Dynamo Dispatch (08/17/20)

Issue 118 | HDVI, Axle, Coreshell

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

💥 Have you seen any interesting startups recently? Introduce us.
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🎙 Check out Dynamo's podcast series, The Future of Supply Chain.

Weekly Commentary 💭

Sourcing is the lifeblood of any VC… we see 400-500 startups/quarter so referrals certainly are a welcome signal in the growing universe of supply chain technology startups. A big thank you to Greg White, Ty Findley, and Paul Bailey for the awesome assists this week.

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 📦

USPS Increase Parcel Rates for Commercial Accounts. To offset elevated operating costs induced by the pandemic, the USPS will levy temporary parcel hikes on high-volume shippers by nearly $1.50/unit. The new hikes won’t impact retail shippers but will impact parcel aggregators. More USPS news, Fiscal Q3 Financial Results and a Recent Patent Application for a Blockchain Based Voting System

Deindustrialization Means Disarmament. In light of China’s tightening control over global supply chains, a deindustrialized US could implicate vulnerabilities around foreign interference, coercion, and espionage. Failure to safeguard the access and integrity of America’s supply chains could be costly in relation to the sovereignty of our nation

🌟Amazon and Simon Property Group Look at Turning Shuttered Stores Into Fulfillment CentersTalks between the two have centered around converting stores formerly or currently occupied by JCPenney and Sears. The notion of such transformation points to the steady decline of malls and the rapid acceleration of eComm. Also, Amazon is Liable for Third-party Products.

The Soaring Cost of International Logistics. Tightening capacity constraints across air, land, and sea have driven up international shipping rates. According to the Drewry World Index, the cost to move goods by ship increased by 12% in 2020 to its highest level in nearly 6 years. Related, Eric Johnson at JoC Discusses Maersk’s Entry into TMSas NRF Expects 2020 Imports to Be at Near-term Lows.

Class I Railroads Close to Implementing PTC. In June, 86% of Class I railroads were in compliance with the PTC mandate. Approximately 700mi of railroad still require certification in order to meet the federally mandated deadline of December 2020.In trucking, Locomotion Completes Pilot with Wilson Logistics.

The Case For and Against Hydrogen Trucks. Proponents of hydrogen trucks argue its ability to mirror the fueling and long haul capacities of diesel trucks make it a catalyst for industry innovation. Naysayers touch on its inefficiency when compared to battery electric power and a host of safety risks. In NYC, a Container Port Purchases Fleet of Electric Yard Tractors while in brokerage, Convoy Unveils Carrier Benefits with Factoring and Fuel Cards.

Fred Smith on COVID-19 and Amazon Breakup. The FedEx Chairman and CEO touched on the shipping split between Amazon and FedEx, citing a shift in macroeconomic trends enabling an independent eComm push. Despite slowing industrial economic activity, Smith still sees “enormous cause for optimism” for the Memphis-based logistics provider. ICYMI in July, 3PL Perspectives for 2020.

Mobility 🚗

BYD Electric Buses: 13M Emission-Free Miles. After preventing an estimated 16k metric tons of greenhouse gas emissions over the last decade, BYD Electric Buses are making their way across the globe. Norway, Chile, and Germany have all recently placed orders for the electric bus reshaping the face of sustainable public transportation.. Speaking of buses, Rethinking Bus Services For a Sustainable Future

🌟Code on Wheels. Regarding software, the average vehicle today requires around 100M lines of code, whereas newer cars with limited autonomous capabilities could require nearly 2-3x more code. Those pushing for L5 autonomy may have 1B lines of code!  The race to integrating an OS and app ecosystem could drive that number even higher.

A Potential Service Halt for Uber and Lyft?. Last week, a California judge ordered Uber and Lyft to reclassify their drivers as employees, meaning benefits must be paid. As a result, the ride-hailing giants are threatening to suspend service in California if the order stands. Speaking of mobility success, How Moovit Went from $0 to $800M.

Is the Madrid Model Made for America?. Madrid’s model of removing specified bike roadway infrastructures and integrating them into regular traffic lanes gains widespread European adoption. Whether “vehicular cycling” would work in America remains unknown as US roadway cycling infrastructure lacks far behind other nations. Also in micromobility, Citi Tempering eBikes Rollout from “Thousands” to “Hundreds”

CATL Seeks to Boost EV Driving Ranges. CATL is developing a new technology enabling battery cells to be integrated with an electric car's chassis. As a result, EV’s could have a driving range of more than 500 miles. Speaking of EVs, Germany Marks Almost 17k New BEV’s as Europe’s Battery Makers Power Up for Green Recovery.

The Vroom Boom of 2020. With the convenience of public transit, many New Yorkers never felt compelled to purchase their own cars. Now, obvious repercussions from the pandemic have forced a once hesitant demographic to change their tone on car ownership, as car registrations from June and July across the five boroughs rose 39% y/y. If you’re in the market for an EV, Lucid Air EV Crushes 500 Mile on Single Charge.

Michigan Builds AV Roadway from Ann Arbor to Detroit. The state of Michigan is partnering with Canvue to dedicate a 40-mile stretch of highway along I-94 solely to AVs. Once the project is complete, the first self-driving vehicles permitted will be public transport and shared-mobility vehicles. Also, Audit of US Auto Safety Standards

Fundraises, M&A, Talent 💸

Coreshell Raises $4M Led By Entrada Ventures. Coreshell is a California-based startup making a coating for electrodes in lithium-ion batteries.

Root AI Raises $7.2M Seed led by Rob May of PJC, First Round Capital, and Outsiders Fund. Root AI is creating intelligent robots to help growers build farms of the future. With the new capital, Root will expand and grow its agricultural robotics business. 

HDVI Secures $16M Series A Led by 8VC and Munich RE Ventures. HDVI helps small and midsize trucking fleets improve safety, compliance, and operations. The new capital will help HDVI scale growth, expand its product offering, launch into new states, and add new features for agents, fleets, and drivers.

Incomlend Raises $20M Series A Led by Sequoia Capital India. Incomlend is a Singapore-based startup operating a trading platform to connect exporters and importers with investors. Funding will help Incomlend expand into Europe, Southeast Asia, and North Asia and build up its technology infrastructure. 

Axle Raises $27.7M in Debt and Equity From Anthemis and Techstars. Axle is an all-in-one financial partner for the modern freight broker to manage their working capital requirements. The fresh capital will aid in scaling operations to additional markets and help scale product development. 

Parsable Lands a $60M Series D Led by Activate Capital and Glade Brook Capital Partners. Parsable is a connected worker platform bringing faster digitalization to the industrial sector. Fresh funding will help Parsable expand operations into Asia, EMEA, and Latin America. 

Advent Buys Majority Stake in Logistics Firm Hermes from Germany's Otto. In light of growing eComm volumes, Hermes has seen parcel volumes soar through 2020. The investment from Advent will support capacity and technology development plans. At close, Advent will own 75% of Hermes UK and also get a 25% stake in Hermes Germany.

Perpetuum is Acquired by Hitachi Rail. Perpetuum is a startup digitizing train maintenance and operations. Terms of the transaction weren’t disclosed but 73 employees from Perpetuum will be integrated into Hitachi’s operations. 

Company Building 🛠️

Lead Gen for SaaS. A 101-level lesson for anyone interested in establishing a quality lead generation effort for their SaaS business.

Rippling Series B Deck. “One non-standard metric we created and use at Rippling is the sales team’s month zero cash-on-cash payback. It’s a useful measure of a sales team’s cash efficiency — we describe it in detail in the deck so you can plug in your own numbers.”

Churn and Customer Success. If you’re a Dynamo portco you have heard us harp #6 - integrations are key in supply chain as it reduces friction relative to existing habits and workflows. That said, #1, #5, and #7 are also important in the context of our industry.

Who's Hiring? 👩‍💻

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

Software Engineer at ChAI in London, England.

Digital Marketer 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.