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 💭

It’s been a quiet week over at the Dynamo HQ.

🎙If you haven’t checked out our podcast, The Future Of Supply Chain, you’re missing out! We sit down with a different entrepreneur, investor, or industry veteran to discuss innovation, technology, and the most exciting opportunities in supply chain.

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Clay, Santosh, Jon, and the rest of the Dynamo team

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Supply Chain 📦

🌟Biden Signs OSRA-22 Shipping Reform Into Law. This is the US’ first major shipping reform in more than two decades (let that sink in). It gives maritime regulators greater oversight over container storage fees and the ability to monitor whether ocean carriers are adhering to soon-to-be revised rules on loading exports. The Senate’s version of the bipartisan bill allocates the Federal Maritime Commission (FMC) $164M through 2025, a bump up from the House’s version that authorized $68.5M through 2023. The FMC will hire more staff, including another administrative law judge, to increase monitoring of international ocean transportation and initiate rulemaking regarding fair export practices. For other developments in US national supply chain matters, see Mediation Between Freight Railroads And Unions Fails and Biden Calls For Oil And Gas Companies To Reduce Fuel Prices.

Farm Crops Get Wasted In The UK Due To Lack Of Workers. The National Farmers' Union reported that good food is routinely going to waste on farms across the country due to a lack of workers. This is despite more people relying on food banks and an increase in the cost of many products since the war in Ukraine. Additionally, the commentary highlighted that labor shortages arose from issues across the whole supply chain and "not just because of a lack of seasonal workers post-Brexit." Despite Layoffs Signaling Uncertain Times In Logistics Tech Sector, companies such as Samsara Continue Improving Employee Management Platforms amid supply chain's labor market uncertainty.

Spot Intermodal Shippers Turn To Trucking Amid Rate Declines. US domestic intermodal customers who ship cargo on the spot market are beginning to bypass rail in favor of long-haul trucking because the diminishing savings aren’t enough to warrant the extra time in transit. The JOC Intermodal Savings Index indicates the average shipper saved 10% nationally in May shipping via rail, down from 30% in January. More specifically, spot truckload rates on indexed lanes fell 41 cents between January and May, while spot intermodal rates rose 21 cents during the same period, eroding the price advantage to use rail on one-off loads. For more news in the railroad industry, see LTG Cargo To Resume Vital Exports From Ukraine Via Rail and How Technology Can Bring About Freight Rail Renaissance.

Retail Sales To Be More Challenging In 2H2022. US May retail sales are softer than expected, falling 0.3% m/m while April was revised down to 0.7% from 0.9%. Despite the disappointment, this leaves retail sales running 27.9% above the February 2020 level, massively outperforming spending on services given the limited options available for leisure and recreation during the pandemic. That said, rising borrowing costs and falling household wealth, as well as concerns about the rate of wage inflation risk dampening adults’ spending power on everything but their children's toys following Lego's Plans Of Spending $1B On A New US Factory despite the recent Surprising Factories' Output Decline.

Truckloads Costs Keep Climbing For US Shippers. Shippers continue to pay more for trucking and transportation services despite a marked drop in truckload spot rates. The US producer price indexes (PPI) for trucking in May showed LTL rising 4.1% while LTL increased 3.8% from April. The strength of the PPI indexes runs counter to reports of trucking having reached a turning point in its pricing cycle, spurred by falling spot truckload rates as shippers shift freight away from the transactional spot market to contracts. S&P Global forecasts that trucking PPIs will continue rising through early 2023 before dropping, but not falling to pre-pandemic levels. For more news in the trucking industry, see May Trailer Orders At Year’s Low and Used Truck Auction Prices Plunge As Freight Market Cools.

Logistics Innovators Poised To Win As American Businesses Come Home. As businesses try to adapt the centrality of logistics to their operations, both technology adoption and capital allocation have accelerated to meet the moment. Industrial surveys have found over and over that US businesses want to reshore substantial parts of their operations closer to home. The appetite for integrating better technologies and reshoring is acute in critical sectors like pharmaceuticals, semiconductors, and defense hardware. In the next decade, market participants are expected to spend private and public capital worth tens of billions of dollars to develop the technical infrastructure needed to strengthen many sectors in the US. Despite the increasing interest in reshoring, the Port Of LA Still Reported 'No Precipitous Drop' In Ships Leaving China while Container Shippers Tap Into Ro/Ro Capacity Amid Tight Vessel Space.

How 5G Connectivity Can Enhance Autonomy. In the case of improving material flow, the use of autonomous mobile robots (AMRs) in conjunction with other computing and connectivity technologies is often the best solution. For efficient processes and operations, AMRs must get the right job assignment at the right time, can perform the task when it is expected, and coordinate well with other AMRs and site conditions. Despite AMRs working well with Wi-Fi, local on-site 5G connectivity improves AMR performance on bandwidth, latency, reliability, and massive IoT connectivity. For more news about autonomy, see Grubhub Plans To Roll Out Delivery Robots and Waymo Tops NHTSA’s List For Autonomous Vehicle Crashes.

An Interview With Okta CEO Todd McKinnon About Security In Supply Chains. Back in January, identity-management provider Okta experienced a security breach after hackers posted images they said were of the company’s internal systems. Okta’s response was to be transparent with the public but it ended up biting them in the tail and caused confusion. Ben Thompson sat down with Okta’s CEO to get the inside scoop regarding their investigation, the response, and how to handle supply chain security breaches in the future.

Mobility 🚗

🌟Sony, Honda Sign Agreement for Joint EV Brand. The partnership will form a new company called Sony Honda Mobility, with both owning a 50% stake in the new brand. This partnership could give both companies hope of competing with Tesla on the EV front. Sony will bring its technical and entertainment expertise while Honda brings its manufacturing infrastructure. This allows the potential product to compete with Tesla’s smart car capabilities as well as its driving efficiency. The car is projected to hit the market by 2025. In other news, consider reading Why Wireless Charging Matters More for EVs and NTA Announces Historic Agreement For 800 Battery-Electric Buses.

Overview of Autonomous Driving Regulations in the US. This is a report on the updated legal infrastructure in the US for AVs by state. Texas is arguably the most lenient for testing AVs, while California and parts of the east coast are more comprehensive and restrictive of who can test and when (this fits with the number of AV tests we’re seeing in Texas). As an overall trend, regulation is finally receiving the attention it needs after being stagnant for the last couple of years. In other news, Self-Driving Cars Crash, Too, But Figuring Out What It Means Requires Much Better Data.

Ford Inventory Will Be Roughly Half Of Pre-Pandemic Levels. Before the chip shortage, it was normal to see 90 days supply of inventory at dealerships. That target has been cut to around 45-50 days. Ford plans to have pickup and delivery services at its dealers by next year to try and compensate for a drop in the customer experience. An undercurrent of this supply backup is that we could be seeing a lot more innovations in the car buying process. There is a lot of pessimism that full inventory will come back anytime soon. In related news, check out Tesla Pauses Hiring As Musk Aims For 10% Staff Cut, Reuters Says and GM Investing $81M To Hand Build Ultra-Exclusive Cadillac Celestiq Electric Cars.

Buttigieg Considers Punishing Airlines For Flight Disruptions. Potential actions by the Department of Transportation could be small fines for airlines failing to meet consumer protection standards. The USDOT might also push airlines to hire faster to stave off the worker shortage. Historical punishment has been relatively small, the closest comp being a $2M fine on Air Canada for refund delays, but the current situation is relatively unprecedented. In related news, check out Airline Lobby Chief Says Carriers Can Ride Out Economic Squeeze and Airline Staff Shortages Expected To Last Into 2023.

4 Automakers Ask US Government To Lift Cap On $7.5K EV Tax Credit. Ford, GM, Stellantis, and Toyota are asking the US government to remove the cap on consumer incentives for buying EVs. The main argument of the lift is that the unforeseen supply shock has decreased EV affordability for consumers. The current cap, which is 200K vehicles per automaker, was originally made in 2008 when legislators thought companies that sold more than 200K vehicles would have reached economies of scale and lowered prices. In reality, the supply chain crunch has foiled those predictions as only GM has announced it would lower the price of some of its EVs during the crisis. In other news, consider reading VW Will Surpass Tesla EV Sales By 2024 New Report Says and Toyota To Halt More Japan Production In June, July.

Tesla Raises Prices In The US As Inflation Chips Away At Its Profit Margins. Tesla has raised prices on all of its models in the US by around 5%, the third price increase since March. The Model Y costs 25% more than it did in Jan 2021. The supply backlog and foreign competition could result in a decrease in demand. This could be ramped up by the fact that the estimated delivery window for a Model Y bought today is Jan 2023 to April 2023. In other news, Tesla Expands Supercharger Pilot Program For Non-Tesla EV Owners To A Large Part Of Europe and Tesla Is Sending Untrained Employees To Work On Cars As Service Becomes Problematic.

The Peculiar Economics Of Autonomous Cabs. The biggest cost that companies are targeting to reduce comes eliminating the driver (hence why robotaxis are gaining attention). However, this does not mitigate other costs associated with mobility on demand like the inefficient matching process–a great deal of time is spent trying to match the driver with the passenger. If robotaxi ventures don’t tackle this problem they’re only going to recover a fraction of what they’re hoping from eliminating the human driver component. There are also continuous questions regarding feasibility that have still yet to be answered for the industry. In other news, look at Lime Deploys New Batteries To Improve Rider Experience.

Fundraises and M&A 💸

Khazenly Raises $2.5M Led By Arzan Venture Capital And Shorooq Partners. Khazenly is an Egypt-based on-demand warehousing and fulfillment platform. The platform uses AI and big data to inform merchants on what products to stock concerning location and demand. The funds will be used to quadruple the company’s facilities as it follows a roadmap of building more AI and data-driven products and expanding geographically.

Opply Raises $4M Led By Chalfen Ventures And Anthemis Group. Opply is an ordering platform for food and beverage ingredients. It aims to disrupt how SME food and beverage brands find, communicate, and order from suppliers. The funds will be used to expand its engineering and commercial teams.

Corvus Raises $5M Led By Spero Ventures. Corvus is using drones to track warehouse inventory. It’s a solution that’s been difficult to achieve solely with wheeled robots, which have quite a bit of trouble reaching those top shelves. The funds will be used to scale its technology and advance R&D.

Moova Raises $10M. Moova is an Argentina-based last-mile digital platform for urban logistics providers. Investors include Alaya Capital, FJ Labs, Wayra Telefónica, Matterscale, Kalei Ventures, IThink, Parser Digital, Reflect Ventures, Murchinson VC, and Insudpharma. The startup currently operates in eight countries (Argentina, Uruguay, Chile, Bolivia, Peru, Colombia, Guatemala, and Mexico) and will launch US operations this year.

Chain.io Raises $11M Led By Fontinalis Partners And High Alpha. Chain.io is a cloud-based supply chain integration platform designed to optimize supply chain processes. Additional investors include Mercury, Grand Ventures, Eve Atlas, and Waybury Capital. The company will grow its network and add more native connectivity to its transportation and supply chain platforms and expand across North America, Europe, and Asia.

Peckwater Brands Raises £15M Led By Stonegate Group. Peckwater Brands offers delivery franchises to kitchen operators. Additional investors include Softbank, Fuel Ventures, and Pembroke VCT. The funds will be used to accelerate geographic expansion.

bttn Raises $20M Led By Tiger Global. bttn enables medical practitioners, businesses, and emergency responders to buy name-brand medical supplies online. The company has access to over 2.5M medical supplies on its platform. The funds will be used to scale and accelerate growth.

General Radar Corp. Raises $22M Led By Octave Ventures. General Radar is a developer of high-resolution 3D radar systems. It focuses on serving customers in the aerospace and defense, wind energy, autonomy, and weather sectors. Additional investors include Disruptive and Kleiner Perkins.

Battery Smart Raises $25M Led By Tiger Global. Battery Smart is an India-based battery-swapping network for EVs. Launched in June 2020, the company operates in 10 cities and recently hit a milestone of 1M swaps. The funds will be used to meet capital and R&D expenditures.

Arkestro Raises $26M Series A. Arkestro is a procurement platform that uses game theory and machine learning to find the best prices automatically. The round was led by NEA, Construct, Koch Disruptive Technologies, and Four More Capital. The funds will be used to scale its platform.

Distribusion Raises €30M Led By Lightrock. Distribusion is automating the ground transportation industry through its B2B marketplace and standardization technology. Its system connects hundreds of bus, rail, and public transport providers to a global network of travel retailers. The funds will be used to connect more carriers and expand to new geographies.

Dastgyr Technologies Raises $37M Led By Veon Ventures. Dastgyr is a Pakistan-based B2B eComm marketplace that connects retailers with suppliers. Dastgyr is currently operating in five cities and is used by 100K+ retailers. The funds will be used to expand its geographic footprint and product offerings.

Hai Robotics Raises $100M Led By Capital Today. Hai Robotics is a developer of AI-enabled robotic solutions for warehouses and factories. Additional investors include 5Y Capital, Source Code Capital, Sequoia Capital China, and 01VC. The funds will be used for R&D and global business expansion.

PayCargo Raises $130M Led By Blackstone Growth. PayCargo is a payments platform for the freight industry. According to its CEO, the company moved over $10B in payments last year and is on pace for $20B in 2022. The funds will be used to expand its platform.

Echodyne Raises $135M Led By Bill Gates And Baillie Gifford. Echodyne designs and manufactures high-performance radars. Additional investors include Northrop Grumman, NEA, Madrona Ventures, Vulcan Capital, and Vanedge Capital. The funds will enable the company to grow beyond defense and federal contracts into other mobility markets.

Overair Raises $145M Led By Hanwa Group. Overair designs, develops, and manufactures electric vertical takeoff and landing (eVTOL) aircraft. As the company continues to work towards FAA certification, it is also working with NASA and Urban Movement Labs in Los Angeles to develop urban air mobility (UAM) routing and infrastructure. The funds will be used to fly its all-electric experimental prototype in the second half of 2023.

Metropolis Raises $167M Led By 3L Capital And Assembly Ventures. Metropolis is an AI-powered parking platform. It has also recently acquired Premier Parking, a Nashville-based company that operated hundreds of parking garages and spaces around the US. The funds will be put towards product development, expanding the company’s team, and expanding into new mobility adjacent verticals.

Rohlik Raises €220M Led By Sofina. Rohlik is a Czech-based grocery delivery company. It currently operates in Czechia, Hungary, Austria, and Germany. The funds will be used to finance greater automation and electrification of its operations as well as to enter new markets.

GoBolt Acquires BoxKnight. Tech-enabled fulfillment and last-mile delivery startup, GoBolt has acquired eComm logistics provider BoxKnight. According to GoBolt’s CEO, the acquisition of BoxKnight fits within the firm’s vision “to make logistics easier than the purchase itself” and aids GoBolt’s move into the small parcel delivery space. As part of the deal, BoxKnight’s entire 35-member office team is joining GoBolt.

Blink Charging Acquires SemaConnect For $200M. Blink Charging, an operator and provider of EV charging equipment and services is acquiring Sema Connect, a provider of EV charging infrastructure in North America. The acquisition will add 13K EV chargers to Blink’s existing footprint. Blink will also benefit from SemaConnect’s in-house R&D, hardware design, and manufacturing capabilities

Shiprocket Acquires Majority Stake in Pickrr For $200M. 3PL startup Shiprocket has acquired competitor Pickrr. The acquisition will increase Shiprocket’s total volumes by 40%. While Pickrr is among its major acquisitions, it has closed four other M&As this year including customer data firm Wigzo Tech, B2B logistics company Rocketbox, and supply chain management firm Glaucus.

SPAC Radar📡

Holisto In $405M Deal With Moringa Acquisition. Holisto is an Israel-based online travel booking platform. Holisto’s expected implied pro forma equity value is approximately $405M, based on a $10 share price. The companies have also entered into a securities purchase agreement with a non-affiliated investor in which the investor would purchase a $30M senior secured convertible note from Holisto.

Who's Hiring? 👩‍💻

Customer Success Manager at Stord in Atlanta, GA (remote ok).

Senior Front End Developer at Milk Moovement in St. John’s, Halifax (remote ok).

Marketing Manager at Tangram Vision in Boulder, CO (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.