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 wish everyone a Happy Holiday and New Year. See you in January!
Shoutout to Sunil and Jaime for offering to introduce us to brilliant founders.
We Are Dynamo,
Santosh, Jon, Barry, Ted, Katie, Clay, and Lukas
Note: please add “dynamo@substack.com” to your email client, so you don’t miss future issues due to aggressive spam filters.
Supply Chain 📦
Amazon Is About To Shake Up Grocery Delivery. The service, which has been tested across the pond in the UK, allows consumers to place an order through Amazon’s app or website that then gets fulfilled by Amazon Flex, the retailer's delivery service run by gig workers. But that’s just one piece to the puzzle. The other important piece relies on the implementation of Amazon Fresh which uses technology throughout the store and on shopping carts to track order purchases, eliminating the need for a checkout line. For more on Amazon, check out Amazon Scraps New Ban On Phones In Warehouses 'Until Further Notice'.
🌟Efforts To Move Long-Dwell LA-LB Containers Yield Uneven Progress. As of Dec 9, there were 17,095 containers at the Port of Long Beach, down 40% from Nov 1. From afar, this sounds like fantastic news but the reality is that progress looks just like a roller coaster moving up and down. The same story is being told at the Port of Los Angeles. The effort to reduce the longstanding dwell times was put in place due to significant commercial and political pressure to reduce congestion. Oh and atop that, ports are still dealing with chassis shortages and mountains of empty containers that need to get back to Asia. Also, Container Imports Tumble at Los Angeles, Long Beach Ports while Port Of Long Beach Announces New Digital Data-Sharing Initiative To Streamline Supply Chain.
UPS, Postal Service Step Up On-Time Holiday Deliveries. This year, during the weeks of and after Thanksgiving, both UPS and USPS improved on-time deliveries compared to 2020, unlike competitor FedEx who dropped in performance. FedEx cited the labor shortage as the primary factor causing a dip in performance, something that all couriers seem to be experiencing at the moment. The major players in the parcel space are grappling with tightened capacity and, as a result, shippers are calling upon regional carriers to pick up the slack. In the parcel carrier realm, FedEx Surges After Higher Rates Boost Profit, Ease Labor Worries and UPS Driver Delivers Neighbor's Lost Dog Amid Busy Christmas Deliveries.
Aurora Self-Driving Trucks Are Using Uber Freight To Haul Goods For Customers. For now, Aurora will use Uber’s brokerage platform to haul freight between Houston and Dallas with plans to expand as more terminals are added. Aurora plans to launch its business at the end of 2023 which in theory, with the help of a successful pilot, should “improve efficiency for carriers and ensure trucking capacity isn’t underutilized.” Related, TuSimple Locks In Self-Driving Trucks Deal With DHL.
India Is Aiming To Lower Logistics Costs. According to Sarbananda Sonowal, India’s Minister for Ports, Shipping, Waterways and Ayush, the country is aiming to become a $5T economy by 2025 through the increase of supply chain efficiency and the decrease of associated costs. The blueprint, known as Maritime India Vision 2030 (MIV 2030) creates certain initiatives such as developing world-class mega-ports and transshipment hubs that improve operational costs at ports and reduce turnaround time for vessels. On top of all of this, the ministry is prioritizing clean and renewable energy sources and increasing ship-building capacity. In neighboring China, New Food Import Rules to Go In Effect Despite US and EU Concerns.
Major Vehicle OEMs Sign Agreement for European High-Performance Charging Network. The JV signed by Traton Group, Daimler, and Volvo was created to build up charging infrastructure to service electric, heavy-duty trucks. The parties will invest a combined €500M ($566M) marking the largest European heavy-truck investment in history. The planned network is expected to operate at least 1,700 high-performance charging points. The plan will also help realize the EU’s Green Deal for carbon-neutral freight transportation by 2050. For those who are familiar, we’re less bullish on electricity for long haul trucking and keener on its usage in last mile delivery ala FedEx or UPS parcel. In related news, Schneider, PACCAR Tackle Electric Truck Development and Diving Into Electric Trucks & Electric Truck Charging.
2021: Shippers Faced A Year-Long Battle With Squeezed Trucking Capacity, High Freight Rates. It was a tough year for shippers. They had to grapple with labor shortages, capacity crunches, and high contract and spot rates. Companies got cheeky and invested in private fleet expansion to avoid growing logistics costs. Unfortunately, it doesn’t look like these problems are going away anytime soon as Shipping And Logistics Costs Are Expected To Keep Rising In 2022 while Carriers Maintain Pricing Power As Rejection Rates Rise For The Holidays.
Mobility 🚗
Startup Investment Trends In Travel & Mobility Tech. In summary, the industry was severely knocked down but it’s getting back up, slowly but surely. This year, investment in mobility tech increased nearly 2-fold compared to 2020, jumping from $23B to $44B. But even though this influx of capital is starting to normalize to pre-pandemic levels, the number of deals happening is still 37% lower than in 2019. Over the past decade, ground transportation has dominated the market from an investment standpoint, but private hospitality players (ex: Airbnb), online booking platforms, and aviation startups received a fair share of funding this year.
🌟Toyota, in Reversal, Says It Will Shift More Rapidly to EVs. Toyota, the major automaker who previously opposed the transition to EVs, has committed nearly $35B to invest in EVs and battery research. Toyota also intends to electrify the entire lineup of its luxury brand Lexus by 2030. So what changed? According to Akio Toyoda, the automaker’s President, after attending the climate summit in Glasgow and hearing about Biden’s plan to increase EV sales, the company has felt urged to reach carbon neutrality. Need a Toyota Roundup? Check out Toyota Is Pushing Ahead With EVs, Risk for Tesla and Toyota Extends Production Stoppages In Japan As Parts Run Short.
Largest eBike Company In The US, Rad Power Bikes, Is Raising Prices. Here’s Why. In the early fall, material and transportation costs for the bike industry dipped after an impressive climb that has persisted all year long which sent a false signal that prices were normalizing. On Tuesday, Rad made an announcement all but confirming that the price hike will persist into 2022 after citing the “global supply chain crisis” as the primary antagonist. Being the largest eBike manufacturer, Rad is “often looked at as an indicator for the entire industry” and we’re already seeing its influence affect pricing within the market. Only time will tell if the rise in price will remain permanent or not. ICYMI, Porsche Acquires A Majority Stake In High-End Electric Bike Maker Greyp.
RV Industry Rolls Through US Shortages, Inflation. Even with the rise in raw material shortages and inflation, the industry has been able to thrive and make more money than ever. The origin story begins with the pandemic which caused a surge in RV sales as consumers opted for safer means of travel and lodging. As a matter of fact, Thor Industries, the largest RV producer, shared that at the end of October, it has a backlog worth about $18B. Wholesale shipments of RVs in North America are expected to hit above 602K units this year, which is not only a record but also a 40% increase compared to 2020. Prices are through the roof as well… Want an RV? Prices Are 40% More Than a Year Ago.
Airlines Face Labor Shortage, Executives Say. The airline industry could be on the brink of a labor shortage just like the transportation and warehouse industries have faced this year. What happens when you stretch a rubber band too far? It snaps. Similarly, airlines are stretching staff thin to keep flights in the air and passengers happy as they struggle to hire new pilots, flight attendants, and other key workers. And with the rise of Omicron cases coupled with the looming threat of a random wintery weather event, airlines could experience a “snap” in labor that could ground flights and cancel routes. For more on airlines, United Airlines Plans To Purchase Up To 100 Hydrogen-Electric Engines and US Airlines Warn 5G Wireless Could Wreak Havoc With Flights.
Rivian To Invest IPO Wealth Into New $5B Georgia Factory And Battery Tech. In last week’s edition of the Dynamo Dispatch, we wrote about rumors surrounding the industry concerning Rivian’s new battery plant and the Peach State. We can now confirm that this rumor has come to fruition. Rivian will use part of the $13.7B it raised through its IPO to build the factory east of Atlanta that has enough capacity to produce 400K vehicles a year. Construction is set to begin in the new year with production set to take place in 2024. Similar to competitors Tesla, Rivian is looking to vertically integrate the entire value chain from raw material procurement to final assembly and sale. For more on EVs, GM Begins Deliveries Of First Ultium-Based EVs and VW Investing $20M To Prepare US Dealerships For EVs.
Edmunds Forecasts Small Increase In US Sales For 2022. Edmunds analysts predict that 15.2M new cars will be sold in 2022, up a mere 1.2% from their 2021 estimate. One thing is for sure though, expect higher prices to continue into the new year. Average transaction prices for the month of November hit around $45K, up from $39K experienced in November 2020. The other trend to keep an eye on revolves around leases. Lease penetration fell to 23% last month, down from 28% experienced in November 2019. In other news, Longtime GM Exec Dan Ammann Is Out As Cruise CEO.
Fundraises and M&A 💸
💥Solvento Raises $4.5M Debt and Equity Round Led By Dynamo Ventures. Solvento is a digital payments and credit provider for truckers in Mexico. Additional investors include Wollef Ventures and Zenda Capital. This investment is focused on product and go-to-market investments to double down on Solvento’s early growth.
Plaio Delivery Raises €2M Led By Frumtak Ventures. Plaio provides pharma customers with the accuracy, predictability, transparency, and precision forecasting missing from the current demand, manufacturing, and purchase planning processes, which, until now, were shockingly manual and spreadsheet-driven, and marred by inefficiencies and human error.
Hier Foods Raises €7m Led By Collaborative Fund. The startup specializes in connecting food retailers to local suppliers through integrations that link both parties’ current systems and processes. The capital will be used to expand operations across Europe through heavy recruitment. Additional investors include Amplifier Labs and A* Capital with existing investors Pale Blue Dot and Speedinvest continuing support.
Bumper Raises €10.6M Led By Autotech Ventures. The trusted car companion, aimed at setting their customers free from all their car worries. Additional investors include JLR’s CVC, InMotion Ventures, and a group of prominent angel investors. The company intends to use the funds to expand its car repair financing platform across Germany, Spain, and the Netherlands in the next three months.
Sweep Raises $22M Led By Balderton Capital. Software to reduce carbon emissions in your business and value chain. Additional investors include New Wave, La Famiglia, and 2050. The funding will be used to amp up its enterprise aspirations, enabling prospective customers “who want to build a credible path to net-zero.”
Full Harvest Raises $23M Series B Led By Telus Ventures. The San-Francisco startup created a B2B marketplace helping suppliers sell surplus imperfect produce to buyers.
New investors who participated in the round include Rethink Impact, Citi Impact, Doon Capital, Stardust Equity and Portfolia Food & AgTech Fund. The new capital will be used to develop technology and grow product teams.
Hive Technologies $30M Led By iSun, Inc.ance Corporation (IFC). Hive Technologies provides financing and maintenance services for EVs. Additional investors include Galway Sustainable Capital, and Los Angeles Cleantech Incubator’s Impact Fund, LACI.
Dray Alliance Raises $40M Led By Headline. Dray Alliance is a trucking industry with a technology platform that makes deliveries to warehouses simple, predictable, and transparent. The round includes $20M equity financing from Headline, Craft Ventures, Harpoon Ventures, Matrix Partners, and Quiet Capital, with an additional $20M working capital financing from JP Morgan.
Tealbook Raises $50M Led By Ten Coves Capital. Tealbook is a provider of supplier data and eCommerce procurement technology. Additional investors include BDC Capital, Grand Ventures, RBC Ventures, Reciprocal Ventures, Refinery Ventures, S&P Global, Stand Up Ventures, RTP Global, Workday Ventures, CIBC Ventures, and Good Friends.
KlearNow Raises $50M Led By Kayne Partners Fund. KlearNow is an on-demand customs clearance platform connecting importers, brokers, and transporters. Additional investors include Kayne Anderson Capital Advisors, GreatPoint Ventures, Argean Capital, Autotech Ventures, and Activate Capital.
Apex.AI Raises $56.5M Led By Orillion. Apex.AI is building an operating system for autonomous vehicles. Additional investors include ZF, Continental AG, AGCO, Canaan, Lightspeed Venture Partners, Airbus Ventures, Jaguar Land Rover’s InMotion Ventures, and other undisclosed investors.
Vay Raises $95M Led By CRV. Vay operates a teleop fleet for consumers. Additional investors include Coatue, and Eurazeo, with existing investors Atomico, La Famiglia, and Creandum participating. Project A, Visionaries Club, and Signals Venture Capital also participated in the round.
HungryPanda Raises $130M Led By Perwyn. HungryPanda is a Chinese food and grocery delivery company. Additional investors include Kinnevik, 83North, Felix Capital, Piton Capital, Vintage, Burda Principal Investments and Kreos Capital. The funds will be used primarily to further enhance its business globally and pursue strategic acquisition opportunities.
Flink Raises $750M Led By Doordash. Flink is an online startup that offers grocery deliveries in ten minutes in Europe. Additionally existing investor Mubadala Capital participated in the round.
Gopuff Raises $1.5B Led By Guggenheim Partners. Gopuff is a digital delivery service designed to deliver daily essentials within minutes. The round is structured as a convertible note, ahead of possible IPO plans.
SPAC Radar 📡
SoftBank SPAC to take Walmart-Backed Symbotic Public in $5.5B Deal. Symbotic is a global provider of integrated supply network automation solutions for warehouses and distribution centers. Symbotic said on Monday it would go public through a merger with SoftBank SPAC in a $5.5B deal.
Company Building 🛠️
Product Lessons Learned: A Conversation with Shreyas Doshi & John Cutler. Listen to it - we can’t do this justice in a simple summary.
Why It’s Too Early to Get Excited About Web3. A little fodder for those uncertain about Web3 and who have to spend the holidays with their Ethereum-crazed family members. As a note - we’re fairly even-keel about this technology and acknowledge supply chain and enterprise will be late adopters in whatever Web3 unlocks.
Pivoting with Purposes, Pre-P/M-Fit. “The most common mistake I’ve seen founders struggle with is falling in love with a particular product or solution and thus spending too many cycles on something that doesn’t work.” We can say this ad-nauseam but this radical belief is part of what makes good founders. Equally, this is why having good advisors/investors is helpful - they can help you take the blinders off.
Who's Hiring? 👩💻
Integration Specialist at Milk Moovement in St. John’s, Halifax.
Project Manager at SVT Robotics in Norfolk, VA (remote ok).
Customer Success Lead at Backbone AI in New York, NY (remote ok).
💥 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.