Dynamo Dispatch (2024/01/08)
Issue 263 | PaintJet, Swap Energy, Bumper
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 💭
Welcome back to the first Dispatch issue of the year! We hope everyone had the chance to take a breath and enjoy the holidays with friends and family. However, the supply chain certainly doesn’t rest as the Red Sea tensions have escalated over the past few weeks. We’ll dig more into what’s happening and its impact on global trade in the Supply Chain section below.
💥 Right before the holidays, Dynamo portfolio company PaintJet raised its $10M Series A in a round led by Outsiders Fund. PaintJet provides a full-stack robotics platform to the industrial painting industry, addressing existential labor shortages with a cost-effective solution. We’re grateful to be a part of PaintJet’s journey and look forward to the team’s continued success!
🥰 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,
Madelyn, Derrek, and the rest of the Dynamo team
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Supply Chain 📦
⭐ How Houthi Attacks in the Red Sea Threaten Global Shipping. The Houthi rebel group's attacks on commercial ships in the Red Sea since mid-November 2023 are causing major shipping companies to exit the region, posing a threat to global supply chains and potential consumer price increases. The attacks have led to a redirection of trade worth around $200B. With the Red Sea being a crucial route for one-third of global container traffic, any sustained disruption could have a ripple effect on global trade, impacting energy markets and increasing shipping costs. The US has initiated an international security initiative to protect commercial vessels, but concerns persist about the effectiveness and potential for wider conflict in the region. For more, Maersk Halts Red Sea Voyages ‘Until Further Notice’, Red Sea Activity Down Nearly 20% After Containership Exodus, and Red Sea Conflict Sees Air Cargo Demand Rise.
Driverless Truck Companies Plan to Ditch Human Co-pilots in Texas in 2024. Driverless truck startups including Aurora Innovation, Kodiak Robotics, and Dynamo portfolio company Gatik AI, anticipate deploying trucks without safety drivers on Texas highways by the end of the year. The companies, having already transported cargo for major companies like Walmart, Kroger, FedEx, and Tyson Foods, argue that the technology will enhance highway safety and reduce transportation costs. Critics, however, express concerns about the lack of regulation, transparency, and comprehensive data collection, suggesting that financial pressures, rather than safety, drive the accelerated timetable. A lot hinges on the success of these initial runs going without a hitch to avoid scrutiny seen in instances like Cruise’s recent troubles. In other tech innovation, DoorDash Plots Expansion Outside Core Restaurant Business in US.
Saving the Panama Canal Will Take Years and Cost Billions, If It’s Even Possible. The Panama Canal has been facing severe water shortages due to drought, impacting global trade as it’s a main trade corridor. The dry conditions have forced the Panama Canal Authority to impose restrictions on the number of vessels crossing, affecting $270B in annual global trade. Long-term solutions being considered include damming up the Indio River and drilling a tunnel through a mountain to pipe fresh water into the canal, a project estimated to cost $2 billion. Another experimental proposal involves cloud seeding to boost rainfall, but shippers have called for urgent action as concerns mount especially in the wake of Red Sea diversions. In other supply chain disruptions, Covid Slashed Consumer Choices and This Is Why They Aren’t Coming Back and Japan Quake Disrupts Operations at FamilyMart, Nippon Steel, and Toshiba.
Behind Cheap Stuff From Shein and Temu: A Hard Bargain With Suppliers. eComm giants Shein and Temu, popular for offering affordable made-in-China goods, are attracting thousands of Chinese factories and vendors to their supply chain. While these platforms enable global reach for Chinese suppliers, some face challenges with razor-thin profit margins, intense pricing pressure, and unsold inventory. The shift toward these platforms is disrupting traditional supply chain models with their on-demand business model, impacting suppliers' sustainability, and leading to increased competition between Shein and Temu. Spurred on by the rise of eComm, Consumers Could Return $82.1B Worth of Holiday Merchandise.
Rail May Be Faster Than Cape Sailings, but is There Enough Capacity? Shippers, seeking alternatives due to Red Sea disruptions, are exploring rail routes through Russia for transporting goods from China to Europe. Despite increased inquiries, insurers are hesitant to provide war-risk coverage without high premiums. While rail through Russia is considered safer than sea routes affected by Red Sea conflicts, the limited capacity of existing services and uncertainty about the situation's duration pose challenges for a potential surge in demand for rail transport. Over in North America, Five of the Six Class I Railroads See Volume Declines in 2023.
Mobility 🚗
⭐ Auto Sales: Industry Records Best Year Since 2019 In 2023, the automotive industry saw a return to relative normalcy in terms of sales with the pandemic and supply chain issues mostly resolved. EV adoption increased and now accounts for close to 10% of the total market in the US, partly due to the Inflation Reduction Act offering incentives for American-made EVs. Inventory levels improved, bringing back discounts and stabilizing transaction prices. However, the high-end and luxury car markets saw depreciation return as supply increased and demand stagnated. In 2024, key trends to watch include the continued popularity of trucks, the declining sedan market, the competition between Bronco and Wrangler, the demand for super-SUVs, and the reshaping of the luxury segment, particularly in the EV space.
7.1M Miles, 3 Minor Injuries: Waymo’s Safety Data Looks Good. Waymo has released new crash data from its first 7.1M miles of fully driverless operations in Arizona and California, revealing that human-driven cars are more than twice as likely to be involved in police-reported crashes and 4-7x more likely to be in injury-causing crashes compared to Waymo's autonomous vehicles. Through October 2023, Waymo's driverless vehicles experienced only three injury-related crashes, all described as minor, while human drivers in the same cities would have expected around 13 such crashes. The data underscores Waymo's safety advantage but leaves questions about its performance in preventing fatal crashes, which require extensive testing over billions of miles. Elsewhere, GM Robotaxi Unit Cruise Offers $75K to Resolve Crash Probe and Turquoise Taillights Tell You this Mercedes is Driving Autonomously.
EV Outlook: Trend for Greater Electrification to Continue in 2024, at Slower Pace. In 2023, the EV industry faced headwinds from high inflation and interest rates forcing companies like Tesla and Lucid to lower prices and adjust production plans. Even major players like Honda and General Motors halted their joint project due to these difficulties. In 2024, the EV industry is expected to shift its focus from maximizing sales to meeting current demand and addressing economic challenges, but experts anticipate continued long-term growth in the global adoption of EVs despite these short-term setbacks. Related, 2024's Best Cars and Trucks Reflect Automakers' Generational Shift and Electric Car Models Eligible for $7,500 Tax Credit Cut to 13.
Micromobility’s Turbulent 2023. Micromobility experienced both major wins and losses over the last year. Cities across the United States made efforts to promote shared mobility options such as bike and scooter-sharing as alternatives to driving, with some cities like Minneapolis and Davis expanding their bike infrastructure significantly. Denver's eBike rebate program even successfully reduced car trips for participants. However, the year ended on a challenging note as Bird declared Chapter 11 bankruptcy, Superpedestrian closed its US eScooter operations, and Nasdaq delisted Micromobility.com for not meeting share price and equity requirements. Lyft also expressed openness to selling or restructuring its bike and scooter business, highlighting the financial challenges faced by operators, as noted in a report by the National Association of City Transportation Officials.
America’s Loneliest Road Is Finally EV-Ready. Range anxiety remains top of mind for potential EV consumers, but major remediation efforts are underway. Route 50, known as "The Loneliest Road in America," has historically been challenging to travel due to its remote nature and lack of amenities, including EV charging stations. However, recent additions of fast-charging stations in Lamar, Colorado, have made it possible for EV drivers to traverse this 3,000-mile highway from Sacramento, California to Ocean City, Maryland. The Biden Administration’s push for increased EV adoption and the expansion of charging infrastructure, including subsidies from utilities and state governments, have contributed to a growing network of public fast-charging stations, making EV travel more accessible in rural areas like the Midwest. Related, EV Fast-Charging Networks Face a Challenging 2024.
The Future of Supply Chain 🎙️
Check out our podcast series that’s been running since 2018. On each episode of the Future of Supply Chain, we sit down with a different entrepreneur, investor, or industry veteran to discuss innovation, technology, and the most exciting opportunities in supply chain as we build the future of the industry together.
Fundraises and M&A 💸
UrbanStems Raises $5M in Series C Funding. UrbanStems is a NYC-based floral delivery company. The company intends to use the funds to expand operations and its business reach. The round was led by SwaN & Legend and DF Enterprises.
Cloudline Raises $6M in Seed Funding. Cloudline is an aerospace startup out of South Africa which aims to lead the development of emissions-free autonomous flight. The capital will be used to fuel growth into neighboring countries Namibia and Mozambique, with plans to then continue the push to global markets. The round was led by Schmidt Futures.
Revfin Raises $14M in Series B Funding. Revfin is an Indian startup providing ancillary auto loans for electric two-wheelers and three-wheelers. The capital will be used for continued growth in reach and services provided. Omidyar Network led the round, along with others including existing investors Green Frontier Capital and LC Nueva Investment Partners.
Soum Raises $18M in Series A Funding. Soum is a re-commerce marketplace that enables SMEs and individuals to sell their secondhand products. The capital will be used to accelerate expansion plans regionally and scale beyond its current focus on secondhand electronics. The round was led by Saudi’s Jahez Group with participation from Isometry Capital and existing investors Khwarizmi Ventures, AlRajhi Partners, and Outliers Venture Capital.
Bizay Raises €18M in Series C2 Funding. Bizay offers a global operating and supply chain system aiming to digitize the product customization industry. The funding will be used to fuel product development and the company’s expansion to the US. The round was led by Indico Capital Partners and joined by Iberis and Lince.
Swap Energy Raises $22.M in Series A Funding. Swap Energy has over 1.3K battery swapping stations in Indonesia for electric two-wheel vehicles. Qiming Venture Partners led the round, with GGV Capital and existing investor Ondine Capital also participating.
Agtonomy Raises $22.5M in Series A Funding. Agtonomy provides advanced autonomous and AI solutions for agriculture. The funding will be used to build upon the customer pilot program and accelerate the development of offerings. The round was led by Momenta and joined by strategic partners Doosan Bobcat North America and Toyota Ventures.
Bumper Raises $48M in Series B Funding. Bumper provides a BNPL solution for customers to fund car repairs. The funding will be used to expand through Europe, targeting car dealers and repair shops in the United Kingdom, Spain, Germany, the Netherlands, and Ireland. Autotech Ventures led the round, with additional participation from Shell Ventures, InMotion Ventures, Porsche Ventures, and Revo Capital.
GreyOrange Raises $135M in Series D Funding. GreyOrange has built a full-stack solution for warehouse, fulfillment, and 3PL needs. The company will use the capital to accelerate technology development, global expansion, and further adoption of its platform in warehouses, distribution centers, and retail stores. Anthelion Capital led the round with participation from existing investors Mithril, 3State Ventures, and Blume Ventures.
Who's Hiring? 👩💻
Be sure to check out the Dynamo website for more job opportunities at our portfolio companies!
Senior Technical Recruiter at Gatik AI in Mountain View, CA.
Operations Manager at Stord in Atlanta, GA.
Data Architect at Amitruck in Nairobi, Kenya.