Dynamo Dispatch (06/08/20)

Issue 109 | Poka, Locus, Beacon

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 💭

We’re living through a period unlike any other in the US and like others, we’ve been reflecting and doubling down on our efforts to raise our own awareness, promote equality, and continue to find new ways to support the build-out of a better society.

Our door is open to ALL Founders building a startup in supply chain or mobility. We are here for you and it’s an honor to hear about your vision and ambition for your startup.

May we come out of this period with less injustice, greater equality, and a more unified spirit.

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 📦

Postal Package Deliveries ‘Bogged Down’ With Delays, Backlogs. With holiday-level volumes overwhelming distribution centers, the US Postal Service has been struggling to meet its service level agreements amidst the pandemic. Between April 19 and May 23, USPS delivered 89.5% of its priority mail packages on time which puts it on par with FedEx Ground at 86.9% but far short of UPS’s 96.5%. As a testament to the strain they are under: FedEx Follows UPS with Peak Surcharges beginning Monday. Meanwhile Onfleet breaks down The True Costs of Last Mile Delivery

What Apple Learned From Automation. In 2012, Foxconn Technology (Apple’s largest outside manufacturer) had predicted that within 2 years its warehouses would be using over 1 million robots to assemble Apple products. As of last year, its robots totaled a mere 100,000. One of the key lessons for the tech giant has been the realization that often humans are more flexible and easier to reassign than their robotic counterparts. Due to Apple’s aggressive product timetables, automation was expected to pay for itself over two years (in stark contrast to automotive robots which can spread the cost over a decade). ICYMI, Dynamo portfolio company, Plus One Robotics Integrates with MSC Industrial Supply at Fulfillment Centers

Amazon Air's Fleet Expansion Is a Bid for Logistics Domination. Announcing it would lease a dozen Boeing 767-300 cargo aircraft from Air Transport Services Group, Amazon’s total fleet will increase to at least 82 planes by next year. Given the retailer’s plans to open its Northern Kentucky Air Hub in 2021, researchers at DePaul University have forecasted that number could swell to 200 aircraft as soon as 2027.  In today’s air freight news, e-Commerce Air Cargo Volumes the 'Saviour' for Many Last-Mile Logistics Firms.

Sell, Stow or Dump? Retailers Wrestle with Mountain of Unsold Stock. With apparel piling up in stores, retailers are left with a dilemma of whether to put items into storage or attempt to offload. While British high-end retailer Next and German sportswear brand Adidas have decided to store items for next year, Emanuel Chirico, chief executive of PVH Corp (which owns Calvin Klein and Tommy Hilfiger) has warned “This is not like wine that gets better with age. Your inventory gets worse.” Given the glut of inventory, Shoppers Can Expect Big Clearance Sales This Summer

A Resilient Return for Asia’s Manufacturing and Supply Chains?. In a survey of over 200 manufacturing and supply chain leaders across Asia, McKinsey finds that 61 percent of respondents expect that the recovery will take at least six months. Building end-to-end supply chain transparency and optimizing work for priority customers were reported as the top agenda items for businesses as they confront both material and manpower shortages. The outlook is less rosy, however, for nations outside of production centers; according to the World Bank: Low-Income Nations Likely to Remain Deeply Damaged Five Years After Pandemic

🌟CFOs Positioned to Lead Supply Chain Retooling as Economic Slowdown Abates. "I've heard it a hundred times," says Steven Bowen, CEO of consulting firm Maine Pointe. "A CFO will say, 'My procurement department tells me they saved 4% this year but I can't see it on my bottom line.' Well, that does not [indicate] a great partnership from the start." Rather than fall back to bad habits, Bowen encourages finance leaders to seize the current opportunity and revisit their supply chain on an ongoing cost and ability-to-grow perspective. To do so, he recommends that CFOs 1) conduct full supply chain assessments testing for stress points, 2) establish a cross-functional team to liaise with sales and other stakeholders, and 3) ensure data is unified across ERPs and legacy systems to eliminate siloed decision making. Relatedly, manufacturers are encouraged to jettison their traditional planning cycles for a data-backed, cross-functional control tower in Launching the Journey to Autonomous Supply Chain Planning.

Mobility 🚗

Airlines Add Flights as Travel Slowed by the Coronavirus Starts to Pick Up. With lockdowns abating across the country, airlines have been restoring flights nationwide. Although Delta plans to have twice as many domestic flights in July as it did in May, its domestic schedule is still expected to be down more than 40% from 2019 levels. Meanwhile, travelers have observed Airlines Say It’s Safe to Travel. But Is It?

Are Mass Transit and Social Distancing Incompatible?. As China returns from quarantine, the country has experienced a significant modal shift with 66 percent of citizens preferring to drive, compared to 24 percent before the outbreak. Now that residents of European and American cities likewise show reluctance to return to public transit, some city leaders have argued it is time to push for transportation to be made permanently free in order to attract ridership back. McKinsey posits cities can safely Restore Public Transit Amid COVID-19 by increasing system capacity and staggering ridership to limit density.

🌟E-Bikes Are Having Their Moment. They Deserve It. For many commuters, battery-powered bicycles have become an alluring alternative to driving or taking public transit. After testing two leading e-bikes, the New York Times’ Brian Chen concludes that the comfort and ease of both the twist-throttle and pedal-assistance models outweigh concerns about the bikes’ weight and increased maintenance. In a further nudge to cyclists, Curfews Halt Transit Services—and Leave Riders Stranded and Citi Bike Promises To Add “Thousands” Of E-Bikes This Summer As NYC Reopens

Lyft Surges on Uptick in Rides, But Still Has Long Road Ahead. Although Lyft was happy to report that rides increased 26% from April to May, overall ridership was still down 70% year over year. Analysts expect the coming months will see more consolidation among rideh ailing and micromobility players as Lyft and rival Uber each look to right-size their businesses. In other ride hailing news: Uber Launches World-First Car Rental Service in Australia and Voi e-Scooters Integrated into German Ride Hailing Service.

The Key Differences in How COVID-19 Is Impacting EU and US Mobility Tech. While both European and American cities have witnessed significant declines in public transportation usage, US-based mobility startups like Uber, Lyft, and Lime have endured more significant layoffs compared to their European counterparts. Despite sales declining 75%, Europe’s Bolt has gone so far as to promise not to make a single layoff. Expecting that concerns about infection will push consumers to try alternatives to public transportation, Investors Are Betting on Micromobility's Post-COVID-19 Future.

Safety Engineering In The Time Of COVID-19. Drawing parallels between safety engineering for autonomous vehicles and the coronavirus, Starsky Robotics CEO Stefan Seltz-Axmacher distinguishes the absence of risk from the absence of unacceptable risk. “It is unacceptable to deploy a system that regularly hurts people while it’s working as expected in normal driving conditions.  On the other hand, it can be acceptable to deploy one that might hurt people while failing in rare ways in uncommon driving situations.  As long as you know the exact risks you’re taking.” Also in autonomous vehicle headlines: Cruise Quietly Acquired German Radar Manufacturer.

House Dems Unveil $494B Transportation Infrastructure Bill. Leading Democrats on the House Transportation and Infrastructure Committee last week revealed the Investing in a New Vision for the Environment and Surface Transportation in America (INVEST in America) Act. The bill, which would replace the Fixing America's Surface Transportation Act (FAST Act) that expires in September, would authorize an additional $494B over five years for infrastructure needs. For a look into mobility plans in other countries, Seoul Aims to Commercialize Urban Air Mobility in 2025.

Fundraises, M&A, Talent 💸

Cognosos Raises $4.5M from Cox Enterprises and Pete Kight. The Atlanta-based startup provides a cloud-based IoT asset intelligence platform. Along with announcing its latest raise, Cognosos also appointed Braxton Jarratt as its new CEO effective immediately.

Poka Raises $4.7M in Venturing Funding Led by SE Ventures. Hailing from Quebec, Poka provides an industrial communication platform to train employees quickly in a sustainable learning environment. Backed by the venture capital arm of Schneider Electric, Poka plans to use its investment to accelerate international growth. 

MySky Raises $5M in Round Led by GMF Capital. The Swiss-based startup has developed an AI-powered spend management platform offering financial transparency and consistency for the private aviation industry. The new funds will support the business’s expansion into the Americas’ market. 

Zeleros Raises €7M of Venture Funding Led by Altran Technologies. The Spanish startup focuses on vehicle optimization within scalable hyperloop mobility systems. The new funds will support its research and development en route to cracking its vaunted multibillion-dollar market opportunity.

Superpedestrian Raises $15M in Deal Led by Edison Partners. Spun out of MIT’s Senseable City Lab in 2009, Superpedestrian has focused on developing intelligent hardware for the shared e-scooter market. With the latest investment, however, the company looks to launch its own shared electric scooter service called Link in four cities in the US and Europe.

Beacon Raises $15M Series A from 8VC and Jeffrey Bezos. The London-based freight forwarding and supply chain finance company was founded in 2018 by Uber alums and joined shortly thereafter by CTO Pierre Martin, previously of Amazon. With the fresh injection the company plans to recruit new hires and invest in technology and market expansion

Keelvar Raises $18M Series A Led by Elephant Ventures and Mosaic Ventures. The Irish strategic sourcing startup uses artificial intelligence and advanced algorithms to optimize enterprise procurement. The new funds will support its expansion plans for the US and Europe.

Beam Raises $26M Series A Led by Sequoia India and Hana Ventures. The micromobility startup headquartered in Singapore offers electric scooters across the city state as well as Korea, Australia, Malaysia, New Zealand and Taiwan. Using the investment to bolster its regional expansion, Beam distinguishes itself from other mobility players by using in-app incentives to encourage users to park their scooters at designated locations.

OTTO Motors Raises $29 million Series C Led by Kensington Private Equity Fund. A division of Clearpath Robotics, OTTO Motors supports Fortune 500 manufacturers with autonomous material handling. The new funding will be used to grow its global network of delivery partners and accelerate product development.

Locus Robotics Raises $40M Series D Led by Zebra Ventures. As discussed on a recent episode of the Future of Supply Chain podcast, Locus is a Massachusetts-based developer of autonomous mobile robots for warehouse and e-commerce operations. The fresh capital will support R&D and fuel the company’s expansion into the EU market.

Tembici Raises $47M Series B Led by Valor Capital and Redpoint eventures. Founded in 2010, the Brazilian startup now claims 80% market share in Latin America’s micromobility space. The funding will help Tembici double down on adding more e-bikes and increasing access to its service in the cities where it operates. 

Facebook and PayPal Invest in GoJek. While their respective check sizes are undisclosed, the two SF tech giants join Google and Tencent by investing in Indonesia’s home-grown ride hailing start up. The investment is expected to help both companies connect with and potentially launch mobile payments for the growing number of Southeast Asian small businesses who regularly use the Gojek app. Following its latest Series F, Gojek’s total funding has now eclipsed $3B.

Argo AI Raises $2.6B from Volkswagen. The Pittsburgh-based self-driving car startup has been developing maps and virtual driver systems for Ford since coming out of stealth in 2017. With the new funding, Argo will expand into Europe where it will absorb VW’s self-driving subsidiary Autonomous Intelligent Driving.

Transplace Acquires ScanData Systems. In purchasing Austin-based ScanData Systems, Transplace acquires its parcel transportation management technology which streamlines booking, tracking, and business intelligence reporting for e-commerce and D2C shippers. By integrating with Transplace’s industry-leading Transportation Management System, the combined product is expected to optimize transportation needs while improving customer satisfaction. 

DAT Announces Acquisition of Freight Intelligence Business from Chainalytics. DAT Solutions enters an agreement to acquire Chainalytics’ Freight Market Intelligence Consortium. The benchmarking and analysis service is expected to solidify DAT’s pricing intelligence and positioning as a leading online freight marketplace. 

FedEx To Take Stake in Hermes. With a limited presence in European consumer deliveries, FedEx looks to acquire a stake in German parcel delivery firm Hermes. While the move is expected to create efficiencies between the two organizations, questions of execution linger in the wake of FedEx’s 2016 acquisition of TNT Express, which has been seen as not very successful. 

Company Building 🛠️

Remote Onboarding Checklist. We ourselves will be onboarding our next Venture Fellow remotely and this checklist has some great tips to make the on-ramp as smooth as possible.

Forwardable Email Intros. Like other VCs, I make a lot of introductions and end up asking for forwardable opt-in emails from those I’m willing to help. I’ve found myself re-sending this link 4 times in the last week alone so it felt like it was worth sharing (yes, I’ve shared this before).

Emotional Fitness for Founders. Founders in our portfolio know how seriously we take mental and emotional wellbeing… self-care helps ensure the foundation of a company is sound. As summer sets in, it’s a good time for Founders to check on their wellness.

Who's Hiring? 👩‍💻

Full Stack Engineer at ChAI in London, UK.

Project Manager at SVT Robotics in Norfolk, VA (remote ok).

BDR at Skupos in Denver, CO.

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.