Dynamo Dispatch. 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 💭
Shoutout to Andrew O'Neil, Meg Paulus, and Sean Petersen for the introductions to brilliant founders, corporates, and investor friends.
We Are Dynamo,
Clay, Santosh, Jon, and the rest of the Dynamo team
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Supply Chain 📦
State of Warehouse Labor: Staying Flexible In 2022. Even after dealing with all the variability due to COVID, only one out of four light industrial businesses (e.g. warehouses, distribution centers, 3PLs, etc.) feel confident about their ability to handle what’s to come in 2022. Although a persistently tight labor market has made retention increasingly critical to long-term business operations, retention efforts alone weren’t enough to close the gap between headcount and demand: 66% of warehouses expect to fill open positions with temporary workers in the next year. Consequently, employee management solutions are becoming increasingly attractive as only 18% use tech-enabled staffing solutions while 94% of businesses couldn’t hire enough. For more news on labor, FMCSA Seeks To Improve Complaint Process For Drivers And Brokers and the DOT Vulnerability Report Highlights Truck Driver Pay.
The US Import Surge Is Skipping The Train. Tens of thousands of container loads of cargo that would normally move on railroads are being hauled on American roads as companies look to get around continuing supply-chain bottlenecks. Truckload volumes moving through the spot market on routes that mirror the nation’s busiest inland route were up 130% y/y in early February, contributing to higher freight rates. On the other hand, US intermodal transports were down nearly 12% after tumbling in 2Q2021 even as retailers and manufacturers rushed to bring in goods. Shippers are more often than usual choosing highways over railroads because shortages of labor, equipment, and warehouse space across supply chains are creating unpredictable delays. For more news in the space, see why Norfolk Southern Changes Operations And Boosts Capacity Through Hiring while Virgin Hyperloop Switches Focus From Passengers To Cargo As It Lays Off Half Its Staff.
Freight Rate Hikes Over The Past 2 Years Crush Economists’ Expectations. The risk for truckload rate has declined in 2Q2022 following January’s figures signaling demand for truckload services has plateaued. Despite rates for truckload increasing by 25% since January 2020, LTL has plenty of pricing runway given LTL Carriers’ prices have risen substantially less than the industry average. In the same timeline, import air cargo rates rose 80%, freight brokerage rates rose by 45% and parcel rates rose 15%, while prices for warehousing services increased 20.5%. As Industry Suppliers Update Pricing Sheets To Battle Inflation, much more detailed information is needed to accommodate for Recently Implemented RFPs Standards In The LTL Industry.
🌟How The Ukraine <> Russia Conflict Challenges Supply Chains. Exports from Ukraine and Russia are led by energy, metals, and basic food products. Russia is the third-largest producer of oil globally and together with Ukraine represents 25% of the global wheat market. Consequently, physical supply interruptions, logistics challenges, and sanctions have already pushed up a wide range of commodity prices: crude oil prices rose to their highest since 2014, and wheat prices are at their highest levels since 2013, increasing total food prices by 22% y/y. Russia’s invasion not only makes Ukraine’s Role As Global Ag Exporter Uncertain but also creates a Substantial Concern For The Global Semiconductor Supply.
Mobility And Automation Are Coming To The Store. Retailers are accelerating plans to enhance the in-store customer and associate experience with mobile and automated technologies. Only 22% of surveyed grocery/general merchandise retailers are satisfied with their digital store experience, compared to 55% of surveyed specialty/department store retailers. 93% of surveyed retailers expect an increase in the use of consumer mobile devices in stores by 2025, and 83% of surveyed retailers anticipate an increased amount of technology deployed in stores. The percentage of associate tasks that are automated is expected to triple by 2025 for grocery/general merchandise retailers, a higher percentage increase than for specialty/department store retailers, which is expected to almost double. Structural developments have led to Drive-Through Lane Competition Heating Up and Restaurants Hiring 100 Robots to Flip Burgers.
Security And Privacy Concerns Prevent Effective Use Of IoT Data. Most of today’s businesses only share IoT data within their own organizations, with security and privacy concerns preventing them from disseminating it to organizations in their wider supply chains. Infrequent data collection and lacking an IoT data strategy leave many businesses surveyed struggling to extract full value from it. More specifically, 82% of respondents that worked in transport admit their organization does not use the data collected from IoT projects as effectively as it could. Three in five of all respondents mentioned security and data privacy concerns were among the biggest barriers, followed by a lag between data collection and availability and the lack of an IoT data strategy. Despite the challenges, companies such as Tallinn Managed To Deploy Predictive Digital Transport Models and governments are pushing for Supply Chain Plans On Data Sharing Among Ports And Manufacturing Industries.
New USPS Offering Places Major Focus On Next-Day Business Delivery. The United States Postal Service rolled out a new offering geared towards leveraging ongoing network improvements, new equipment, new pricing, and also operating precision, with hopes of meeting shippers’ needs: USPS Connect. Its unrivaled network of 30K post offices, reaching 163M addresses six or seven days a week, provides a significant competitive advantage. Moreover, the initiative includes four separate offerings aimed to help shippers meet high consumer demand for affordable, fast local, regional and national deliveries, as well as returns. That said, improving services for carriers came at the cost of the environment given USPS Stuck to 90% Gasoline-powered Fleet Vehicles amid Biden’s deal. Separately, DHL Supply Chain Partners With ReverseLogix.
Mobility 🚗
Tesla Is Rumored To Be Building New Factory Adjacent To Gigafactory Shanghai To Double Production To 2M Cars. This is most likely a product of Tesla’s massive amounts of success with its first Shanghai factory, pushing the company to double down on its success rather than take a risk in another area. The biggest hurdle for this move will most likely be whether or not the talent pool can keep up with double the number of jobs. CATL, a large battery cell manufacturer and Tesla supplier, is also building a new factory in the area that could aid in Tesla’s expansion. For Related News, Check Out Polestar Aims for a Climate-Neutral Car by 2030, Seeks Help from Suppliers and Beyond and Tesla CEO Elon Musk and His Brother are Under Investigation For Alleged Insider Trading.
🌟Power to Move: Accelerating the Electric Transport Transition In Sub-Saharan Africa. Sub-Saharan Africa has unique barriers that could hinder it from transferring to EVs in the near future: unreliable electricity supply, reliance on used vehicles, and low vehicle affordability. This article emphasizes ways in which various stakeholders can overcome these challenges and ramp up EV adoption in the region. A big takeaway is that adoption in the region necessitates active shaping from various stakeholders, namely government entities. For the latest EV information, check out Fiat Wants To Only Sell Electric Cars In Europe After 2027.
Waymo to Keep Robotaxi Safety Details Secret, Court Rules. On Tuesday, Waymo won its lawsuit against the California Department of Motor Vehicles to keep its right to maintain secrecy regarding its AV technology. This is relevant because it could set a precedent that other developers in the industry could have flexibility regarding what details are trade secrets that do not have to be shared publicly. In the short term, it most likely enables more investment but there are risks to long-term safety standards. In related news, check out Stratio And Freeway Partner To Deliver Real Time Predictive Fleet Maintenance Technology To The UK and Florida Poly To Host Autonomous Vehicle Conference.
Audi Is Teaming Up With Verizon To Bring 5G Connectivity To Its Vehicles In 2024. 5G will be an integral asset for vehicle manufacturers trying to implement V2X systems. Audi says their focus is on developing C-V2X communication that protects pedestrians with the new connectivity. Last year, GM and AT&T came into a similar collaboration for GM’s 2024 lineup of vehicles. 5G is expected to be 100 times faster than 4G LTE, but some infrastructure challenges are delaying the delivery of that promise. For related information look at, GM And AT&T Are Teaming Up To Bring 5G To Chevy, Cadillac, And GMC Cars By 2024 and Startup Halo Will Bring Driverless Car Service To Las Vegas Later This Year On T-Mobile 5G.
Ford CEO Farley: No Plan to Spin Off EV Business. Ford’s plan to hit Tesla-esq profit margins isn’t a spin off like some rumors have stated - the focus is actually on using common electrical components and other parts across all vehicle sizes to increase margins. Their main strategy in achieving this goal is by cutting waste from their operation and attracting talent versed in EV technology. It’s yet to be seen if Ford can catch up to Tesla but they are certainly making the investment to try. In other news, California First US State To Hit 1M Electric Vehicles Sold and Nebraska Might Double EV Registration Fees to Make Up for Lost Gas Taxes.
Ukraine Crisis Could Create More Woes For Auto Industry. Sanctions on the Russian economy would likely have a significant impact on the auto industry. Russia is the third biggest supplier of nickel used in lithium ion batteries. It also produces 40% of the palladium which is a key input for gas and diesel vehicles. Long term disruptions could force automakers to swallow increased costs and put up another barrier in the transition to EVs. In related news, As Gasoline Prices Tick Up In Arizona, Stoked By War Abroad, Demand For Electric Vehicles Could Grow and VW To Halt Production At 2 German Plants For Lack Of Parts Made In Ukraine.
Europe Prepares To Ban Aircraft And Parts Sales To Russian Airlines. The EU recently shared its plan to ban the export of all aircraft, equipment, and spare parts to Russia. This would disrupt several international partnerships as well as mobility in and out of the country. This is yet another one of many spillover affects due to recent events that could have both long and short term impacts on mobility patterns and technology. For other news, check out How The Russian Invasion Of Ukraine Is Impacting Global Aviation and AirAsia Makes Plans for eVTOL Air Taxi Services.
Fundraises and M&A 💸
Taur Raises $1.75M From Trucks VC. Taur is a London-based eScooter brand. The original plan was to launch their premium white eScooters in London, but the UK has still failed to legalize privately owned eScooters. Instead, Taur is launching in Los Angeles. Taur is due to start shipping pre-orders for its scooter over the summer, and from August onward, the startup will be selling direct to consumers in LA exclusively.
Warp Raises $2.4M Led By Bee Partners. Warp is a middle-mile delivery solution for shippers powered by a tech-enabled network of carriers and cross docks. They came out of stealth mode following the close of this seed round. The funds will be used to build out its product, accelerate growth in its first few markets, and expand with existing customers.
DayTrip Raises €6M Led By Euroventures. Daytrip is a platform connecting independent travelers with local drivers. Additional investors include J&T Ventures, Nation 1 VC, and Pale Fire Capital. The funds will be used for expansion and product development.
Omnipack Raises €7.5M Led By Flashpoint. Omipack is a Polish-based full-service logistics and fulfillment operations startup. The startup has become an operations partner for Shipbob in January 2022 and also cooperates with Amazon roll-up Factory14 to scale brands with products. The funds will enable Omnipack to rapidly scale to meet demand.
Busbud Raises $11M and Acquires Recorrido. Busbud is a Montreal-based bus ticketing marketplace that connects passengers to bus operators. Investors include WIND Ventures, Export Development Canada, and K3 Ventures. Following this round, it has also acquired intercity bus marketplace, Recorrido to expand its presence in LATAM.
Valerann Raises $17M Led By HG Ventures. Valerann empowers road network operators and creates certainty through enhanced use of data. Additional investors include RIO Ventures Holding and 2B Angels. The funds will be used to support the development of its software platform.
Fleetx.io Raises $19.4M Led By Indiamart. Fleetx provides IoT and software-based products to help fleet operators digitize their logistics operation. The company claims 70% of its business comes from mid to large enterprises and its business is growing 100% y/y. The funds will be used for hiring, improving its product, and scaling its business.
Zoomo Raises $20M Led By Collaborative Fund. Zoomo offers eBikes as a flexible, weekly subscription for gig workers. It also provides fleets of eBikes and fleet management software to enterprise customers like Domino’s. The funds will be used to grow its team, accelerate product development, and expand vehicle offering.
Nirvana Insurance Raises $22M Led By Lightspeed Venture Partners. Nirvana is transforming the $300B+ commercial insurance industry, starting with transportation through cutting-edge predictive models, automation tools, and data-driven insights. Additional investors include General Catalyst, Elad Gil, Fidji Simo (CEO, Instacart), Spike Lipkin (CEO, Newfront), and Sam Hodges (CEO, Vouch).
Shipsy Raises $25M Co-led By A91 Partners and Z3 Partners. Shipsy's AI-powered platform and mobility suite seamlessly connects cross border and local logistics by automating operations and ensuring intelligent 3PL management. Additional investors include Info Edge and Sequoia Capital India. The funds will be used to drive technological innovations and grow its presence in West Asia, India, and Southeast Asia, while accelerating global expansion into new markets such as Europe and the US.
Urent Raises $27.8M Led By MTS. Urent is a Russian eScooter sharing company. The round of funding was led by MTS, Russia’s largest mobile network operator. The funds will be used to expand its fleet, which currently stands at 60K vehicles.
RightHand Robotics Raises $66M Series C. RightHand Robotics provides a collaborative robot and unique gripper solution for a wide range of fulfillment center processes. Investors include Safar Partners, Thomas H. Lee Partners, Softbank Vision Fund II, Zebra Technologies, GV, Menlo Ventures, and Matrix Partners. The company funds will be used to accelerate product and business development, while scaling its global presence and partner network.
Beam Raises $93M Led By Affirma Capital. Beam is a Singaporean shared micro mobility operator. They currently operate eScooters and eBikes in 35 cities across Malaysia, Thailand, South Korea, Australia, and New Zealand. The funds will be used to accelerate growth into new countries like Japan, Indonesia, the Philippines, Vietnam, and Turkey.
Wildtype Raises $100M Series B. Wildtype is a San Francisco-based company that’s developing cultured salmon from cells outside the animal. Investors include L Catterton, Cargill, Leonardo DiCaprio, Bezos Expeditions, Temasek, and Robert Downey Jr. 's FootPrint Coalition. Wildtype is still awaiting FDA approval and can’t sell through the restaurants it expects to partner with until it receives the approval.
Revel Raises $126M Led By BlackRock. Revel is a transportation company that’s electrifying cities through charging infrastructure and shared EV fleets. Additional investors include Toyota Ventures, Maniv Mobility, Goodyear Ventures, Shell Ventures, Broadscale Group, the St Baker Energy Innovation Fund, and Obsidian Ventures. The funds will be used to scale its moped operations.
Hozon Raises Additional $316M. Hozon uses technology to develop intelligent EV models. This latest round marks the close of Hozon’s Series D at $1.26B. Investors include Chinese rail company CRRC Corp’s investment fund and the state-run Shenzhen Capital Group.
GXO Logistics To Acquire Clipper Logistics For $1.3B. GXO provides logistics solutions for multinational companies and blue-chip market leaders. The acquisition of Clipper would increase its opportunities in the high growth eComm market. GXO plans on using 75% cash and 25% in new equity to acquire Clipper’s common shares.
Beam Global Acquires AllCell Technologies. Beam Global is a provider of technology for EV Charging, outdoor media, and energy security. Beam has used AllCell’s battery platform architecture in its products for ten years, and finds it ideally suited for applications that require high power in small spaces. The acquisition will be executed in an all-stock transaction.
BulkSource Acquires WeatherBuild. BulkSource is a supply chain software company that supports bulk material producers, haulers, and consumers. This acquisition enables BulkSource’s customers to utilize WeatherBuild's AI decision solutions to help manage and mitigate weather-related events. The terms of the deal were not disclosed.
Olo To Acquire Omnivore. Olo is a digital ordering and delivery platform for restaurant brands. The acquisition of Omnivore’s point-of-sale integration API will enable Olo’s customers to insert and extract back-of-house data using a developer-friendly API, further unifying disparate data and simplifying data review. The terms of the deal were not disclosed.
SPAC Radar 📡
GSR II Meteora Acquisition Raises $275M. GSR II Meteora Acquisition is a blank check company backed by Meteora Capital targeting high-growth businesses in the software, technology-enabled manufacturing and services, mobility, and transportation sectors. The company raises $275M by offering 27.5M units at $10. GSR II Meteora Acquisition plans to list on the Nasdaq under the symbol GSRMU.
EO Charging Extends Deadline for US SPAC merger. EO Charging provides fast EV chargers to clients such as Amazon and Tesco. They have extended the deadline to complete a $675M deal with US SPAC, First Reserve Sustainable Growth. The agreement is required to be finalized by 11 March.
Company Building 🛠️
How I Built This: Ronnen Harry of PAW Patrol Fame. One you might be able to listen with your kids covering Harry's story of building a toy and amusement company by leveraging intuition. Fun for a weekend car ride.
The Impact of Hybrid Work. As life normalizes post-COVID, we’re seeing the staying power of remote or hybrid work. While we believe it’s difficult to have an organization with people both in office and remote, we do believe flexibility around location is important. For many employees, working at least a day from home is reasonable if they have the right environment and setup to support productivity. It’s something we see our most competitive portfolio companies offer.
Your Startup’s Management Training Probably Sucks. Here’s How to Make it Better. A great primer on improving your organization’s management training through the scale up process. It’s generally true that most leaders in a startup have had limited experience leading and managing - this type of effort can help.
Who's Hiring? 👩💻
Head of Sales and Marketing at WorkHound in Chattanooga, TN (remote ok).
Sales Development Representative at ChAI in London, UK (remote ok).
Head of Analytics at Nextmv in Philadelphia, PA (remote ok).
💥 Have you seen any interesting startups recently? Introduce us.
❤️ We would love your support. Please forward to friends and share on social media.
🗞️ If you were forwarded this and found it interesting, please sign up.
🎙 Check out Dynamo's podcast series, The Future of Supply Chain.