Dynamo Dispatch (11/25/19)

Issue 86 | Pensa, GoExpedi, Material Exchange

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 💭

We wish everyone a safe and relaxing Thanksgiving! For those in our readership who are traveling back home from university and might be interested in startups and VC, check out Matt’s take on his time in Chattanooga with us. On that note, applications for our Venture Fellowship starting January 2020 are still open - apply now!

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 📦

FTR’s Shippers Conditions Index Remains in Positive Territory. The index is an indicator of externalities that affect shipping efficiency. For August, the latest point of data collection, the index was flat at 6.4. FTR annotated that measures were positive with less favorable fuel pricing offsetting more favorable freight volume, capacity utilization, and logistics cost factors. Looking ahead, Coyote Predicts Spot Market Prices to Rise in Q1 2020.

Autonomous Trucks May Soothe Japan's Growing Driver Shortage. Under the distress of an aging workforce and surging eCommerce volumes, Japan looks to consider autonomous trucks and platooning. There are currently more than three vacancies for every job seeker in the “car driving” category in Japan. The country is making progress though—in January, the transport ministry conducted demonstration tests of truck platooning on the Shin-Tomei Expressway.  On the last mile front, UPS and Portland Team up on Electric-Assist Trike Delivery.

FedEx and UPS to Slap Major Handling Surcharges on More Parcels. Both carriers are lowering the threshold for “additional handling” fees. From a previous 70 lbs, now the 15-24% surcharge will be applied to packages as heavy as 50 lbs. Based on estimates, this will expand the range of packages affected from 8.4% to 14.8%. Elsewhere in the supply chain, Lowe's to Invest $1.7B in Supply Chain Over 5 Years while Maersk Will Restrain Costs, Expand Logistics Services on Weak Shipping Outlook.

Rise of Food Delivery Drives Traffic Patterns. According to research from Verizon, Delivery distances for restaurants grew 33% and distances for liquor stores grew 58% between Q4 of 2017 and 2018. In the larger context, the rate of retail deliveries continues to rise, as the number of stops and the number of miles driven by drivers supplying retailers and restaurants—both increased by an average of 18%. Related, Sidewalk Delivery Robots Pose ADA Threat and Tax Confusion Stirs Fight in Delivery Sector.

Nikola Reveals New Energy Density Doubling Battery. Nikola’s game-changing prototype EV cell is expected to weigh 40% less and cost 50% less on the material side per kWh and have less of an environmental impact than Li-ion batteries. A truck using this technology may weigh 5,000 lbs less than the current competition. In effect, the cell could increase EV passenger car ranges from 300 to 600 miles, and a fully loaded Class 8 would have a range of up to 800 miles. Did you see that Anheuser-Busch and Nikola Complete First Zero-Emission Beer Run? Also in trucking, Pilot Flying J Launches Fuel Network Targeting Small Carriers.

📊PwC Study: Retail Is Sold on IoT. Compared to manufacturing and healthcare, the retail sector has the highest percentage of companies with active IoT projects, at 58%. Of these projects, supply chain and asset management continue to be the primary areas of focus. Almost half of the companies surveyed are already seeing the payoff from these projects, and 38% expect to see value within two years.In healthcare, UPS to Use Sensors That Can Track Medical Packages at All Times.

Target Says Cost of Handling Online Orders Drops 90% When Shoppers Use Same-Day Options. CEO Brian Cornell explained that when Target fulfills an online order from a retail location versus a distribution center, about 40% of the cost is recovered. Minimizing costs are key for the retailer as its digital sales were up 31% during the last quarter. Target says its same-day delivery services were responsible for 80% of that growth.  Also, Target Credits New Tech with Lowering Backroom Inventory.

How Our Home Delivery Habit Reshaped the World. This long-form piece illustrates how the steady optimization of home delivery has and will continue to redefine other aspects of life. The evolution of delivery has reshaped retail and is now reshaping our infrastructure and our environment. Form follows function—we’ve shown that we are willing to adapt all facets of life in the continued pursuit of faster and more convenient delivery. 

Mobility 🚗

Tesla Already Received 146,000 Cybertruck Pre-Orders Worth Over $8B. Tesla’s Cybertruck live demo attracted a ton of press. From the shattered window to Delorean, Bladerunner, and Total Recall comparisons, the Cybertruck unveiling won’t soon be forgotten. Will it be the success that Musk set out for though? In reality, the vehicle will probably capture far less of its intended market of Ford F-150 drivers and more of the luxury would-be Hummer drivers. To be fair to the numbers, the preorder deposits were only $100 and are fully refundable. Also, BMW Secures $10B in Battery Cell Supply for Its Upcoming EVs and Ford Gets Serious with Mustang Mach-E Electric Crossover

Federal Perspectives on the Deployment of Safety Technology for AVs. Mississippi senator Roger Wicker held a hearing to elicit recommendations from the DOT as to how Congress and the Federal government can support the DOT’s work on AVs and better inform legislation. Takeaways from the hearing include a focus on updating the AV Start Act to shift more of the legislative safety protocol away from state hands and into federal oversight, as well as a continued focus on consumer education. Also, Feds Pin Uber Crash on Human Operator, Call for Better Rules while Senator Markey Thinks Autopilot Should Be Disabled.

Improving Autonomous Autos by Having Them Guess Which Humans Are Selfish. A group of researchers at MIT and Delft have developed a subjective AI for interpreting factors like driver behavior on top of traditional physical positioning. With this social value orientation system in place, the autonomous driver was able to make more accurate predictions of its fellow drivers' trajectories than it could without. As a result, prediction errors dropped by 25%. Related, Is Vision Zero Actually Working?

Taking City Visualization into the Third Dimension. As a result of Uber’s aerial ridesharing aspirations, 3D modeling of cityscapes has suddenly become of great importance. The capabilities in the field are advancing rapidly. Uber’s ability to roll out flight paths at scale rests heavily on the clarity and reliability of these massive point clouds. Sensitive and polarizing, Uber Rolls out Ride Audio Recording

Electric Citi Bikes Are Coming Back to NYC This Winter. After being pulled from service last April due to breaks issues that injured a number of people, Lyft’s Citi’s ebikes are returning to the docks. The company is also eliminating the $2 flat fee applied to all ebike rentals. The new pricing model will instead charge riders only for the length of time they have the bike.Also, Copenhagen’s Bicycle Lessons for NYC.

Aira, Microsoft, and Moovit Make Public Transport More Accessible for the Visually Impaired. Through its mobile app, Aira offers a service where remote human agents read things such as road signs or menus by leveraging the user’s smartphone camera or smart glasses. Paired with Microsoft’s Azure Maps, Aira agents can now crossreference full, multimodal transit planning and navigation alongside a real-time view of what their customer is seeing. ICYMI, more on transit, Santa Monica's Big Blue Bus Announces Single Ride Passes and Electric Buses Re-Energize Urban Mass Transit.

Airlines Turn Away From Big Jets. Airlines around the world are shying away from buying big jetliners because of slowing passenger growth and a slump in air cargo traffic. There is now a heightened focus on smaller jets to keep operations more flexible. The shifting airline strategy adds turmoil to supply chains at the big aircraft manufacturers as they cope with weaker demand for larger planes amid the grounding of the 737 MAX and production problems with Airbus’ A320neo. Speaking of air travel, EasyJet to go Carbon Neutral

Fundraises, M&A, Talent 💸

Vayyar Labs Raises $109M Led by Koch Disruptive Technologies. Vayyar is an Israeli company that develops mobile, low-cost, 4D imaging sensors to track the movement of people and things. The funding, which is Vayyar’s first in nearly two years, comes as the company is expanding the use of its 4D radar in a range of industries—automotive, healthcare, and retail. 

GoExpedi Raises $25M Led by Top Tier Capital Partners. GoExpedi is a Houston-based procurement solution for industrial and energy maintenance, repair, and operations. GoExpedi offers more than 200,000 critical parts and supplies on its platform at typically 25% less cost than other players. It offers analytics for customer supply chains all the way through to the last mile.

Superpedestrian Raises $20M From Spark CapitalSuperpedestrian is building durable electric scooters that can last up to seven days without recharging. The company’s key offering is analytics. Its platform is designed to detect more than one hundred conditions that could lead to malfunction, triage accordingly, and then determine what response to take in order to prevent vehicle damage and rider injury.

Wayve Raises $20M Led by Eclipse Ventures. Wayve is a U.K.-based developer of artificial intelligence that teaches cars to drive autonomously using reinforcement learning. Wayve’s machine learning methodology has the most in common with the way that humans learn. The company’s thesis has attracted leading SF-based investors because of its robustness in the face of asymmetrical global environments.

Group14 Technologies Raises $18M from Amperex Technologies Limited. Group14 is a Seattle-based developer of materials for electric vehicle batteries. The company will use the new funds to ramp up the manufacturing of a next-generation anode material and advance into commercial production.

Tridge Raises $10M+ From SoftBank Ventures Asia. Tridge is a global wholesaler and trade brokerage platform connecting agriculture importers and suppliers. The company was founded by a former investment banker, who spent his time in the commodity markets for Korea Investment Corporation and Deutsche Bank. Activant Capital and Forest Partners also participated in the round.

Pensa Systems Raises $10M Co-Led by Signia Venture Partners and ATX Venture Partners. Pensa Systems is an Austin-based developer of autonomous perception systems. The company uses drones to manage inventory visibility which can vary by as much as 50% between unloading and point of sale, if gone unchecked. Pensa will use its new funds to speed up delivery and commercial deployment of its system with retailers and consumer brands.

Enway Raises $6.6M Led by Redalphine. Enway is a Berlin-based developer of autonomous street-sweeping vehicles. The company has set its sights on autonomous mobility for special purpose vehicles on private grounds, like warehouses, industrial facilities and private parking lots. It will use the funds to continue to develop its product.

Bolt Bikes Raises $2.5M Led by Maniv Mobility. Bolt Bikes is a Sydney-based electric bike delivery company, raised $2.5 million in seed funding. The company does sell D2C, but the business model innovation is built on renting them out for commercial use. Currently, the bikes are rented on week-to-week contracts for $39.

Material Exchange Raises $2M Led by Inventure Partners. Material Exchange is a Stockholm-based company offering a sustainability solution for fashion supply chains. The marketplace will digitize and increase transparency in fashion supply chains.

Lineage Logistics Expands Global Cold-Storage Space with $900M Acquisition. Lineage Logistics Acquires its rival Emergent Cold, netting a new distribution center in the Dallas-Fort Worth region and four port facilities in New Orleans, Houston and Charleston, South Carolina. In total, Lineage will now own 1.7B cubic feet of temperature-controlled capacity across 260 facilities in 10 countries. One of the main drivers for the expansion is the growth of grocery delivery and meal kit services.

Uber’s Chief Product Officer Is Stepping Down. Uber CPO Manik Gupta will relinquish his role on December 13th. His note to the team said, “After a few discussions with Dara as well as with my family—and now that we’ve made it through the IPO and an important year for the company—I’ve made the tough decision to leave Uber.” Gupta plans to recalibrate his focus around some of the emerging trends in the consumer internet space.

Company Building 🛠️

📊The State of European Tech. The annual report was released last week at Slush. Some highlights: global LPs leaning into European VC with $50B+ raised over the last 4.5 years; diversity still an issue among founding teams with only 8% of startups having mixed gender composition; proven ability to build large businesses with 99 unicorns.

🎧Seed to Scale: Rich Wong of Accel. Rich Wong, GP at Accel, on his thesis of picks & shovels, early bets in mobile and why enterprise automation is the next big thing.

The Bus Ticket Theory of Genius. Paul Graham discusses the importance of having an obsessive interest in something [that matters].

Who's Hiring? 👩‍💻

Marketing Manager at Zeelo in London, England.

Enterprise Account Executive at LEAF Logistics in New York, NY.

Senior Product Manager - Integrations at Skupos in San Francisco, CA.

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.