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 đ
This weekâs Supply Chain section is full of disheartening news highlighting the tough and unpredictable global economy. While there have been various reports and positive signs that might indicate a recovery in the near-term, we at Dynamo hold a more cautious approach especially as we head into potential geopolitical uncertainty that an election year brings.
Thatâs not to say that weâre not extremely excited about the impact startups across the supply chain will bring. In fact, the entire team is headed to Manifest this week where weâre sure weâll be inspired by all the innovation builders are bringing to the ecosystem. Reach out and say hi if youâre also in town!
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Supply Chain đŠ
â Companies Brought In Robots, Now They Need Human âRobot Wranglersâ. As robotics become more prevalent in factories and warehouses (21% of warehouses used some form of robotics in 2023), a new class of workers is emerging to manage and troubleshoot these machines. While robots offer precision in their tasks and the promise of automation, companies are finding that they need hand-holding in the real world. Itâs a reminder that much of the tech we see doesnât necessarily just automatically work once deployed, but requires a nuanced understanding and cooperation with current workflows. Elsewhere in the air, Delta Cargo Launches Small Parcel Delivery Service for eComm Retailers and Pre-Lunar New Year Rush and Red Sea Disruption Boost Asia-Europe Air Rates.
Slump at Texas Factories Mirrors Weakness in Other Fed Surveys. Manufacturing activity in Texas experienced a significant decline at the beginning of the year, echoing a broader trend of contraction in the sector across various regions. Despite previous momentum in the US economy, regional surveys indicate growing pessimism among manufacturers, with concerns ranging from Fed interest-rate hikes to subdued demand. However, there remains a mixed sentiment among manufacturers, highlighting uncertainties about future economic conditions. On the other hand, PMI Shows Manufacturing âReady To Start Running Againâ with Demand Up and Surging Vietnam Exports Signal Hope for Global Demand Recovery.
UPS To Cut 12K Jobs, May Sell Coyote Brokerage Unit. UPS unveiled plans to slash 12K management and contract jobs this year as part of its "Fit to Serve" initiative, aiming to streamline operations and enhance efficiency. In addition, it is exploring strategic alternatives for Coyote Logistics, its truckload brokerage business that UPS acquired for $1.8B in 2015. CEO Carol Tomé cited challenges in understanding the cyclical nature of Coyote Logistics' business as revenue has dropped considerably after nearly doubling through the pandemic. These measures come amidst projections for stabilizing revenue and margins throughout 2024 amid economic challenges and labor cost pressures. Related, As Demand for Fast Deliveries Surges, Companies Struggle With the EV Transition.
Delivery Hero Exits Deliveroo as Takeaway Demand Wanes. Delivery Hero has divested its entire stake in Deliveroo for ÂŁ77M, citing a decline in consumer demand for takeaways post-pandemic. The sale comes amidst increasing pressure on food delivery companies to demonstrate profitability amid rising costs and investor scrutiny. Delivery Hero plans to utilize the proceeds for general corporate purposes, marking a shift in its investment strategy. While the recent struggles of delivery platforms have been well documented, it doesnât seem like weâre quite through the full fallout of the COVID-induced inflated market. Across the ecosystem, Logistics-Tech Startups Face Uncertain Future as Freight Slump Continues.
Growth is Good: BNSFâs Enduring Commitment to Customers. In this public report, BNSF Railway announced its ongoing prioritization of growth, investing over $700M in expansion and efficiency projects in 2023 alone. BNSF emphasized that it has consistently expanded its operations, fleet, services, and facilities and highlighted its future growth initiatives such as the Barstow International Gateway, grain shuttle facilities, and the expansion of Certified Sites and Logistics Centers, all aimed at enhancing efficiency and capacity for its diverse customer base. Itâs a reminder of the strategic importance the railroad plays in a healthy supply chain. For more on the topic, North America Railroads See Intermodal Revenue Fall, But CPKCP Bucks the Trend.
Mobility đ
â GM to Release Plug-in Hybrid Vehicles, Backtracking on Product Plans. GM is adjusting its product lineup strategy to include plug-in hybrid electric vehicles (PHEVs) in North America, a shift from the firmâs previous all-in EV strategy. While GM remains committed to eliminating tailpipe emissions from its light-duty vehicles by 2035, CEO Mary Barra stated that deploying PHEV technology in select segments will help bridge the transition towards full electrification and still offer important environmental benefits in the near-term. This shift demonstrates the ongoing growing pains for an industry undertaking a once-in-a-generation technological evolution as essential roadblocks such as a lack of charging infrastructure continue to be cleared. On that point, US Adds 1,000-Plus EV Stations in Six Months, Ford CEO Confirms Complimentary Charging Adapters Coming Soon, and elsewhere, VW Joins Renault in Pulling Back from EV Stock Offering Efforts as Demand Slows.
Aviation Industry to Tackle GPS Security Concerns. Aviation companies and European regulators are taking measures to address a recent increase in GPS tampering incidents near war zones such as the Middle East and Ukraine/Russia regions. While these incidents haven't posed immediate safety threats, they are heightening cybersecurity risks. The International Air Transport Association (IATA) and the European Union Aviation Safety Agency (EASA) will enhance documentation and alert procedures for GPS tampering, ensuring pilots can identify and respond to such incidents and encouraging the design of more secure satellite navigation systems. These actions are essential as GPS spoofing can lead to confusion about aircraft location and potential airspace conflicts, posing risks to aviation safety and highlighting broader security concerns. For more on this, check out GPS Interference Now a Major Flight Safety Concern for Airline Industry.
Raimondo Warns Chinese EVs Pose National, Data Security Risks. US Commerce Secretary Gina Raimondo has expressed concerns about Chinese-made EVs, highlighting potential national security risks associated with the collection of vast amounts of driver and vehicle data by these vehicles and questioning whether such data should go to Beijing. Her remarks come in the context of the Biden administration considering additional tariffs on Chinese automobiles and measures to protect Americans' personal information. Raimondo's comments underscore the broader technology competition between the US and China, with national security and statecraft increasingly influencing decisions related to not only EVs but other industries like semiconductor manufacturing. Also, Australia's EV Battery Metals Industry Faces Indonesia, China Challenges.
Chinaâs XPeng is Bringing its Tesla FSD Equivalent to Overseas Owners. Chinese EV manufacturer XPeng is expanding its presence in the international market by developing its smart driving software, including the Navigation Guided Pilot (NGP) and its advanced version XNGP. XPeng plans to release the highway-specific NGP for global users in 2024 and the international version of XNGP in 2025. The company aims to enable overseas users to access its autonomous driving technology, similar to Tesla's Full-Self Driving, and has already ventured into European and Middle Eastern markets with its electric SUVs and sedans. The success of XPeng's map-free driver-assist system in these new markets remains to be seen. Also, China's Geely Launches 11 Low-Orbit Satellites for Autonomous Cars.
Driverless Cars Covered 5x More Test Miles in California in 2023. In California last year, completely driverless vehicles traveled 3.3M miles, a significant increase from the previous year, with GM's Cruise and Alphabet's Waymo accounting for the majority of these miles. Despite this progress, concerns have arisen after a Cruise robotaxi accident that prompted the company to halt operations nationwide. The state's DMV reported a rise in autonomous tests with safety drivers as well, and there are ongoing concerns about the safety and data practices of Chinese companies involved in autonomous vehicle testing. Completely unrelated, Carnival Reroutes Red Sea Cruises as Fighting in the Region Intensifies.
The Future of Supply Chain đïž
Check out our podcast series thatâs 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 đž
đ„ Zeelo Acquires Kura. Kura offers a safeguarding tech platform for school and college bus transportation as well as a similar service for employee shuttles and charter transport services. Zeelo is a smart-bus platform that optimizes bus programs through a routing algorithm that increases ridership and saves customers on their billings. Zeelo will continue to âexpand its sales and operations in the US and enhance its technology platform.â
Energy Source Raises $1.2M in Funding. Energy Source is a Brazilian-based startup offering solutions for end-of-life battery management and lifecycle optimization. The new capital will be used to broaden the focus beyond the UK and the US. InMotion Ventures led the round.
Akirolabs Raises âŹ4.6M in Seed Funding. Akirolabs is a Berlin-based SaaS platform for collaborative strategic procurement. The funding will be used to continue building out the product with a focus on AI capabilities and expand customer growth. HTGF, OTB Ventures, D11Z Ventures, and Serpentine Ventures led the round.
CitySwift Raises âŹ7M in Funding. CitySwift is a mobility intelligence platform providing operators with insights to optimize bus networks. It plans to use the funding to speed platform development. Gresham House Ventures led the round along with existing investors Irelandia Aviation, Western Development Commission, and Act Venture Capital.
GreenSpark Raises $9.4M in Funding. GreenSpark is an operating system for scrap yards and other metal recyclers. The capital will be used to continue building out the software suite. The round was led by Zero Infinity Partners and Third Prime with participation from Bienville Capital and select strategic individuals.
Tau Group Raises âŹ11M in Series B Extension Funding. Tau Group focuses on the decarbonization of energy and electrification of transport through a proprietary electric motor insulated wire. The funding will be used to expand production capacity in a new facility to meet the demand of automotive industry partners. The round was led by DP Venture Capital and Santander InnoEnergy Climate Fund.
BluSmart Raises $25M in Venture Funding. BluSmart is a ride-hailing company which operates an all-electric fleet. The capital will allow the company to expand its EV charging infrastructure from the current 35 stations (operating approximately 4K chargers) to ~95-100 stations over the coming months. The funding comes from ResponsAbility.
Heart Aerospace Raises $107M in Series B Funding. Heart Aerospace manufactures 30-seat hybrid-electric aircrafts. The capital will in part be used toward type certification under the European Aviation Safety Agency expected in 2028. Investors in this round include EQT Ventures, Sagitta Ventures, and Breakthrough Energy Ventures.
Zum Raises $140M in Series E Funding. Zum seeks to turn battery-powered buses into roving power plants. The capital will be used to expand the companyâs AI-driven vehicle-to-grid platform which when deployed alongside its fully EV school bus fleets turns the vehicles into virtual power plants. The funding comes from GIC, Sequoia, and SoftBank.
Who's Hiring? đ©âđ»
Be sure to check out the Dynamo website for more job opportunities at our portfolio companies!
Marketing Automation Specialist at Skydropx in Monterrey, Mexico (Remote).
Senior Software Engineer at Vizion in Atlanta, GA (Remote).
Implementation Manager at Raft in Chicago, IL.