Dynamo Dispatch (10/28/19)

Issue 82 | Reibus, Fabric, Zoox

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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🎙 Check out Dynamo's podcast series, The Future of Supply Chain.

Weekly Commentary 💭

ICYMI, we launched a podcast collaboration with FreightWaves, For Freight’s Sake. Dynamo Partner Jon Bradford joins FreightWaves’ Craig Fuller to discuss the intersection of freight and venture capital.

Speaking of FreightWaves, we are headed to FreightWaves LIVE in Chicago on November 12-13th. If you’re a founder attending and operating at the pre-seed or seed stage, reach out to us at hello@dynamo.vc.

Have a great week!

We Are Dynamo,

Santosh, Ted, Barry, and Jon

Note: please add “dynamo@substack.com” to your email client so you don’t miss future issues due to aggressive spam filters.

Supply Chain 📦

Google Launches Nation’s First Drone Package Delivery Service in Virginia Town. Google Wing delivers its first parcels in partnership with FedEx in Christiansburg, VA. The head of the FAA’s drone integration office said the industry has now crossed into “walking.” Running will be when projects like the one in Christiansburg can be scaled across the country. Wing’s main competitor in drone parcel delivery, UPS Partners with Medical Suppliers to Do Drone Deliveries

🌟 Amazon Announces Earnings, First Profit Decline Since 2017. Expanding its own shipping services is taking a toll on Amazon’s bottom line. One of the main culprits is a 46% jump in shipping spend as 1-day delivery costs mount with expected Q4 spend of $1.5B to continue program growth through the holidays. In an effort to gain operational and cost efficiencies on delivery (and presumably returns), Amazon Adds Thousands of Counter Pick-Up Locations. Elsewhere in retail, Coach and Kate Spade Parent Invests in ERP Upgrade.

UPS Earnings Overshadowed by Leadership Retirement . The major news was the unexpected retirement of UPS COO Jim Barber, who was envisioned to be the company’s next CEO. Barber oversees the company’s global small package, freight, supply chain, freight forwarding, and engineering divisions. We note that UPS continues to invest in technology (especially important given the Amazon relationship) and scale a more flexible network. More on UPS, Announcements Made Prior to Earnings and UPS Teams up with Stamps.com to Reduce Friction for Shippers.

📊 California Releases Electric Truck Manufacturing Standard. California’s Air Resources Board (CARB) released a standard that would require half of all medium and heavy-duty truck sales in California to be zero-emission vehicles. This is in sync with California’s goal of reducing greenhouse gas emissions to 40% below 1990 levels by 2030 and 80% below 1990 levels by 2050.  ICYMI, Volvo Launches New Autonomous Truck Reporting Unit that will include autonomous and electric solutions for segments as mining, ports, and transport between logistics centers.

M&A Bankers Are Looking for Amazon-Proof Logistics Businesses. As Amazon continues to take control of multimodal transportation capacity, investors are focusing on asset-light companies with value-additive customer relationships, and those supporting expedited freight or last-mile delivery. For more insight into corporate finance and supply chain private equity, have a listen to our latest Future of Supply Chain episode with Ben Gordon of Cambridge Capital.

Mobility 🚗

🌟 Tesla Made a $143M Profit in Q3 2019 on Record Deliveries. Tesla made its first profit since 2018 this quarter on lower revenue but a record 97,000 electric vehicle deliveries. More importantly, Musk continues to confuse consumers around the capabilities of Tesla vehicles by claiming Full Self-Driving will enter an early-access beta in 2020, which he clarified, “will sometimes require supervision when driving semi-autonomously.” Elsewhere, Lyft Says It Will Turn a Profit a Year Ahead of Schedule while Waze’s CEO Says Carpools Are More Important Than AVs.

Chuck Schumer Has a $392BPlan to Boost Electric Car Sales. On Thursday, NY Senator Schumer submitted a plan for a trade-in program offering $3,000+ to individual buyers. While this is likely nothing more than election year posturing, he projects this will take a quarter of U.S. carbon-emitting cars off the road and will create tens of thousands of good-paying jobs. Related, Toyota Has a New Electric Car About the Size of a Golf Cart while Continental Overhauls Business to Focus on EVs.

Fair Carries Out Major Restructuring. SoftBank-backed car subscription startup Fair lays off 40% of its staff and replaces its CFO with someone better versed in managing treasury for large fleets. Fair, which has grown at a rate of 5x over the last few years, is making the shift to become more profitable at a time when the capital markets are keen on profitability.

📊 The UK Government Releases a Study on Public Attitudes Towards Self-Driving Vehicles. Conducting in-person workshops and interviews with 150 people, the UK government found that the public is concerned with safety and security, freedom, equity, and accountability. The study found these concerns are rooted in demographic and socioeconomic disparities—desiring assurance that these proposed networks will be equitable and robust enough to accommodate varying needs. 

How a Micromobility Network Will Plug the Holes in Our Transportation Systems. The piece describes how lightweight micromobility solutions can provide much-needed reliability to existing routes. These solutions can address current shortcomings by offering diversified redundancy for routes wherein several modes of transportation can be used to make the same journey. For a comprehensive view of micromobility modes, see The Micromobility Landscape and separately, Lime’s Losses Are to Top $300M in 2019.

Fundraises, M&A, Talent 💸

Zoox Raises $200M to Build Robotaxis. Zoox is a San Francisco-based robotics company pioneering autonomous mobility as-a-service. The company continues to focus on refining its design with no dedicated front or rear ends, no steering wheel, brake or accelerator pedals or even dashboard controls.

Commercetools Raises $145M Led by Insight Partners. Commercetools is a German startup that provides a set of APIs that power e-commerce sales and related functions for large businesses.

Fabric Raises $110M Led by Corner Ventures. Israel and New York-based Fabric builds automated micro-fulfillment centers allowing retailers to offer sustainable delivery service to their online customers.

Shipwell Raises $35M Led by Georgian Partners. Shipwell is an intelligent supply chain management solution for shippers, 3PLs, and carriers. The company plans to expand employee headcount and open its second office in Chicago next year. 

Upstream Security Raises $30M Led by Alliance Ventures. Upstream Security is a cloud-based cybersecurity platform for connected vehicles. Volvo Group, Hyundai, CRV, Glilot Capital, Maniv Mobility, and Nationwide also participated in the round.

Aurora Insight Raises $18M Led by Alsop Louie Partners and True Ventures. Aurora builds sensors and AI that monitor the radio frequency spectrum in real-time for business intelligence applications.

EV Connect Raises $12M Led by Mitsui & Co. and Ecosystem Integrity Fund. Los Angeles-based EV Connect is building a hardware-agnostic platform to manage electric vehicle charging.

Fairmarkit Raises $11M Led by Insight Partners. Fairmarket is offering automated corporate procurement. “Large organizations are still using paper and pencil to make these big purchases,” Ben Winter, Fairmarkit’s Head of Growth and Marketing.

Logixboard Raises $4.2M Led by Social Leverage. Logixboard's cloud platform integrates with existing systems, automates processes, and provides data insights to provide its freight forwarding customers with greater visibility of their supply chains. 

Reibus Raises $3.25M. Georgia-based Reibus is digitizing industrial purchasing by providing a transparent online marketplace.

Just Eat Investors Reject $6.3B Takeover Bid by Naspers. Investor Aberdeen Standard rebuffed the bid saying that Naspers needed to increase the offer by at least 20% for them to even entertain it. This comes after Takeaway.com’s offer for Just Eat back in July.

Canada Pension Plan Sells 39% Stake in Interparking. This showcases the emerging trend of pension funds moving away from parking assets as people reduce car ownership and rely more on ride-sharing.

Transportation One Hires XPO Veteran Gillihan as Chief Revenue Officer. FTL temperature-controlled freight brokerage Transportation One wants to invest in building its own technology as it outgrows its existing TMS.

Company Building 🛠️

The New Seed Landscape. Pear VC outlines the shift we’ve observed in seed stage venture capital over the last few years - must read for founders gearing up to fundraise for the first time. Related, The Master List of US Micro VCs.

How to Become A Magnet For Talent & Assess Talent. Lessons from Keith Rabois on building an amazing company with A+ players - from recruiting, to evaluation and making the offer.

An Interview with Shopify’s VP of Data Science & Engineering, Solmaz Shahalizadeh. “I recruited machine learning people by not going after machine learning people. Shopify looks at people working in bioinformatics, astrophysics, and economics.”

Who's Hiring? 👩‍💻

VP Engineering at Tenderd in Dubai, UAE.

Regional Sales Manager at Skupos in Denver, CO.

Senior Product Manager at Stord in Atlanta, GA.

Check out other jobs at Dynamo portfolio companies.

❤️ We would love your support. Please forward to friends and share on social media.
🗞️ If you were forwarded this and found it interesting or helpful, please sign up.
🎙 Check out Dynamo's podcast series, The Future of Supply Chain.