Dynamo Dispatch (2024/06/10)
Issue 289 | Ofload, Neural Concept, Euler Motors
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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 💭
A sincere thank you to all who attended our Supply Chain x AI event during New York Tech Week. The conversation centered around how AI will affect software and services within supply chain, presented by our own Santosh Sankar, Prince Ghosh of Factored Quality, and Zach Fredericks of Primary. An equally big thank you to the Primary team for co-hosting!
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Supply Chain 📦
⭐ Logistics Operators Are Looking to Break the Sector’s IPO Logjam. Transportation and logistics operators are preparing for a wave of public stock offerings, with companies exploring IPOs after a period of tight funding and weak freight demand. Goldman Sachs noted an increase in IPO pitches in the transport sector this year as freight volumes and earnings stabilize, improving valuations. Major potential IPOs include Lineage Logistics, targeting a $30B valuation, and Kenan Advantage Group, exploring a $3.5B IPO. Experts indicate strong interest from PE-backed companies and those with unique specializations outperforming broader market trends, while tech-focused logistics firms like Flexport may struggle to attract investors due to profitability concerns. Speaking of, Flexport Expands the Convoy Platform, Empowering Brokers to Leverage AI to Automate Booking and Boost Productivity.
US Factory Activity Contracts as Orders Slide, Output Weakens. US factory activity contracted at a faster pace in May as the ISM manufacturing index fell to 48.7, the weakest in three months. The new orders measure dropped by 3.7 points to 45.4, indicating weakening demand. High borrowing costs and reduced business investment have hampered manufacturing momentum, despite a slight easing in input costs. The ISM noted that companies are hesitant to invest due to current monetary policies however, there were positive signs in export demand and factory employment, which saw an increase. On the import side, Transpac eComm Freighters on Pause as US Customs Checks Every Parcel and American Ports Seen Lagging When It Comes to Port Efficiency.
Microsoft and Arvato to Design Self-Managing Warehouse of the Future. Microsoft is partnering with German supply chain management and eComm provider Arvato to develop a "self-managing warehouse of the future" by leveraging GenAI, robotics, and cloud computing. The Moonshot project is set to be showcased at the Gartner Supply Chain Symposium in June 2024, aiming to create autonomous warehouse processes. Microsoft will provide expertise in data platforms, AI forecasting, and cognitive services, enabling practical applications such as optimizing picking routes and automating transport complaint processes. The partnership highlights the reach that AI tech giants are expected to have in bringing AI capabilities to the various stages of the supply chain. Related, Amazon’s Project PI AI Looks For Product Defects Before They Ship.
Online Fashion Giant To File Prospectus for £50B London Float. Shein is nearing a London flotation that could value it at around £50B, making it one of the most significant and contentious deals in the UK's capital markets in years. This move signals a high likelihood of Shein pursuing a London listing, possibly by summer or early autumn, as it seeks to raise over £1B from the sale of new shares. Despite controversies over its supply chain practices, Shein's IPO would be London's second-largest ever, with major banks like Goldman Sachs, JP Morgan, and Morgan Stanley advising on the deal. Notable though is that this came on the heels of Shein previously pursuing a US IPO, but political tensions and policies have made that untenable. Underscoring Sheins momentum, Why China’s Overcapacity Problem Is About to Get Even Worse, in Seven Charts.
Christmas Shipments Rush Risks Deepening Supply Chain Crisis, Warns Maersk Boss. Vincent Clerc, CEO of AP Moller-Maersk, has warned that a sudden rush to order shipments for the festive period could exacerbate global supply chain delays and congestion. He noted that recent sharp increases in shipping costs, due to worsening port congestion in Asia and the Middle East, might prompt customers to ship goods earlier than usual, potentially creating a "bullwhip effect." While not an imminent scenario, it’s worth monitoring the situation given the delicate balance of shipping capacity as the industry prepares for the Q4 rush. And another issue to monitor, Cargo Theft on the Rise Report Both CargoNet and Overhaul.
Mobility 🚗
⭐ Chinese Battery Suppliers Tied to Ford, VW Should Be Banned, GOP Lawmakers Say. CATL, the world's largest maker of electric car batteries and a partner to Ford, and Gotion, partially owned by Volkswagen, are accused by a group of Republican lawmakers of ties to forced labor under the Uyghur Forced Labor Prevention Act, signed by President Biden in 2021. The lawmakers sent letters to the Biden administration advocating for these companies to be added to the entity list which would significantly hinder their US aspirations. CATL has stated that any suggestion that the company has used forced labor is “absolutely false”. Related, CATL Still Dominates the EV Battery Market Share in 2024, but BYD is Gaining Ground.
NYC Congestion Pricing Plan Shelved Indefinitely. Governor Kathy Hochul has indefinitely paused New York City's congestion pricing plan, citing concerns about the city's post-pandemic recovery and potential negative impacts on residents. The program, intended to generate $15B for transit modernization and environmental sustainability, was set to begin this month but now lacks a new start date. Hochul's decision has received mixed reactions: Mayor Eric Adams supports further analysis to avoid burdening New Yorkers, while transit advocates criticize the delay, blaming it on political pressure. The congestion pricing plan aimed to reduce vehicle entry into Manhattan and fund essential transit projects, with specific toll rates for different vehicles and limited exemptions. The implementation would have been on the back of similar moves by major cities such as London, Singapore, and Stockholm.
USDOT Finalizes New Fuel Economy Standards for Model Years 2027-2031. The US Department of Transportation’s National Highway Traffic Safety Administration has issued new vehicle fuel economy standards, aiming to save Americans over $23B in fuel costs and significantly reduce pollution. By model year 2031, the average light-duty vehicle will achieve approximately 50.4 miles per gallon. The new standards are projected to save nearly 70B gallons of gasoline and prevent over 710M metric tons of carbon dioxide emissions by 2050. Unrelated, Nissan Trials Autonomous Cars.
Auto Sales Climb for 4th Straight Month, but High Interest Rates Discourage Buyers. In May, US car and truck sales rose for the fourth consecutive month, reaching their highest level of the year with an annual rate of 15.9M, indicating ongoing economic expansion despite high interest rates. However, sales of new vehicles made in the US declined to their lowest level since 2011, excluding the pandemic period, as borrowing costs remaining prohibitively expensive for new would-be buyers. Economists predict the economy will grow at an annual rate of around 2% in the second quarter, with potential interest rate cuts by the Federal Reserve later this year possibly boosting car sales further. Related, US Auto Sales Up 5% in Q1 vs. Q1 2023, Down 5% vs. Q1 2019.
Stellantis, Foxconn form 50-50 JV on Semiconductors for Auto Industry. Stellantis and Foxconn have formed a 50-50 joint venture named SiliconAuto, set to design and sell automotive semiconductors starting in 2026. SiliconAuto will supply semiconductors for Stellantis' vehicles, including the new 'STLA Brain' architecture, as well as for Foxconn and other customers, focusing on components needed for EVs. This venture, based in the Netherlands, aims to secure a stable supply of critical components amidst the ongoing global semiconductor shortage, building on a preliminary agreement from December 2021. Completely unrelated, Polestar Reduces Supply Chain Emissions through Integration of Renewable Fuels for Ocean Freight.
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 💸
Nova Carbon Raises €1.4M in Seed Funding. Nova Carbon focuses on enabling the repurposing of end-of-life carbon fibers. The funding will be used to transition from a laboratory phase into a pre-industrial study phase. Investors include AFI Ventures, UI Investissement, Bleu Capital, and others.
Forge Raises $2.1M in Seed Funding. Forge is a AI-enabled platform to streamline the hardware procurement process for engineers. The funding will be used to improve the product and grow the team. Gradient Ventures led the round, with participation from YC and other angel investors.
Botsync Raises $5.2M in Series A Funding. Botsync is a robotics startup enabling companies to use automated solutions for manufacturing operations. The funding will be used to fuel product development, simplify platform onboarding, and enhance customer service capabilities. Capital 2B and Betatron Venture Group co-led the round, with participation from vyCap Ventures Advisors Private Limited, AppWorks, Iterative, and others
Dealt Raises €6M in Series A Funding. Dealt is a French provider of retail delivery, installation, and services platform with a focus on the circular economy. The capital will be used to grow the team and expand across Europe beyond France. La Poste Ventures and GO Capital co-led the round, with participation from One Green and Holnest.
Field Materials Raises $8.15M in Seed Funding. Field Materials is an AI procurement software to control and verify construction material and equipment spending. The funding will be used to expand the sales, customer success, and engineering teams. The round was led by new investors DivcoWest Ventures, Navitas Capital, Zelda Ventures, and Flyer One Ventures alongside existing investors Blumberg Capital, s16vc, and Zacua Ventures.
Viaduct Raises $10M in Series B Funding. Viaduct is an AI startup that identifies, solves, and predicts product failures. The funding will be used to accelerate both business development and deployments for its solution. FM Capital led the round, with participation from Innovation Endeavors, Exor, Stellantis Ventures, and Sumitomo Rubber.
SiTration Raises $11.8M in Seed Funding. SiTration is a critical metals and materials recovery company. The capital will be used to scale its solution and deploy pilot systems with commercial partners. 2150 led the round, with participation from BHP Ventures, Extantia, and Orion Industrial Ventures.
Whizz Raises $12M in Debt and Venture Funding. Whizz is a New York-based startup offering gig workers access to eBikes for a monthly fee. The capital will be used for expansion across the East Coast and the build out of a new eMoped. Leta Capital led the $5M equity raise, with $7M in debt from Flashpoint VC.
Coboworx Raises €11.4M in Venture Funding. Coboworx is a Germany-based B2B robotics startup helping companies integrate robotics into their digital architecture. The funding will be used to expand Coboworx's team of robotics experts and software engineers, enhance its product offerings, and enter new markets. Investors include Northstar Family Holdings, SquareOne Venture Capital, Picus Capital, and business angels.
Plancraft Raises €12M in Series A Funding. Plancraft offers a software solution for digitizing work processes in the craft industries such as painting, roofing, and more. The funding will be used to aid product expansion and expand beyond the DACH region. Creandum led the round, with participation from Bitstone Capital and High-Tech Gründerfonds.
Qargo Raises $14M in Series A Funding. Qargo helps trucking companies manage their fleets more efficiently, track deliveries, and optimize routes for lower fuel consumption. Balderton Capital led the round.
EthonAI Raises €15.3M in Series A Funding. EthonAI is an AI-powered manufacturing analytics startup to detect defects and identify process inefficiencies. The capital will be used to accelerate its enterprise motion and add new AI capabilities. Index Ventures led the round, with participation from General Catalyst, Earlybird, and Founderful.
Gireve Raises €20M in Funding. Gireve is a Paris-based company that facilitates contracting, invoicing, and data exchange between different players in the mobility sector The funding will be used to fuel European and international expansion, as well as develop new services. Partech’s Impact Fund led the round.
Euler Motors Raises $24M in Series C Funding. Euler Motors is a commercial EV manufacturer based in India. The funding will be used for for pan-India presence and raising servicing infrastructure in 40 cities by March 2025. Piramal Alternatives India Access Fund led the round, with participation from existing investors British International Investment and Blume Ventures.
Neural Concept Raises $27M in Series B Funding. Neural Concept aims to cut EV design time to 18 months through deep learning in a 3D environment, combining data analysis with machine learning. The Series B will be used for recruitment and international expansion. The round was led by Forestay Capital, with new investor D.E. Shaw group, alongside existing participating investors Alven, Constantia New Business, HTGF and Aster Group.
Ofload Raises $31M in Venture Funding. Ofload is an Australia-based logistics startup focused on helping companies make their supply chains more efficient and greener. The capital will be used to support the rollout of its platform. Yarra Capital Management led the round, with additional participation from King River Capital and Jungle Ventures.
NFI Industries Acquires Transfix Brokerage Unit. NFI Industries is a 3PL trucking and warehousing provider. Transfix is a digital freight startup. With the sale of its brokerage unit, Transfix is resetting itself as a software-only provider.
Who's Hiring? 👩💻
Be sure to check out the Dynamo website for more job opportunities at our portfolio companies!
Office and Workplace Manager at Sennder in Berlin, Germany.
Customer Support at Manna in Dublin, Ireland.
Tech Lead at Skydropx in Monterrey, Mexico (Remote).