn: How Bolt Bounced Back from a Spectacular Public London failure. Related, Lyft Ramps up Self-driving Program.
📊California DMV Releases 2019 Disengagement Report. A survey of all licensed autonomous vehicle operators, the report details both total miles driven as well as ‘disengagements’ — instances where a human driver had to take the driving wheel. Baidu led the pack in miles driven, followed by Waymo and Cruise. However,
Self-Driving Car Companies Complain California Test Data May Mislead.
🌟Cruise Obtains California License to Transport Riders with Safety Drivers. The California Public Utilities Commission (PUC) has granted a permit to GM’s Cruise for passenger services in its autonomous Chevrolet Bolts. Separately, NHTSA Slams Brakes on Self-Driving EasyMile Shuttles After Passenger Injury.
Inside a Secretive $250M Private Transit System Just for Techies. More than 1,000 private commuter buses operate in the Bay Area with approximately 50K tech workers shuttling to and from tech campuses. Carrying more people than some public agencies, critics now fear these shuttles are diverting attention from more inclusive investments in public infrastructure.
Suckers List: How Allstate’s Secret Auto Insurance Algorithm Squeezes Big Spenders. An investigation into Allstate’s risk calculation finds the insurance giant tweaked its algorithm in an attempt to hike rates and deny discounts to thousands. In Maryland alone, the lost discounts to customers would have added up to more than $10.5M in 6 months.
📊Transportation Is 'Climate Enemy #1’: Report.With transportation representing the largest source of greenhouse gas emissions in the U.S, the Environment America Research & Policy Center and the Frontier Group put forth recommendations for vehicle electrification and doubling the number of people who travel by walking, biking or taking transit. Related research finds Uber and Lyft Generate 70 Percent More Pollution Than Trips They Displace.
The Richest Countries Have the Fewest Road Deaths. Analysis by the Institute for Health Metrics and Evaluation finds worldwide trend of road-death rates declining when countries reach GDP per capita of $30K. Well-engineered roads and well-maintained vehicles are suggested to be more important than miles driven. Related: Tesla Autopilot, Distracted Driving to Blame in Deadly 2018 Crash.
Airlines' Revenues Set to Take a $30B Hit Due to Coronavirus. According to the International Air Transport Association, the airline industry can expect a $29.3B drop in revenue as a consequence of the coronavirus outbreak. China alone faces a $12.8B loss in its domestic market.
Montréal Says No to Kick-Scooters. After a 90-day trial period, Montreal bans e-scooters from the city. Erratic driving, poor parking, and a lack of helmets were cited by lawmakers as reasons to disband the project. Related observations from Lime’s Head of North America Government Relations: We Pulled our Scooters Out of a Dozen Cities. Here’s What Cities Can Learn From That. Also, Bird Is Testing Bird Pay, Which Lets Users Purchase Items From Local Businesses.
Fundraises, M&A, Talent 💸
Grab Raises $856M in New Round from MUFG and TIS. The Southeast Asian ride-hail app doubles down on financial services offerings including payments and small business lending. Rumors swirl that it might also be preparing for a merger with its largest regional rival.
Toyota Leads $462M Round for Pony.ai. Based in Guangzhou and Freemont, California; the autonomous driving startup is one of only a handful of companies to secure AV testing licenses in both China and the US. Pony’s total valuation now rises to over $3 billion.
Kraft Heinz Venture Arm Invests in Fabric. Evolv Ventures, a $100M venture fund backed by Kraft Heinz, participates with an undisclosed investment in $110 million funding round for Fabric. An automation and robotics startup now based in New York, Fabric specializes in micro-fulfillment centers enabling same day deliveries.
Flock Freight Raises $50M Series B Co-led by SignalFire and GLP Capital Partners. The Solana Beach startup matches less-than-truckload and partial-truckload freight shipments so they can be shipped via a full truckload service. The team plans to use the fresh capital to further develop its AI-driven marketplace.
Descartes Acquires Peoplevox for Approximately $24.5M. The Canadian logistics software company picks up Peoplevox, a cloud-based e-commerce warehouse management solutions provider from the UK. The purchase follows Descartes’ prior acquisitions of ShipRush in 2017 and Oz Development in 2015.
Cityscoot raises €23.6M Series C co-led by Demeter and Allianz France. The French startup provides a free-floating electric scooter service with operations already live in Paris, Nice, Milan and Rome. Existing investors Groupe RATP and Banque des Territoires also participated.
Dahmakan Raises $18M Series B Led by Rakuten Capital. Also participating in the round were White Star Capital, JAFCO Asia, GEC-KIP Fund, and Woowa Brothers. The cloud-kitchen startup plans to use the capital infusion to further develop its in-house operating system.
Sokowatch Raises $14M Series A Led by Quona Capital. The Kenya-based startup enables on-demand ordering, delivery, and financing of goods to informal shops. The company plans to use the fresh injection to fund development of more client services as well as regional expansion.
Dray Alliance Raises $10.2M Series A Led by Matrix Partners. Other investors include Moving Capital, Craft Ventures, Act One Ventures, and Wonder Ventures. The LA-based drayage marketplace plans to use the new funds to hire out its team as it looks to digitize the $50B port logistics market.
Olea Edge Analytics Raises $9M Series B Led by Renewal Funds. The Austin-based company provides AI-enabled IoT water distribution management solutions for municipal water utilities. Existing investors Ananta Family Office and Mercury Fund also participated in the round.
Sensible 4 Raises $7M Series A Led by NordicNinja VC. The Finnish startup builds autonomous driving software for inclement weather such as snow, fog, and heavy rain. The fresh funds will support software development and market entry to China and Japan later this year.
OneRail Raises $5.8M in Seed Round Led by Las Olas Venture Capital. Also joining the round were Chicago Ventures and Alpine Meridian Ventures. The Orlando-based startup provides deep enterprise integrations for comprehensive logistics and exceptions management.
Cioplenu Raises €4.2M Seed Round Led by Cherry Ventures. Styled as a SaaS for “deskless” workers, the German startup helps digitize production floor processes including maintenance, assembly, and inspection. With the fresh injection the team plans to triple its headcount and open a second office in Frankfurt.
DoorDash Files for IPO. The US market leader in digital food delivery, DoorDash captured approximately 38% of food delivery sales in January, according to Second Measure. The company was valued at approximately $13 billion during its latest round of funding in November.
Lion Air Delays IPO Amid Global Stock Market Decline. Sources say the Indonesia-based budget airline plans to wait until markets stabilize before proceeding. The eventual float is expected to bring in $500 million for the Southeast Asian carrier.
Company Building 🛠️
Google Research on Effective Teams. “The researchers found that what really mattered was less about who is on the team, and more about how the team worked together.”
🎧BC Startup Sales Podcast: Outbound 3.0 with Jason Bay. For those ramping outbound or just wanting to improve their existing outbound, this podcast is a great listen. Some gems around personalizing emails, not being assumptive, and when to ask for the first meeting.
🌟The New Business of AI. Frank Chen of a16z is very asuste in his observation that AI companies have different sales, margin, scaling, and defensibility attributes making them a markedly different business from traditional software or services.
Who's Hiring? 👩💻
Senior Backend Engineer at Vector AI in London, England.
Front End Developer at SVT Robotics in Norfolk, VA.
Product Manager at Verusen in Atlanta, GA.
Check out other jobs at Dynamo portfolio companies.
💥 Seen any interesting startups or have any tips for the Dispatch? Introduce us.
❤️ 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.