Dynamo Dispatch (12/17/18)

Issue 47 | McKinsey on Autonomous Trucks, Optibus, Shipa

Dynamo Dispatch. Weekly update from Dynamo covering the latest and greatest in supply chain, mobility, and building venture-scale businesses.

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Weekly Commentary 💭

It's been a great year here in the "Dynamo of Dixie.” The Dynamo Team and I wish you and your loved ones a Happy Holiday and Happy New Year filled with health, happiness, and success. We'll be back in the New Year rested and ready for a great 2019!

We Are Dynamo,

Santosh 💥

What We’re Reading 📖

Supply Chain & Mobility

McKinsey on Autonomous Trucks. The first in a series, McKinsey explores the full industry impact of autonomous trucking. It's expected that full autonomy (10-15 years out) would drive operating costs down by 40% with the distribution of savings still unclear.

2018 Mobility Study from Continental. In the US, there's mixed sentiment on AVs being helpful vs taking the fun out of driving. It is interesting to note that majority of US respondents believe AVs will be a facet of life in the next 5-10 years. Americans are also critical to insurers monitoring driver activity.

ISM Outlook Positive for Transport & Warehouse Investments. A survey of executives in the service sector (including transportation and warehousing) show a 3.4% increase in CapEx with a close to 14% average increase among respondents who expect to boost investments. Overall, economic growth is expected to be positive but more moderated amid an uncertain global trade environment.

A Tumultuous Week for XPO. Short seller, Spruce Point Capital issued a note citing agressive accounting and questionable management practices amid a spree of acquisitions since 2011. The stock price is -56.6% for the year and -44.3% since it's 52-week peak, but +15.4% on Friday as sell-side analysts offered bullish outlooks.

Profile of Bird and Founder, Travis VanderZanden. Suitable way to close 2018, "The Year of Micromobility" in my humble opinion. VanderZander has led Bird to 120 cities, 10M+ rides, and $415M in funding (with a recent $2B valuation) in 14 short months.

Qantas' New Flight Planning To Save $40M/Year. The Constellation system was made in partnership with the University of Sydney and accounts for thousands of routes and millions of data points to build a "cost map" with suggestions around the most efficient route. The system replaces a 30 year old methodology that only looks at 3 or 4 routes with a handful of data points.

New Yorkers, Your Subway Might Move Faster. Aging, misconfigured, and faulty signal systems as well as overly cautious driver training have contributed to the degrading service of the NYC subway system. This last year, a task force was created to analyze every mile of track and suggested a speed increase at 130 locations (34 approved to date) with speed limit changes expected at 100 locations by spring.

UPSNav Routing Pilot Successful. A previously mentioned pilot of UPSNav was deemed successful and will be broadly rolled out in ORION (On-Road Integrated Optimization and Integration) tool drivers use. The system is tailored to the demands of UPS' last mile staff and can improve service levels, reduce mileage and fuel consumption.

A Profile on Scooter Hardware Leader, Ninebot. Ninebot admits that it was blindsided by the demand for electric scooters with sales up 6x, estimated market share of 80% and valuation of $1.5B. All that said, it faces questions over quality and safety after Lime recalled some Ninebot scooters over fire hazards.

Starbucks Expands with Uber Eats. The US pilot began this fall in Miami and will be rolled out through 2019. Uber continues to build the value of Eats ahead of it's 2019 IPO. Interesting to note that Uber began delivery in China in partnership with Ele.me (Alibaba).

Volvo to Release Electric VNR in 2020. The regional haul tractor will begin testing in California in 2019 with a broad rollout in 2020. Details on range and payload were scant but the electric powertrain is in use in FE models in Europe that have two electric motors totaling 370 kW, 496 hp, 627 lb-ft. torque, and range of 186 miles (on 6 batteries).

Postmates Launches Serve Autonomous Delivery Robot. The friendly sidewalk delivery robot has a patented "Socially-Aware-Navigation" system is supposed to allow for a more human-friendly experience. The Serve has a 30 mile range with maximum payload of 50 lbs.

Strategic Developments, Fundraises, M&A

Optibus Raises $40M Series B Led by IVP. Optibus builds routing software for public bus transportation systems. Alibaba also participated in the round.

Agility To Invest $100M in Shipa Over Three Years. Shipa is a digital logistics platform that includes eCommerce enablement services for cross border retailers, delivery and freight services.

Robotiq Raises $23M. Robotiq makes components for collaborative robots including cameras, sensors, grippers, and software. The round was led by Battery Ventures.

ABB Streamlines Business to Focus on Digital Industrial. The actions leaves ABB with #1 or #2 positions in electrification, industrial automation, robotics and discrete automation, and motion. ABB will return the majority of cash from the Power Grid divestment to shareholders.

Whole Foods and Instacart Part Ways. The wind down will occur through 2019 with a bulk of Instacart shoppers (part time staff who fulfill orders) expected to shift to other grocery partners such as Publix, Safeway, Kroger, and more. At it's peak, Whole Foods contributed to 10% of sales for Instacart.

Uber Looking to Deepen Relationship with Transport for London. Uber is seeking to incorporate already available data around bus and tube schedules to compete with Citymapper. Under Khosrowshahi, Uber is looking to facilitate mobility through private and public modes.

Amazon Plans Regional Air Hub in Ft. Worth, TX. The facility will go live next year and include sortation operations as well as the ability to handle it's growing scale and flight volumes.

Hyundai Plans $6.7B Investment to Boost Fuel Cell Production. The investment will occur through 2030 with a capacity to build 700k+ units (currently 3k). Fuel cells are competitive to ICE and electric by using hydrogen.

Continental to IPO Powertrain Business, Become Acquisitive in 2019. The IPO is slated for 2H 2019. $5B+ of proceeds from the IPO will be used towards ramping software competency via acquisitions.

Company Building

Managing Remote Teams. I've had remote staff and it requires some intentional process, communication standards, and rigorous approach to culture. Andreas Klinger, VP Engineer of Coinlist shares his thoughts.

Growth at Early Stage Enterprise Startups. Go-to-market is tough and the Head of Mid-Market Sales at Slack offers some of her thoughts around pilots, pricing, bottoms-up strategies, and more.

Which is More Important: New Account Growth or Account Expansion?. Tomas Tunguz on why new account growth is a better use of marketing spend and tends to be favored by venture investors. Ultimately, it's driven by the belief that distribution is the best long-term moat.

Building a Customer Centric Culture in B2B. Mathilde Collin, Co-founder and CEO of Front shares her approach. Few things stuck out to me: 1) Everyone at Front does support (Founders too!); 2) Public product roadmap; 3) Good and bad feedback is openly shared with team.

What We’re Listening To 🎧

Exponential View: Michael Liebreich on Climate Change and Technology. We've had the privelage of working with Michael around our investment partnership in Zeelo. He shares his thoughts on the US climate assessment, new energy, and technology.

Micromobility Podcast: Why Micromobility Platforms Matter. Dediu and Bruce discuss among other things: what a potential Apple entry into micromobility might look like; what platforms build on micromobility fleets might be like; network effects.

💥 The Future of Supply Chain: Building a Culture That Wins. Amari Ruff of Sudu joins me to share his story. Amari was homeless for a period in his youth but is now a repeat startup founder who discusses the diversity problem in our industry and how to be intentional around building a winning culture.

Who's Hiring? 👩‍💻

Product Manager at Sennder in Berlin, Germany.

Senior Account Executive at Stord in Atlanta, GA.

Front End Engineer at LogisticsExchange in New York, NY.

Check out other jobs at Dynamo portfolio companies.