Dynamo Dispatch. A 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 đ
We ended April with some exciting newsâŚZeelo was acquired by Swvl! Weâre proud of the hard work that the team at Zeelo put in to get the company where it is today and are honored that we were able to offer support along the journey. More on the acquisition below in the M&A section.
Big shoutout to Paul Noble, CEO of Verusen, for being nominated by Ernst & Young as a finalist for the Entrepreneur Of The YearÂŽ 2022 Southeast Award. Congratulations!Â
Shoutout toÂ
We Are Dynamo,
Clay, Santosh, Jon, and the rest of the Dynamo team
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Supply Chain đŚ
UPS Encounters Unexpected Drop In Parcel Volumes As eComm Growth Slows. UPSâ average US daily volume fell 3% y/y following the slowdown in commercial delivery growth due to a drop in residential packages. The decline, equal to 611K packages daily, was 500K pieces greater than the parcel carrier expected. Despite the volume decline, UPSâ per-package revenue increased by 9.4% as the company continues to follow its strategy of pursuing more profitable deliveries. Despite the slowdown in eComm growth, Rising Inventories Are Reshaping Inland Distribution and eyes are on any potential alternatives for consumers, such as Metaverse Commerce.
Industrial Real Estate Market Conditions Remain Tight And Space In Short Supply. The ongoing theme of demand exceeding supply within the industrial real estate market remains intact. During its Q1 report, CBRE reported a vacancy rate of 3.1% and the average asking rent rose 11.8% y/y to $8.94 per ft2 â a new record-high. In addition, the company reported that construction completions came in at 62% pre-leased, rising 27.5% y/y but down 27.8% compared to 4Q21, showing how tight market conditions lowered absorption compared to 1Q22. Although ongoing challenges worsen concerns over industrial logistics, innovations such as Supply Chain Digital Twins keep pushing new boundaries for the industry. For more information on innovation within factories, read a recently published Report On Digital Factories.Â
Chinaâs COVID Crisis Threatens Global Supply Chain Chaos for Summer 2022. Chinaâs stringent rules to curb COVID are about to unleash another wave of summer chaos on supply chains between Asia, the US, and Europe. Shipping congestion at Chinese ports, combined with Russiaâs war in Ukraine, risks a one-two punch that threatens to derail the recovery, already buffeted by inflation pressures and headwinds to growth. For reference, China accounts for about 12% of global trade and the pileups mean more costly headaches in the $22T arena for global merchandise trade. Longer-term, such chaos is redrawing the contours of a global economy tied together by cross-border commerce. For more news on Chinaâs impact on global supply chains, see Trans-Pacific Forwarders And Carriers Brace For Post-China Lockdown Surge and Chinese Lockdowns Risk Factory-Driven âBullwhipâ.
đBank of America Sees Trucking Demand Near Recession Levels. Shippersâ outlook on rates, capacity, and inventory levels are matching attitudes not seen since May and June 2020, when pandemic lockdowns sent freight volumes into a historic decline. Bank of America released a research report on trucking, where it explained that shippersâ view of demand is down 23% y/y, with the bankâs proprietary Truckload Demand Indicator hitting 58 â the lowest since June 2020. Meanwhile, shippers are finding it easy to locate capacity to move their load with outlook on capacity hitting its highest level since June 2020. They also noted their view on inventory levels had climbed to its highest point since May 2020. For more information on the status of the US trucking industry, see GDP, Contract, Spot Slide Downhill and how Crowdsourcing Offers A Solution To Truck Driver Shortage.Â
Shippers Press Regulators To Intervene As Rail Service Challenges Mount. Shippers are sounding the alarm over major declines in rail service, pushing regulators in an emergency hearing to intervene as long delays and labor constraints threaten to shutter operations. Service issues in the rail industry threaten to exacerbate supply chain headaches that have already raised costs and created major shipping delays for producers. Missed switches and other delays have straddled agriculture producers and others that rely on rail with more fees and higher costs. For reference, unfilled grain orders are the highest on record, creating cascading effects along the supply chain, while other businesses note that rail service issues have led to production outages. Separately, news has mounted on the maritime supply chains regulatory space following Industry Associations Calling On Congress To Bring Ocean Shipping Reform Act To Conference and Rising Ocean Shipping Costs To Bring Wave Of Higher Prices.
Walmart Expands Support For Indian Third-Party Sellers. The discount giant, which began inviting select Indian sellers to apply to join Walmart Marketplace in January 2022, is seeking to bring 40K new sellers onto the Marketplace platform this year. Walmart also plans to expand its Marketplace assortment to offer over 200M items, from its current selection of nearly 170M products. The company says it sees particular potential for India-made products in popular categories like furniture, bedding, and home dĂŠcor on Walmart Marketplace. Walmart plans to increase its sourcing from India to $10B worth of merchandise a year by 2027. For a change of pace, see how Amazon 3rd-Party Delivery Solutions With Buy with Prime is expected to cause Major Changes In Shopifyâs Business as Amazon-as-a-service emerges beyond aggregation.Â
Flexport: How to Move the World. The $182B freight forwarding market is fragmented, with DHL boasting the biggest share at 6% and 60% being controlled by players outside the top 20. Many incumbents have been slow to adopt technology, allowing Flexport to upend the space by creating a modern platform that offers visibility and control over the freight forwarding process. Moving forward, the company has bigger ambitions: building a global trade platform that offers accurate, real-time data for the entire industry. On the one hand, supporters argue that Flexport has a leg up when it comes to building its global trade platform. However, others believe that the different incentives of the freight forwarding division compared to the platform team would make Flexport struggle to keep them siloed as Container Delays Expected To Last Through 1H2023. For more news on simultaneous innovation in the space, see how Hapag-Lloyd's Box Tracking Salvo Is Expected To Be An Industry-Wide Catalyst.Â
Mobility đ
Heat Pumps Included in GM EVs Could Give Them a Real-World Range Advantage. GM announced Monday plans to incorporate heat pump tech into its Ultium-platform EVs. The tech could potentially extend vehicle range by 10% and make GM more competitive in the EV market. The system could potentially have the added bonus of increasing passenger comfort with its temperature control features. In other news, consider reading Mary Barra Says GM Will Begin Tying Executive Compensation To Success Of Its EV Targets and 62% Of 2017 To 2019 Chevrolet Bolts Have Had Their Battery Replaced.Â
đUSDOT Announces $6.4B Programme to Reduce Carbon Emissions. The Carbon Reduction Program will allow states to expand their transportation investments in an effort to reduce carbon emissions. As a part of the program, states are required to create long-term plans for reducing emissions in their area. The funding will be used to build EV and AV infrastructure as well as micromobility. In other news, Electric Car Sales Surge Despite Rising Battery Costs and Ford Teases A Second Electric Pickup Truck.
GM Expects To Spend $2B On Cruise In 2022. GM continues to spend significant resources on its AV unit, incurring losses of $325M in Q1. The company expects to provide robotaxi services 24/7 to the entirety of San Francisco in the near future. GM also expects its AV venture to be incredibly profitable by the end of the decade which would equate to an expected $50B in annual revenue. As weâre seeing increased AV investment all across the industry, especially with Tesla announcing their upcoming robotaxi project, itâs becoming increasingly clear that ride-hailing is on the brink of disruption. In related news, check out How Good Is Porsche's Autonomous System and VW Considers Building Second Plant In The USA.
Are Bidirectional EV Chargers Ready For The Home Market? Despite the increasing amount of interest and investment from various players in the EV industry, the current viability of bidirectional EV charging is still up in the air. One of the bigger hurdles will be establishing proper safety protocols to ensure it doesnât have any adverse effects on the nearby grid. Another potential problem that will need to be resolved is that the cars will need a smart enough inverter to accommodate the current rushing towards the house. These arenât unsolvable problems but will require the corresponding investment and potential increase in cost. In related news, check out The Global Lithium Podcast with Simon Moores and How To Build A Better Magnet.
Pilot Shortages Will Buffet Americaâs Airlines. American Airlines is expecting to put in place changes that will result in travel delays for many customers due to staff shortages. The number of pilots employed has dropped by 4% since the pre-pandemic peak. As passenger demand for flights has rebounded, the airlines are struggling to meet demand. An offset of this is that the annual salary of the average pilot has risen 30% to match the lack of supply. For related information, consider reading Airlines That Dropped Mask Requirements Are Now Suffering Staff Shortages Due To COVID and Delta Air Lines To Start Paying Flight Attendants During Boarding.
For Connected Cars, An Evolving EU Regulatory Landscape. The EU is starting to create a new regulatory framework for data and AI. This could have big implications for CAV development in Europe. The various policies being considered will influence how much automakers will be required to divulge regarding data collection and usage as well as the freedom automakers will have to allow third parties to use collected data. The consultation will run until June 21, writing legislation that will impact the next decade of CAV tech. In other news, Baidu, Pony.AI Win First Driverless Robotaxi Permits In China.Â
Southeast Asia Travel Is Catching Up At Last As COVID Curbs Ease. Travel searches in SE Asia have risen around 20% since the last week of March. Various areas in the region are seeing a big increase in travel and subsequently foreign investment from a rebound in tourism. This is overall good news for various stakeholders as travel rebounds back towards its pre-COVID heights. For related information, check out, Five Places Business Travel Has Changed Post-Pandemic and This Week In Travel: Mask Mandates And Tourist Tax.
Fundraises and M&A đ¸
đĽ Swvl Acquires Zeelo for $100M. Swvl, an Egyptian startup that provides shared transportation services for inter and intra-city trips, has acquired Zeelo, UKâs largest smart bus platform aimed at manual workers and students. This acquisition enables Swvl to expand into the UK, South Africa, and the US via Zeeloâs footprint. The acquisition is expected to be completed in May 2022.
DriveX Raises $1M Led By DEPO Ventures. DriveX uses AI-assisted technology to digitize the vehicle inspection process. The startupâs current customers include the likes of BTA from the Vienna Insurance Group, ERGO from Munich Re, and BALTA from the PZU Group. The funds will be used to expand product offerings and operations across Europe.
GoRamp Raises âŹ1.5M. GoRamp provides a platform that helps manufacturing, retail, and production companies digitize their logistic operations. The startup claims its platform eliminates 70% of operational work, increases 20% of warehouse loading efficiency, and decreases up to 25% of logistics costs for its users. The funds will enable the company to expand to Western Europe and the US.
Route Reports Raises $3.25M Seed. Route Reports is a transit tech and analytics startup based in the UK. Investors include Urban Innovation Fund, Trucks Venture Capital, and Burst Capital. The funds will enable the company to expand in the US.
Oware Raises $3.3M Pre-seed. Oware is a network of connected warehouses that let businesses track and manage shipments from a single portal. Investors include Flexport Fund, Ratio Ventures, Seedstars International Ventures, Sketchnote Partners, The Osiris Group, Swiss Founders Fund, Reflect Ventures, +92 Ventures, and Walled City Co. The company currently has 18 warehouses across 5 cities in Pakistan, with a total space of 500K ft2.
GridMatrix Raises $3.5M Led By 8VC and Cota Capital. GridMatrix's cloud platform for traffic analytics combines edge sensor data with cloud-based data sources to eliminate urban traffic congestion, accidents, and emissions. GridMatrix is a member of Amazon's GovTechStart accelerator and Qualcomm's Smart Cities accelerator. Based in San Francisco, GridMatrix was co-founded by a team of former Apple engineering and operations colleagues in January 2021.Â
Bounce Raises $12M Led By Andreesen Horowitz. Bounce provides luggage storage for travelers and tourists in cities across the world. The company claims it was able to continue growing its business during the pandemic â saying it paid out more than $1M to local businesses during the pandemic despite COVIDâs impact. The funds will be used to scale across Europe while expanding its service offerings.
Food Rocket Raises $25M Led By Circle K Venture Fund. Food Rocket is a 15-minute grocery delivery startup. The company has taken an unconventional route, striking a funding deal with Circle K parent co. that enables it to deliver in 26 countries, including more than 7K US locations.
Pyka Raises $37M Led By Piva Capital and Prelude Ventures. Pyka is building electric autonomous airplanes. They are working on a cargo-carrying Pelican that will be able to carry 400 pounds of payload up to 200 miles. The company is aiming for the first flight of its cargo plane in four months. The funds will go towards boosting manufacturing capabilities.
Eurora Raises $40M Led By Connected Capital. Eurora helps combat eComm shipping delays by automating tax, shipping compliances, and customs services. The company recently raised $3M about 9 months ago. The funds will be used for geographical expansion in the UK, US, and Middle East.
Neuron Mobility Raises $43.5M Led By GSR Ventures and Square Peg. Neuron Mobility is a Singapore-based eScooter and eBike operator. Since Neuron Mobilityâs last funding round 19 months ago, the company has more than tripled its operations, growing from seven cities in September 2020 to 26 cities today. The funds will be used to fuel rapid international expansion.
VisionNav Robotics Raises $76M Led By Meituan. VisionNav builds autonomous forklifts, stacking vehicles, and other logistics robots. VisionNavâs valuation was boosted to over $500M in this round, up from $393M just six months ago when it picked up $47M in its Series C. The funds will be used to invest in R&D and broaden its use cases.
FreeWire Raises $125M Series D. FreeWire is an EV charging and energy management platform. Investors include BlackRock, bp ventures, Riverstone Holdings, Octave Ventures, Gly Capital Management, Blue Bear Capital, and Daishin Private Equity. The funds will be used to accelerate the deployment of its technology to meet growing demands.
Cavnue Raises $130M Led By SIP and Ford Motor Company. Cavnue is building the worldâs most advanced road network for connected and autonomous vehicles. The company is also developing a digital twin of existing roadways that will allow Cavnue to test and demonstrate what real-world deployment of our technologies will look like, virtually. The funds will be used to drive innovation and accelerate its project pipeline.
Kinexon Raises $130M Series A. Kinexon is an IoT automation and location analytics company. Its hardware and cloud-based software are used by industries such as manufacturing, logistics, and sports to track the movement of humans and objects. The funds will be used to accelerate the development of its automation technology and expand across North America and Europe.
Divergent Technologies Raises $160M Series C. Divergent Technologies is revolutionizing the automotive industry through 3D printing. Utilizing its automated automotive assembly platform that combines 3D printing with generative design, Divergent has already committed to building the 1,233 bhp 21C hypercar for sister firm Czinger, which ships next year. The funds will also enable the company to expand its operations and meet growing demands.
Swvl Acquires Volt Lines For $40M. Swvl, an Egyptian startup that provides shared transportation services for inter and intra-city trips has acquired Volt Lines, a B2B transportation-as-a-service operator. This acquisition enables Swvl to build out its corporate offerings while getting a foothold in Turkey. The primarily stock deal was valued at around $40M.
FLASH Acquires Ticketech. FLASH, a cloud parking software and mobility company, has acquired Ticketech, a parking technology company in New York. FLASH will accelerate Ticketechâs technology innovations and operations, in addition to investing and expanding the NY-based team to help Ticketechâs customers tackle New Yorkâs unique mobility challenges. The terms of the deal were not disclosed.
Tenstreet Acquires Vnomic and True Load Time. Tenstreet, a platform that connects carriers and drives has acquired Vnomics, a fuel optimization solution, and True Load Time, a load-time management technology. The acquisitions augment Tenstreetâs retention and engagement services by reducing the friction drivers encounter while also increasing profitability for carriers. The terms of the deal were not disclosed.
SPAC RadarđĄ
Hudson Acquisition Files For $60M IPO. Hudson Acquisition is a blank check company targeting financial technology, consumer technology, medical technology, and advanced mobility technology companies in the US. The company plans to raise $60M by offering 6M units at $10. At the proposed deal size, Monterey Capital Acquisition would command a market value of $80M.
Monterey Capital Acquisition Files For $100M IPO. Monterey Capital Acquisition is a blank check company targeting cleantech companies including EVs with valuations between $250M and $1B. The company plans to raise $100M by offering 10M units at $10. At the proposed deal size, Monterey Capital Acquisition would command a market value of $127M.
Business Building đ ď¸
SMB SaaS Benchmarking Guide. From Lightspeed Venture Partners, this is a nice reference guide for founders trying to understand what great vs good looks like as they sell to SMBs. In supply chain, this is especially relevant for an increasing number of companies trying to sell into the âlong tail.â
The 2022 B2B Marketplace Funding Napkin. Point9 has updated its fundraising benchmarks for B2B marketplaces. Note that a lot of the valuation data is reflective of the 2021 funding environment, as things have slowed, it will be interesting to see what expectations are like with regards to valuation and underlying traction.
Scaling Tech and Building Teams. âHow to create a performance culture? Up to your first 100 people, you need people who just love what they do and are in it for the career, not just the day job. Beyond that, you have to evolve your modelâŚâ
Who's Hiring? đŠâđť
Technical Product Manager at Plus One Robotics in San Antonio, TX.
Software Engineer, Applications at VIZION in Atlanta, GA (remote ok).
Flight Operations Lead - USA at Manna in Dublin, Ireland (remote ok).
Thatâs all folks!