Dynamo Dispatch (20/03/23)

Issue 230 | Arrival, Nimble Robotics, Verity

Dynamo Dispatch. A 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 💭

🧳This week kicks off two major events: ProMat 2023 in Chicago from March 20-23, and Shopalk 2023 in Las Vegas from March 26-29. Our portfolio companies will be in full force - keep an eye out if you’re attending. 

Check out the latest episode of our podcast as Bobby Healy, the Founder & CEO of Manna Aero Drones (based in Dublin, Ireland), stopped by to discuss Manna’s US launch in the Dallas/Fort Worth area.  

We’re still accepting applications for our Associate program. Apply here if you’re interested! 

🥰Love reading the Dispatch? Make sure you forward it to anyone looking to stay up to date with all things supply chain and mobility.

We Are Dynamo,

Santosh, Jon, and the rest of the Dynamo team (shout out to Anneli for the editorial muscle)

Note: please add “dynamo@substack.com” to your email client, so you don’t miss future issues due to aggressive spam filters.

Supply Chain 📦 

🌟UPS, FedEx Move Aggressively To Court Regional Parcel Shippers. Both companies are leveraging generous price discounts in comparison to regional rivals in this climate of excess capacity. Furthermore, with higher market saturation of parcel carriers of various sizes, consumers are latching onto familiar brands rather than new sources. For more information on the parcel shipping industry, consider reading United Parcel Service's Three-Year Earnings Growth Trails The 30% y/y Shareholder Returns and Smaller Parcel Carriers Leverage Platform, Software Partnerships For Growth,

How Much Is Technology Transforming Supply Chains? For starters, 83% of supply chain executives say that their technology investments have simply not delivered the expected results. This is due to a continued focus on near-term priorities to address problems currently in the supply chain rather than investing in long-term value adds. To get more, consider checking out CGS Issues 2023 Global Supply Chain and Technology Trends Report.

TuSimple Co-Founder Resigns, Accused Of Poaching Staff For New Venture. In a new scandal, co-founder Xiaodi Hou was forced to resign after multiple reports of trying to entice employees to move from the AV trucking company. This comes after he was fired from his CEO, president, and CTO posts after he leaked confidential information to hydrogen-powered trucking startup Hydron. For more on how this impacts the landscape, read TuSimple Trucks Cruise Past The 10 Million Mile Mark and California AV Testing Leaps Ahead While Leaving Trucking Behind.

Kodiak And Forward Air Are ‘First’ To Operate A Self-Driving Truck Lane Between Dallas And Atlanta 24/6. The trucks will conduct three round trips weekly, allowing Kodiak to deliver more than 100 loads along the 800-mile freight lane between Dallas and Atlanta. Kodiak has also agreed to partnerships with US Xpress, CEVA Logistics, IKEA, and Werner Enterprises. For more, consider reading Why USA Truck’s Former CEO Joined Kodiak Robotics.

US Chassis Market Nearing ‘Equilibrium’ After Disruptive Shortages. If volumes continue to be low, it might be time to go ahead and reduce inventory levels, according to Mike Burton, president of C&K Trucking. In fact, volume was already down 25% in February y/y  and it appears that there could be up to a 30%+ change in chassis volumes, far beyond capacity levels. To get more on the state of the market, consider reading Bill Would Limit Liability For Trucking Companies On Noneconomic Damages Lawsuits.

Mobility 🚗 

🌟Biden-Harris Administration Opens Applications For First Round Of $2.5B Program To Build EV Charging Infrastructure. The US Department of Transportation has opened applications for its $2.5B Charging and Fueling Infrastructure (CFI) Discretionary Grant Program, The program aims to build a national network of 500K public EV charging stations and reduce greenhouse gas emissions by 50-52% by 2030. The first $700M will be available to fund projects in publicly accessible urban and rural communities, as well as along designated Alternative Fuel Corridors. The program will build on the $5B National Electric Vehicle Infrastructure Formula Program, which sends money to states, Puerto Rico and Washington DC to build EV charging infrastructure along designated interstates, US routes, and state highways. For more on the application, read Fact Sheet: Biden-⁠harris Administration Announces New Standards And Major Progress For A Made-In-America National Network Of Electric Vehicle Chargers.

Foxconn Finds EVs Are Harder to Build Than iPhones. Last year, Foxconn paid $230M for a former General Motors. factory in Ohio, aiming to make it the center of a US auto-manufacturing push. It had big plans for the plan, saying it would generate $33B in annual revenue by 2025. After a slow and disappointing start of a partnership with Lordstown Motors, the EV maker asked Foxconn to suspend production in January as the cost of making the trucks exceeded the targeted sale price of $65,000. For more on Foxconn’s EV ambitions, read Foxconn Plans To Produce Electric-Vehicle Batteries In Wisconsin and Foxconn Has Only Managed To Make About 40 Lordstown Endurance Pickups So Far.

Uber, Lyft Score Victory As California Court Affirms Right To Treat Drivers As Contractors. A California court has ruled that Uber and other gig economy firms may continue to treat their workers as independent contractors, preserving Proposition 22, a ballot measure passed by state voters in November 2020. The court upheld the proposition but asked that a clause limiting collective bargaining by workers be severed from it. This decision is seen as a victory for Uber, Lyft, DoorDash, and Instacart, who have faced legal battles over the classification of their workers in California. For more on the matter, check out California Court Reverses AB 5 For Uber Drivers While Trucking Awaits Ruling and California Court Upholds Treating App-Based Drivers As Contractors.

Baidu Says It Can Now Operate Robotaxis In Beijing With No Human Staff Inside. Baidu's autonomous ride-hailing service, Apollo Go, has been granted permission to offer fully-driverless rides in Beijing, making it the first company in the world to do so. The expansion of the robotaxi service means Baidu can offer fully autonomous rides to over 21M residents in China's capital city. Baidu's Apollo Go service has already surpassed two million rides in late January 2023 and is currently providing an average of over 20 rides per EV, per day in Beijing. Baidu's goal is to expand the Apollo Go self-driving service to 65 cities by 2025 and 100 cities by 2030. To learn more, check out Baidu (Bidu) Robotaxis Offering Fully-Driverless Rides Continue To Take Over China and Baidu, Pony.Ai Win Permits To Offer Driverless Robotaxi Services In Beijing.

Volkswagen Announces Five-Year $193B Investment Plan As Electrification Gathers Pace. Volkswagen has announced plans to invest €180B ($192.6B) between 2023 and 2027, with over two-thirds of the funds dedicated to "electrification and digitalization." In 2022, the German automaker saw battery and EV deliveries rise by 26%, driven by a 68% increase in China. However, overall delivery numbers declined by 7% to 8.3M vehicles in 2022, and the automotive division's net cash flows decreased to €4.8B from €8.6B in 2021 due to supply chain and logistics issues. Volkswagen plans to "continue investing in electrification and digitalization" and execute its strategic aims in 2023, despite a challenging economic environment. In other VW news, read VW ID. 2all: Volkswagen Shows Its Electric Small Car For Under €25K and VW's Skoda Would Cut 3K Jobs If 'Euro 7' Implemented In Current Form.

General Motors’ China Business Is Hurting, And It’s Not Just Because Of COVID. The Chinese market has been GM’s top sales market for over a decade and one of the two main profit engines for the Detroit automaker. GM's market share in the country has gone down from 15% in 2015 to 9.8% in 2022, and its earnings from the operations have fallen by nearly 70% since peaking in 2014. The reasons include the COVID-19 pandemic, growing competition from government-backed domestic automakers, and consumer perceptions regarding the automotive industry and electric vehicles. For more on EV sales in China, read Ford, GM Engage In China Price War As Car Sales Slump and EV Sales Are Soaring In China. What's Next For Tesla, BYD, And The US.

Fundraises and M&A 💸

FrontM Raises $1.5M In Pre-Series A Funding. From London, FrontM works to increase maritime communication and connectivity capabilities with features such as tracking, monitoring, remote assistance, and video conferencing. The round was raised in partnership with Tradworks.vc, Motion Ventures, and Jenson Funding Partners. Funds will go towards creating more low-bandwidth solutions.

AG5 Raises $6.4M In Seed Funding. The Amsterdam-based company has built a holistic B2B SaaS platform for the manufacturing industry, impacting manufacturing front-line workers the most. The funds were raised from both Peak and Headline. New funds will go towards establishing its presence throughout the European market.

K2 Space Raises $8.5M In Seed Funding. The LA-based spacecraft company specializes in building satellite buses, which are the physical structures of rocketships such as SpaceX’s. Funding was led by First Round Capital and Republic Capital, and joined by Boost VC, Countdown Capital, and Also Capital. The new capital will go towards R&D and launch its first Mega class spacecraft in 2024.

Invenda Group Raises $19M In Series B Funding. Hailing from Alpnach, Switzerland, Invenda has built an automated platform to improve the operational efficiency of the retail industry. The funding was raised by both Point Break Capital Management and Mutschler Ventures. The new funds will go towards scaling its team and operations.

Verity Raises $32M in Series B Funding. Based out of Zurich, Verity has created an inventory tracking system that is fully powered by its autonomous indoor drones. The funding was led by AP Moller Holding with Exor Ventures joining on board as well.  The funds will go towards accelerating operations and meeting purchase orders.

Nimble Robotics Raises $65M In Series B. From the Bay Area, Nimble has created a robotic 3pl service that uses AI-enabled picking robots for logistics operations. The round was led by Cedar Pine, with participation from Breyer Capital, GSR Ventures, and DNS Capital. The fresh capital will go towards scaling its robotic 3pl fulfillment services and scaling its team.

Arrival Raises $300M In Latest Funding. Out of the UK, Arrival is an EV company seeking to electrify vans, cars, and buses for mobility purposes. The funding was raised from Westwood Capital. Palmetto will use the funds to develop its XL delivery vans and start production in Charlotte, North Carolina.

Business Building 🛠️

Throwing an “Exception”. One of the hallmarks of a great organization is how quickly it makes great decisions. We especially like the point on “throwing” an exception which helps balance speed with ensuring the broader team is able to chime in. 

Terrible and Bad Hires. “How confident am I, given n months of this person going at it, that metric I care about them moving will have moved?”

Lenny’s Podcast: Developing OKRs. A great listen from one of of the foremost authorities on OKRs, Christina Wodtke who walks through goal setting and approaches to achieving key results. 

Who's Hiring? 👩‍💻

Be sure to check out the Dynamo website for more job opportunities at our portfolio companies!

Supply Chain Systems Manager at Stord in Union City, GA. 

Account Executive at Vizion in Atlanta, GA (remote). 

Flight Testing Program Manager at Manna in Dublin, Ireland. 

Random Statistic Of The Week 📈

🔋More than 15 new battery factories or expansions in the American South are leading some to rename the region America’s Battery Belt. Lower electricity costs, proximity to railways, and turnkey facilities are part of the reason why.  To learn more check out this short and informative video from the WSJ.