Dynamo Dispatch (2024/05/06)
Issue 279 | Deltia.ai, Swap, Carbonfact
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
If youâre a regular Dynamo Dispatch reader, then you know all about the re-shoring/friend-shoring trend weâve been tracking. We believe itâs driving the beginning of a large rewiring of the global supply chain. As a result, weâve taken a deep dive into the workflows between manufacturers and their suppliers, the pain points that create friction throughout, and potential areas that could be suitable for venture investment.
Read more of the Primer On Workflows Between Manufacturers and Suppliers and let us know if there are any other areas we might have missed!
đ˘Â Join us at the CO.MOBILITY Summit in Chattanooga on May 20-22. Catch Santosh, where heâll be a speaker, and a whole host of mobility leaders and experts to discuss what the future of mobility looks like.
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Supply Chain đŚ
â How Mexicoâs Presidential Candidates Expect to Leverage Nearshoring. During Mexico's recent presidential debate, candidates emphasized nearshoring as an opportunity for economic growth, proposing infrastructure development and policy changes to attract investment. Claudia Sheinbaum Pardo highlighted ongoing infrastructure projects, while XĂłchitl GĂĄlvez Ruiz emphasized legal certainty and clean energy as key factors. Jorge Ălvarez MĂĄynez focused on labor reforms, water management, energy transition, and education as critical elements for Mexico to leverage the nearshoring trend effectively. With the elections coming on June 2, the results can very well influence what the supply chain through Mexico will look like in the future. For more news along the border, âFollow The Moneyâ: Landstar Positions for Nearshoring, Infrastructure Business and Mexico Tariffs On Steel, Plastics to Affect 7% of Total Imports.
USPS Delivery Unit Proposal Sparks Service, Cost Concerns for Shipping Partners. The USPS is exploring changes in its collaboration with shipping consolidators that handle and send customersâ parcels to its facilities. These adjustments could lead to increased prices for customers and impacted service levels, as the Postal Service is in discussions with partners regarding facility access points and negotiated rate discounts to drop off packages further upstream in its network. This move aligns with the agency's broader network overhaul under the "Delivering for America" plan but may also trigger shifts in workshare partnerships and carrier choices for shippers. In other concerns, Teamsters Canada Says Strike at Railroads Could Begin May 22.
Chinese Cross-Border eComm Firms Fuel Demand, Investment Prospects in Bay Cities. Chinese eComm companies like Temu and Shein drove a surge in demand in 2023 for logistics space in the Greater Bay Area, with significant expansion and leasing activities recorded. Five cities â Guangzhou, Shenzhen, Dongguan, Foshan, and Huizhou â accounted for 32% of net absorption across 24 tracked cities. Despite a rise in new supply, logistics properties in the region maintained strong demand, making them attractive investments for institutional investors as well as strategically important locations. Relatedly, CMA CGM to Launch China-Mexico Express Shipping Service and Airline Cargo Lifeline Under Threat As Focus Grows on De Minimis Thresholds.
Britons Finally Taste Full Brexit as Costly Border Checks Begin. Brexit-induced changes are making EU food imports more expensive and complicated, as companies now have to navigate increased paperwork and costs for shipments to the UK. With upcoming checks on fresh food imports, companies like bacon-producer Danish Crown are preparing for added bureaucracy and expenses due to customs. While some businesses are confident in adapting, concerns about increased costs for consumers and potential supply chain disruptions persist, highlighting the ongoing impact of Brexit on trade dynamics and logistics. Related, New Import Customs Clearance Rules Create âChaosâ at UK Border Points.
Soaring Trans-Pacific Spot Rates Add Twist to Last-Minute Service Contract Talks. The trans-Pacific spot rates are surging, prompting mid-size US importers to finalize their service contracts quickly to avoid the significantly higher spot rates compared to the prevailing contract rates. Factors like increased purchase orders from China, strong US imports, and ongoing global uncertainties are driving importers to expedite their shipping schedules, leading to tight vessel space and high spot rates â up 30% over the past weeks. This unexpected spike in spot rates during the contracting season has caught many industry players by surprise and is causing a backlog in contract processing. Elsewhere in maritime, Maersk Raises Profit Guidance On Strong Demand and Red Sea Disruption.
Mobility đ
â Trying to Decode Tesla's Supercharger Chaos. Elon Musk's decision to dismiss much of Tesla's Supercharger team has raised concerns about charging infrastructure in the US and the region's transition to EVs. This move is attributed to rising competition, potentially low profit margins, and Musk's focus on robotaxis. Tesla's Supercharger network, which currently leads globally, has been a crucial part of EV adoption, particularly in North America, where it accounts for 74% of ultra-fast chargers. However, the slowdown in expansion could hinder North America's EV ambitions, contrasting with Europe's rapid growth in charging infrastructure. For some positivity in EV charging: Electrify America Had Its Biggest Year Yet In 2023 And 2024 Could Be Even Bigger and Polestar Demos Extreme Fast Charging 'Breakthrough.
Biden Grants Automakers Some Flexibility on Battery Minerals in Final EV Tax Credit Rules. The Biden administration has provided automakers with a two-year exemption from strict rules concerning eligibility for the $7,500 tax credit for EVs. This exemption applies to "impracticable-to-trace" battery minerals, such as graphite from China, until 2027. However, restrictions on more common minerals like lithium, nickel, and cobalt will be enforced from January 2025, affecting EVs using these minerals from China. While the final rules aim to balance industry concerns and promote EV adoption, they may limit the number of eligible vehicles and influence automakers' investments in EV manufacturing amid shifting demand.
Status of Uber, Lyft Gig Workers Hinges on Massachusetts Court Fight. Massachusetts is at the center of a legal and regulatory battle over whether ride-share drivers for companies like Uber and Lyft should be classified as independent contractors or employees. The state's top court is considering ballot measures that would redefine the relationship between drivers and these companies, with one proposal backed by the industry treating drivers as independent contractors with some benefits and another supported by labor unions allowing drivers to unionize. Uber and Lyft are also facing a civil lawsuit accusing them of unlawfully classifying drivers as contractors to avoid providing employee benefits, which could lead to significant changes in their business models. The outcome in Massachusetts could have broader implications for gig workers' rights and regulations in other states. More legal trouble for Uber: Uber Faces ÂŁ250M London Black Cab Drivers Case.
US to Require Automatic Emergency Braking on New Vehicles in 5 Years. Automatic emergency braking will now be mandatory in all new passenger vehicles in the US, aiming to save lives and prevent injuries. This significant safety regulation, set to go into effect in over five years, targets rear-end and pedestrian collisions, addressing concerns about existing automated driving systems' effectiveness. While critics argue for earlier implementation and inclusion of standards for vulnerable road users like bicyclists and scooter riders, the regulation does seek to enhance overall road safety through performance requirements for vehicles to stop and avoid collisions at various speeds.
Stellantis And Volkswagen Are Off To A Slow Start. Tesla, Stellantis, and Volkswagen have reported disappointing first-quarter financial results, reflecting lower sales and higher costs. Despite this, Tesla plans to introduce more affordable EVs soon, and both Stellantis and Volkswagen are maintaining their full-year targets. Stellantis attributes its revenue decline to lower volumes, an unfavorable product mix, and FX dynamics, while Volkswagen's profit dropped due to weaker demand for premium brands. However, both companies remain confident in their new product portfolios and future financial outlook amidst challenges in the EV market. Elsewhere, GM's Cadillac Backtracks, Says Gas Vehicles Likely to Stay in Lineup Beyond 2030.
The Future of Supply Chain đď¸
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 đ¸
Kubik Raises $1.9M in Seed Extension. Kubik is an Ethiopian plastic upcycling startup that turns plastic waste into building materials. The capital will help the startup scale its operations in Ethiopia. Investors include African Renaissance Partners, Endgame Capital, and King Philanthropies.
Renda Raises $1.9M in Pre-Seed Funding. Renda is a Nigeria-based order fulfillment startup. The funding will be used to improve its offerings, expand into more cities in Nigeria and Kenya, and grow its partnership network. Ingressive Capital led the round, with other participation from Techstars Toronto, Magic Fund, and others.
Potential Motors Raises $2M CAD in Seed Funding. Potential Motors builds advanced driver-assistance systems for vehicles in off-road environments, leveraging computer vision and AI. The capital will be used to fuel its commercialization efforts. Investors include existing backers Brightspark Ventures, Build Ventures, and the New Brunswick Innovation Fund.
Chowdeck Raises $2.5M in Seed Funding. Chowdeck is a Lago-based food delivery startup focused primarily on prepared meals. Investors in the round include YC, Goodwater Capital, FounderX Ventures, and others.
Deltia.ai Raises âŹ4.5M in Seed Funding. Deltia.ai is a Berlin startup that uses AI and computer vision to optimize picking processes, aiming at reducing errors and increasing efficiency in warehouses. The funding will be used to accelerate customer onboarding, enhance AI capabilities for machining processes, and integrate customer IT systemsâ data. Cavalry Ventures led the round, with participation from existing investor Merantix.
Swap Raises $9M in Series A Funding. Swap is a London-based eComm logistics operating system for cross border including tax remittance and customs clearance. The capital will be used for product development, growing the sales and marketing team, and broadening its presence in the UK, Europe, and US. QED Investors led the round, along with participation from Cherry Ventures, 9900 Capital, and 2100 Ventures.
X Shore Raises âŹ8.5M in Venture Funding. X Shore is a Swedish company building electric boats. The capital will be used for product R&D, improving sales and marketing strategies, and designing and scoping future new X Shore models. Investors in the road include existing major shareholders.
Carbonfact Raises $15M in Series A Funding. Carbonfact is a carbon management and reporting tool exclusively for the fashion industry. Alven led the round, with other participation from Headline and YC.
LiNova Raises $15.8M in Series A Funding. LiNova is a high-energy polymer batteries developer designed to allow material replacement of the traditional cathode. The funding will be used to expand its research and development efforts, scale up operations, and accelerate the commercialization of its batteries. Catalus Capital led the round, with participation from Saft, Chevron Technology Ventures, and others.
Indicium Raises $40M in Venture Funding. Indicium offers services such as data strategy, data engineering, and AI development to various industries including manufacturing, retail, and financial services. The new funding will be used to expand its operations in the US. Columbia Capital Corp led the round.
Stargate Hydrogen Raises âŹ42M in Seed Funding. Stargate Hydrogen is an Estonia-based green hydrogen solution startup. The capital will be used to expand operations and development efforts. UG Investments and IPCEI led the round.
EnviroSpark Energy Raises $50M in Funding. EnviroSpark is an Atlanta-based EV charging company. The funding will be used to expand its owned and operated network across the US, innovate its technologies, and further enhance the accessibility and sustainability of EV infrastructure. Basalt Infrastructure Partners led the round.
Pure Lithium Raises Undisclosed Series A Extension. Pure Lithium is a Boston-based lithium metal battery technology startup. The capital will be used to expand operations and development efforts. Ivanhoe Capital and WS Investment Company were involved in this deal.
Bolt Raises âŹ220 Million in Credit. Bolt is a ride-hailing, food delivery, and scooter rental company focused in Europe and Africa. The credit facility will help it prepare for a public offering. Citigroup was the coordinated bookrunner in this latest financing.
WEX Acquires Sawatch Labs. WEX is a global commerce platform that simplifies the business of running a business. Sawatch Labs is a startup developing fleet electrification analytics software. The acquisition has the potential to help advance WEXâs ability to support customers through their EV evaluation processes and complement existing WEX EV solutions.
Hyundai Acquires Majority Stake in Motional with $923M Investment. Korean automaker Hyundai will be taking an 85% controlling stake in the self-driving startup Motional. The capital will allow Motional to stay operational
Who's Hiring? đŠâđť
Be sure to check out the Dynamo website for more job opportunities at our portfolio companies!
Senior Data Scientist at Vizion in Atlanta, GA (Remote).
Traveling Commercial Painter at PaintJet in Houston, TX (Remote).
Software Engineer at Stord in Atlanta, GA.