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 đ
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Santosh, Jon, Barry, Ted, Katie, Clay, Skyler, and Lukas
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Supply Chain đŚ
Inflation Pressure Now âBrutalâ Because of Supply Squeeze, US Companies Say. A culmination of inflationary pressure and the disruptions in the flow of goods is making prices rise for consumers. Whirlpool recently shared that the price increases for steel and other materials will add nearly $1B in appliance manufacturing costs this year alone and have directly pointed the blame at supply chain inefficiencies. Chief Executive of Albertsons, Vivek Sankaran shared that, âOn any given day, something is out of stock in the storeâ which is an understatement to Chipotleâs CFO, Jack Hartung sharing that they are having difficulty sourcing all of their ingredients. Other brands such as P&G, Pepsi, VF Corp, and United Airlines have all shared that they are facing shortages or price increases upstream that is making them reassess pricing and promotion strategies. In similar news, Shortages and Inflation Are Rooted At Central Planning.
Amazon Launches Fulfillment and Delivery Services For Local Businesses. Amazon announced that they have a new service for local selling which offers in-store pickup and local delivery for businesses. Amazon shared that customers can select same day pick-up from their sellersâ local store or local delivery with add-on services such as installation or assembly. In 2020 Amazon spent $35B in capex, for comparison Walmart spent $10B which we view, in part as a proxy for investment in logistics enablement. This has gotten Amazon closer to their customers as now 63% of the US population lives an hour away from an Amazon fulfillment center. For Amazonâs third party sellers this will help manage delivery costs as UPS and Fedex announced upcharges just prior to this year's peak shipping season. In related news, Amazon is Now A Bigger Shipper in the US Than FedEx.
Supply Chain Crisis Fuels Latest Retreat From Globalization. Efficient global supply chains that allow goods to reach further away from customers at reasonable prices have driven globalization over the last decades. With the disruptions arising from the pandemic, slowdowns in Chinese manufacturing in an effort to meet emission requirements and other bottlenecks have forced global value chains down. With a growing number of considerations to weigh, companies are looking in more places to build resilience. Equity strategists at Bank of America shared that S&P 500 companies had 2% more manufacturing locations in the US in 2000 compared to 2018, although had 5% less in Asia. Ensuring that their constituents have the goods they need, stakeholders may have to start considering resiliency over efficiency in the future supply networks. Unrelated but ICYMI, Gatik, Ryder Cooperate on Autonomous MD Fleet.
Retailers are Having Their Own Supply Chain Issues, Leading to a Battle For Packing Materials. Packaging materials such as plastic, paper, and cardboard are in short supply as capacity remains constrained but demand continues to increase. These keystone resources are present in nearly every piece of freight packaging, posing a major roadblock for shippers getting their finished goods into the hands of consumers. Prices for plastics and resins that make up plastic packaging materials have been climbing since production was disrupted during the deep freeze that hit Texas in February. Other factors include shippers shifting away from single-use plastics in favor of more sustainable options, driving the demand for paper-based packaging. Shippers are looking to expand their network of suppliers and seek domestic sources to ensure they have the supplies needed for the holiday season. Also, Panic Ordering by Retailers Is Making the Supply Chain Crisis âEven Worseâ.
Grocers Grapple With Supply Chain, Labor Woes as Shelves Empty Out Ahead of Holidays. Bare shelves in grocery stores are becoming more common, similar to the hoarding that created a similar situation at the beginning of the pandemic. With significant swings in demand from restaurants and other commercial buyers, the food supply chain is out of sync, matched by global logistics slowdowns. Iâtalia McCarthy of Chicago-based Dill Pickle Food Co-Op shared that they have been struggling to get goods as simple as beans and rice, but also expanding into poultry and beef. Furthermore, McCarthy shared that when orders are filled it is typically only 29% of the total order and that suppliers will be raising prices that will likely be passed onto customers. In other food supply news, Supply Chain Disruptions Impacting Dairy Farmers Amid Ongoing COVID-Related Issues.
Companies Lean On Automation Tech Amid Hiring Crunch. A survey of C-suite executives of companies with annual revenue of at least $250M by West Monroeâs Quarterly Executive Poll found that one-third of these companies are turning to automation to combat hiring shortages. Meanwhile, 7 out of 10 executives in the survey intend to increase wages, and 5 out of 10 are widening the geography that they hire in. An example of automation adoption was that by Nike in partnership with Geek+ who implemented 200 robots to meet the rapid growth of eCommerce demand while reducing the risk of labor shortages. In related news, Some Believe Officials Should Consider Declaring a State of Emergency For Shipping Crisis.
How Loweâs is Trying To Get Ahead of Supply Chain Issues With Its Holiday Campaign. Retail sales are expected to grow 7% during November and December in comparison to last year according to Bain. Although concerns around gaining critical inventory for the holidays is growing and has led home improvement-giant to make larger orders of popular items. This includes items such as Christmas trees which they have gotten their biggest selection ever and have already gone on sale. Other efforts are going to customer product discovery targeted at what they have in stock. Lowes is now on pace to generate $92B in annual revenue, up from $86B last year. Elsewhere, Supply Chain Disruptions Curtail Union Pacificâs Intermodal Volumes.
Mobility đ
Canada Emerges as Cornerstone of North American Battery Supply Chain. Maple syrup. Hockey. Battery supply chain? You heard that right. Canada has all the pieces of the puzzle when it comes to producing batteries for EVs. Itâs home to all the crucial ingredients for lithium-ion batteries including nickel, cobalt, lithium, and graphite. It has decent battery demand and is already connected to the heart of the automotive supply chain. To further prove the point, two cell manufacturers, Britishvolt and Stromvolt, are planning to build manufacturing facilities in Quebec and Ontario respectively. In related news, Carmakers Rush to Build Batteries for EVs and Automakers Are Spending Billions to Produce Battery Cells for EVs in the U.S.
Foxconn Unveils First Electric-Vehicle Prototypes. Foxconnâs attempts to diversify its business beyond Apple products seem to be well underway. Rather than selling the three models as Foxconn-branded vehicles, theyâll be sold under other car brands with the manufacturer offering the basic structure and building the cars. The models revealed include a sedan, a SUV, and a bus and are set to be manufactured by Yulon Motor Co, one of Taiwanâs biggest automakers who also build vehicles for Nissan. Foxconn also recently announced that it would be purchasing an automotive factory in Ohio from Lordstown Motors.
Amazonâs Zoox is Expanding Autonomous Vehicle Operations, Testing to Seattle. The frequency of rain in the area is one of the primary reasons the AV company picked the Emerald City. Seattle also offers differentiated road network topology and tunnels which enables Zoox to improve on its L 3 technology. While Amazonâs HQ is located in Seattle, Zoox CTO Jesse Levinson shared that the companies will still operate separately with the possibility of collaboration down the road later on. The startup is currently testing in three cities - Las Vegas, NV; Foster City, CA; and San Francisco, CA. In contrast, Not Everyone in Seattle Is Excited About As Coming.
Cummins Brings 15L Natural Gas Engine to North America. The engine, designed for heavy-duty trucks, will offer ratings up to 500 hp and 1,850 ft-lbs of torque while weighing 500 lbs less than its diesel counterpart. Why does this matter? The engine marks an important part of Cumminsâ strategy to lower emissions from newly sold products by 30% by 2030. The 15-liter natural gas engine also serves as the basis for Cumminsâ recently announced hydrogen internal combustion engine. In similar news, Kawasaki Commits To A Future Of Electrics, Hybrids And Hydrogen-Fueled Motorcycles.
Dutch Forensic Lab Says It Has Decoded Tesla's Driving Data. The Dutch government has decrypted Teslaâs closely guarded driving data-storage system, revealing vast amounts of information that could be used to investigate serious accidents. The vehicles record metrics such as speed, accelerator pedal position or brake usage and store the data for up to a year. Tesla encrypts its coded driving data to keep trade secrets hidden and to ensure driver privacy. Also, Tesla Aims to Triple the Supercharger Network in Two Years and Tesla Is Back To A Full Vehicle Lineup, But Delivery Timelines Slip Up To Almost A Year.
Stellantis, Samsung SDI To Start EV Battery Output In US In 2025. While the location of the factory is still under consideration, the US can boast another addition to its growing EV supply chain. The agreement comes after Stellantis signed a preliminary deal with battery maker LG Energy Solution less than a week ago. With both ventures, Stellantis has secured an annual battery production capacity of 80GWh, enough power to produce 1.2M EVs. This move is crucial especially since Stellantis aims for 40% of sales in the US to be EVs by 2030. Elsewhere, Toyota and Stellantis Both Plan US Battery-Factory Investments.
The Future of the Car with Fordâs Hau Thai-Tang. With car adoption rates at all-time highs the future of transportation is being shaped today. According to Fordâs Chief Product Platform and Operations Officer, Hau-Thai Tang shared that the major themes will be centered around electrification, connectivity, and autonomy. Hau shared that 80% of customers who have switched to electric vehicles will never switch back, showing signs that EV adoption will be exponential. Through connectivity, Ford intends to collect massive amounts of data from drivers to help shape their future products. When it comes to autonomy Hau believes that common pain points such as parking need to be tackled to allow for drivers to go further than taking their hands off the wheel. Along the same line, What Does The Future of Driverless Cars Look Like?
Fundraises and M&A đ¸
Sendbox raises $1.8M Led By 4DX Ventures. Sendbox is a platform that provides infrastructure for shipping, escrow payments and discovery services to merchants and customers in North America, Europe and Africa, who participate in eCommerce on social platforms like Instagram, Facebook, and WhatsApp. Additionally Enza Capital, FJLabs and Golden Palm Investments invested in the round while Flexport and Y Combinator participated (Sendbox was part of YCâs 2021 winter batch).
SupplyHive Raises $2M Led By Sixty8 Capital. SupplyHive is a Chicago, IL-based provider of Supplier Performance Management (SPM) technology. Angel Investors and Service Provider Capital also participated in the round. The company intends to use the funds to continue to expand operations and its business reach.
Ankeri Raises âŹ2M Round Led By Frumtak Ventures. Ankeri develops cloud based software solutions focusing on ship performance from the perspective of charter parties i.e. contracts. This new round will help Ankeri strengthen its presence in North America, Europe, and Asia.
MariSeafair Raises $5.7M Led By General Catalyst. Seafair offers manning services and crewing software in one integrated platform, connecting seafarers with the best opportunities at sea and matching shipping companies with the most qualified seafarers. Additional participating investors include FirstMinute Capital, Signal Ventures, TA Ventures, SV Angel, SpeedInvest, and returning investor FJ Labs.
BondAval Raises $7M Led By Octopus Ventures. BondAval is a digital platform for B2B credit security to replace bank guarantees and traditional collateral-based instruments. Additional investors include Expa and returning investors Insurtech Gateway, TrueSight Ventures and founders like Monzo and GoCardlessâs Tom Blomfield, ComplyAdvantageâs Charlie Delingpole and EFâs Matt Clifford.
Toolio Raises $8M Led By Jump Capital. New York-based Toolio has built cloud-based merchandising and inventory planning software to enable retailers to optimize their merchandise planning and make better and faster decisions on what products to have and when to have them. Additional investors in the round include Rho Capitalâs Ignition Fund and existing investors like Founder Collective, Notation Capital, and Max Ventures.
Wakeo Raises $11M Led By 360 Capital. Wakeo is a Paris, France-based global leader in real-time visibility for overseas transport. Additional investors include Promus Ventures, through its Orbital Ventures fund. The company intends to use the new to further invest in their ETA calculation models, continue to develop more added-value features, and accelerate international growth.
AirGarage Raises $12.5M Led By a16z. The company works with parking real estate owners and offers a full-stack software and management service for their lot or garage. That means handling everything from installing signage to collecting payments, and even providing parking enforcement. Additional investors include Floodgate, Founders Fund and Abstract Ventures.Â
Yummy Raises $18M Led By Anthos Capital. The app, which includes both delivery and ridesharing, can be downloaded for free, and the company charges a delivery fee or merchant fee. The company launched this month in Peru and Chile. Yummy plans to have 50 active dark stores in each country by the end of 2022, touting that it will be able to deliver more than 2,000 products in less than 15 minutes. Additional investors include JAM Fund.Â
RightHand Robotics Raises $19M . RightHand Robotics provides end-to-end solutions that reduce the cost of e-commerce order-fulfillment of electronics, apparel, grocery. Although the investors in this round arenât disclosed, the Form D filing said 10 investors have contributed to the new funding.
GO Raises $41M Led By Synterra Capital Management. GO is a car subscription startup that allows customers to order a vehicle online without making a down payment. This funding will enable the company to grow its fleet substantially and expand service nationally.
Saildrone Raises $100M Led By BOND. Saildrone designs and manufactures wind and solar-powered autonomous surface vehicles called Saildrones, which make cost-effective ocean data collection possible at scale. Additional investors include XN, Standard Investments, Emerson Collective, Crowley Maritime Corporation, Capricornâs Technology Impact Fund, Lux Capital, Social Capital, and Tribe Capital.Â
Wonolo raises $140M Led By Leeds Illuminate. Wonolo (Work Now Locally) is an on-demand staffing platform that is changing the way businesses find talent for their immediate labor needs. Additional investors include 137 Ventures and G2 Venture Partners, and Franklin Templeton.Â
Flock Freight Raises $215M Led By SoftBank. Flock Freight is targeting the LTL segment, a piece of the broader commercial trucking market in which truckers carry shipments from multiple customers on the same vehicle. Also investing in the new round were existing investors GV, GLP Capital Partners, and venture-capital firm SignalFire. This round also includes Susquehanna Private Equity Investments and Eden Global Partners.Â
Gorillas Raises $1B Led By Delivery Hero. Gorillas is a grocery delivery provider as it aims to aggregate supermarket product ranges delivered to consumers within 10 minutes of ordering. Tencent, Coatue, and DST were among the other investors that participated in the deal.
SPAC Radar đĄ
Transportation SPAC Pegasus Digital Mobility Acquisition Prices $200M IPO. Led by former CEO of Jaguar Land Rover, Ralph Speth who is intending to target both opportunities in electric and hydrogen fuel cell vehicles. This includes vehicles used for both freight and passenger mobility with a focus on Europe.
Who's Hiring? đŠâđť
Cloud Software Developer at Coros in Mountain View, CA (remote ok).
Software Engineer at Amitruck in Nairobi, Kenya.
Senior Customer Success Manager at Nextmv in Philadelphia, PA (remote ok).
đĽ Have you seen any interesting startups recently? Introduce us.
â¤ď¸ We would love your support. Please forward to friends and share on social media.
đď¸ If you were forwarded this and found it interesting, please sign up.
đ Check out Dynamo's podcast series, The Future of Supply Chain.