Dynamo Dispatch (05/18/20)

Issue 107 | Vector AI, DispatchTrack, Shiprocket

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

Weekly Commentary 💭

If you’re looking to catch up on the Future of Supply Chain, I highly encourage you to check out the last couple episodes with Paul Noble of Verusen and Aaron Meredith of Georgia Pacific/Point A discussing startup/corporate engagement as well as Lance Theobald of SecurSpace chatting truck and trailer parks.

Stay safe out there!

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 📦

Americans Keep Clicking to Buy, Minting New Online Shopping Winners. Following shelter-in-place orders in March,  e-commerce penetration across the US has grown as much in 8 Weeks as It Had during the Past 10 Years. While some of this demand might just be driven by temporary changes to consumer habits, the major growth of grocery and food delivery suggests that both sectors are likely to emerge with significantly higher online sales post-pandemic. Echoing this sentiment, the Wall Street Journal anticipates Coronavirus Finishes the Retail Reckoning That Amazon Started.

COVID-19 Changed the Stakes for e-Commerce. Do Fulfillment Networks Need to Change Too? While previously a thorn in the side of many brick and mortar retailers, e-commerce today “is now an essential insurance policy — a way to keep sales from stopping entirely,” writes Emma Cosgrove at Supply Chain Drive. Just as coronavirus has spurred companies to embrace digital sales channels, the present risk posed by contagion to centralized fulfillment networks is forcing operational leaders to embrace on-demand warehousing to support their shift to distributed fulfillment configurations. 

Covering methods to make operations more robust and increase expense visibility, McKinsey looks ahead at the future of work in Jump-Starting Resilient and Reimagined Operations.

📊 Magic Quadrant for Multi Enterprise Supply Chain Business Networks. Given the exigence of end-to-end process planning and cross-team coordination, multi enterprise supply chain business networks (MESCBNs) are an essential technology enabling digitally mature companies to reduce cost and capitalize on opportunities. Offering connectivity and collaboration that exceeds the single-company focus of a standard ERP, MESCBN leaders include Infor and E2open whom Gartner appraises alongside challengers like IBM and OpenText in its comprehensive assessment of industry players. Meanwhile, 34% of financial leaders polled by PwC have automation top-of-mind as Key to Supply Chain Agility Post Pandemic. Also, in autonomy: Delivery Robot Operators Are Also Working From Home.

Uber Approaches Grubhub with Takeover Offer. Deliberations are ongoing for a possible consolidation that could account for as much as 55% of the food delivery market. While likely to draw antitrust scrutiny, the acquisition could also reduce cash burn for the Uber Eats unit, which has remained largely unprofitable amidst steep competition from leading rival DoorDash. Despite much of America being stuck at home, Food-Delivery Companies Still Struggle to Profit. Meanwhile, New York City Moves to Limit Fees from Meal-Delivery Apps

How VR, IoT, AI, and Big Data Power UPS's Digital Transformation. From the use of virtual reality for training to big data Network Planning Tools (NPTs), just a short visit to UPS Worldport in Louisville reveals the heavy tech investments at the world's largest automated sorting facility. As Bala Ganesh, Vice President of the Advanced Technology Group, observes, "Some of the new technology will work, and some won't, but we're putting our chips on the table and starting to see some returns." For related insight into 3PL’s innovation outlook, listen to FedEx CEO Frederick W. Smith Talking Business, the Economy and COVID-19

Maersk: Container Volumes Could Fall 25%. Despite grim predictions for Q2 container volumes, Maersk feels well-positioned to weather the fallout of coronavirus. Having already blanked more than 90 sailings in Q1 to reduce variable costs, the Danish shipping giant plans to continue reducing capacity as necessary. Nevertheless, year-over-year shipping revenues have been up 3% through the pandemic. In other news for the company, Maersk Launches Its First Rail Service from China to Turkey. Meanwhile, rival CMA CGM Secures $1.14B Loan and State Guarantee.

Apple Supplier Responsibility 2020 Progress Report. From its base in California, the technology giant oversees a globe-spanning supply chain throughout which the iPhone maker has sought to add face masks, health screenings, and deep cleaning protocols. “Our teams have also partnered with suppliers to redesign and reconfigure factory floor plans where needed and to implement flexible working hours — including staggered work shifts — to maximize interpersonal space,” writes Sabih Khan, senior vice president of operations.

Mobility 🚗

Elon Musk Wins Battle with Alameda County: Tesla Factory Allowed to Reopen. Following threats last week by Musk that he would move Tesla production out of California, local officials have reached a detente with the billionaire founder. The Alameda County Health Department has affirmed that operations at the Fremont plant could resume as early as next week so long as Tesla can safely ensure social distancing among its workers. Related, A Look at Tesla's Neural Net Training Techniques while Voyage Partners with Fiat on AV Vans.

US Automakers Set to Reopen Amid Virus, Mexico Hurdles. Plexiglass dividers, temperature checks, and face shields are but a few of the safety protocols that Detroit automakers are following as they prepare for plants to reopen on Monday. However, concerns abound on both sides of the border as economic and health officials send mixed signals about the “essential” nature of car manufacturing. With the industry already in flux when the pandemic hit, The Loadstar predicts Automotive Supply Chains Face a Long Road to Recovery as Production Restarts.

China Auto Sales Snap Long Falling Streak, but Growth May Be Short-Lived, China’s auto market in April grew 4.4% over the previous year, snapping 21 consecutive months of declines. The good news, however, is likely short-lived as the April numbers reveal that sales of passenger-cars declined 2.6% versus commercial vehicles rising 32%, suggesting the boost comes more from government stimulus than consumer demand. Looking at the US, AutoNation CEO argues there is 'No Turning Back' From Online Car Sales.

Archrivals Uber and Lyft Must Join Forces to Survive. With ridership falling almost 70% and regulators placing even more scrutiny on the two ride hail companies, Byrne Hobart argues that Uber and Lyft should pursue a comfortable duopoly akin to Coca-Cola and Pepsi or Kellogg and General Mills. By emphasizing profitable equilibrium in place of cut-throat competition, the two companies together can ensure their survival through the coronavirus and impending court cases. Meanwhile, the two companies have announced New Safety Requirements For Drivers

Cities Are Transforming as Electric Bike Sales Skyrocket. From Seattle to New York, cycling rates are up 5% nationwide since the onset of the pandemic. As more cities experiment with road closures to allow social distancing, it is likely that the American urban environment could witness a permanent shift towards more pedestrian-friendly policies after quarantine. The Atlantic welcomes this future in advocating Don’t Close Parks. Open Up Streets. Also, see Sidewalk Widths NYC for a neat visualization of just how much space New Yorkers are typically confined to. 

Boeing Orders Slip Below 5,000 on MAX Cancellations. For the first time in seven years, the order book of the jetliner has dropped below 5,000 as more than one hundred orders of the manufacturer’s 737 MAX jets have been canceled. Acknowledging the near term hardship, Chief Executive David Calhoun does not anticipate passenger traffic reaching 25% of pre-COVID levels until September at earliest. However, by appointing its vice president of digital transformation Mike Delaney to lead its ‘Confident Travel Initiative,’ Boeing Has a Plan to Get People Back on Planes. 

By the End of May, Most World Airlines Will Be Bankrupt. Sounding the alarm on behalf of airlines, the CAPA Centre for Aviation calls for coordinated government and industry action to avert catastrophe. Advocating for a new global safety regime, the Centre argues that intergovernmental coordination is necessary to prevent protectionist government responses and to reconsider regulations like cabotage that could make airlines more robust post-pandemic. A quick primer for the worst-case scenario: What Happens To Your Miles When An Airline Declares Bankruptcy.

Fundraises, M&A, Talent 💸

💥 Vector Raises Seed Round. Based in London, Dynamo portfolio company, Vector has developed a platform powered by computer vision to convert supply chain and financial documents into a “digital fabric” that can be leveraged throughout international trade workflows. The round was led by Episode 1.

Intello Lab Raises $5.9M Series A Led by Saama Capital. Leveraging computer vision and artificial intelligence, the Indian startup helps standardize quality assessment within agricultural supply chains. The new funding will be used to accelerate growth across Asia Pacific and the US. 

Shiprocket Raises $13M Series C Led by Tribe Capital. The New Delhi-based startup serves as a logistics aggregator for the nation’s growing direct-to-consumer brands. The company, which said it was profitable for the financial year that ended 31 March 2019, plans to use the new capital to help drive its overseas expansion. 

VanMoof Raises $13.5M in Round Led by Balderton Capital and SINBON Electronics. Started in 2009, the Dutch e-bike startup has received its fresh capital injection just as many cities around the world have been doubling down on cycling infrastructure. The funds will support international expansion following the launch of the new electric VanMoof S3 and X3 bikes.

Wallbox Completes Second Tranche Of $25M Series A. The Spanish startup manufactures electric car chargers for personal residences. Leading the round was Seaya Ventures with additional investment from Endeavor Catalyst and existing investors such as Iberdrola.

DispatchTrack Secures $144M Growth Investment Led by Spectrum Equity. Based in San Jose, the last mile technology companies offers a platform for self-scheduling, dynamic route optimization, and delivery performance analysis. Accepting outside funding for the first time in the company’s ten year history, DispatchTrack plans to use the investment to support innovation and expansion. 

Waymo Raises an Additional $750M. Following the $2.25M that the Alphabet subsidiary raised in March, Waymo announced this week it had padded its war chest even further as it raises to deploy its autonomous vehicle technology. Investors this time included Perry Creek Capital and units of T. Rowe Price and Fidelity Investments

Company Building 🛠️

Hiring 10x Execs. “I want you to intimately know my strengths and weaknesses, and I want to know yours as well. I will share my last 360 review with you so we can discuss it on our next chat, and I’d like you to share yours with me. I know it won’t be perfect and some parts may be unfair. I’m just looking for you to walk me through it so we can discuss.”

Importance of GtM Innovation from CEO of Hashicorp. So often we see founders focus acutely on a great product but neglect the go to market. It’s important to build both in concert and understand the deep relationship between what one is building and how they need to sell it.

Invest Like the Best: Tobi Lutke on Building a Modern Business. In our humble opinion, Lutke is artfully building Shopify into a viable Amazon competitor while developing key capabilities around the eComm supply chain (ex: 6 River). This is worth the entire listen with special attention to his thoughts on quality, being without process, and scaling.

Who's Hiring? 👩‍💻

Product Manager at Vector AI in London, UK.

Digital Marketing Intern at SVT Robotics in Norfolk, VA.

Software Engineer at Stord in Atlanta, GA.

Check out other jobs at Dynamo portfolio companies.

💥 Have you seen any interesting startups recently? 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.