Supply Chain Tech Monthly Roundup — May 2022 — Corporations & Automation
Welcome to the May monthly roundup of the supply chain tech industry where I’ll be providing quick tidbits and links about recent logistech news around companies, supply chain, trends, and innovation.
A few housekeeping things:
- If you want to get this newsletter directly to your inbox, subscribe here
- Follow me on Twitter where I share even more supply chain tech news here
In this month’s roundup:
- Corporations & Automation
- Fundraising, M&A, and Stocks
- Company News
- State of the Industry
- Companies Hiring
Corporations & Automation
Walmart is deploying Symbiotic’s AI and robotics tech in all 42 of their regional distribution centers. This deployment will take place over the next eight years. Last summer, Walmart announced that they were placing Symbiotic in just 25 of their regional DCs. The deal has since expanded. Symbiotic’s system will help with inventory accuracy and increase its warehouse capacity. This is all part of Walmart’s bigger plan to increase automation throughout their supply chain. They’ve committed to spending $14 billion in capital expenditures on automation this year to achieve this goal. Symbiotic plans to go public via a SoftBank SPAC during the first half of 2022 trading under the ticker symbol “SYM”.
DoraSorter robotic systems increase throughput at DHL’s Atlanta distribution center. The DoraSorter is made by Dorabot and is able to sort 1,000 pieces an hour. The DHL facility has two DoraSorters: one sorts packages into bags for distribution to 80 final-mile zip codes, and the second one sorts pieces into 20 different Gaylord containers. This is part of DHL eCommerce Solutions’ $300 million investment in operations improvements. Two more loop sorters will be installed in their Cincinnati and Chicago facilities. The sorters will be able to sort 40,000 to 50,000 pieces an hour.
UPS is putting RFID tags on packages to speed up throughput. These RFID tags are part of their smart package initiative which will be implemented at 100 facilities. UPS CEO Carol Tome says the initiative will eliminate 20 million manual scans and $500 million in non-operating costs. This is all part of their plan to increase automation across their operations. This year they will be opening two automated hubs in Pennsylvania and California with automated bagging and label application abilities.
Nomagic raises $22 million for its ecommerce warehouse picking robots. Khosla Ventures, Almaz Capital, and the European Investment Bank led the round. Nomagic’s robotic arms can identify and pick objects out of a box and then move or pack them in another place. The arms started out picking small electronics and related items then added bagged apparel and now they are exploring grocery items as well as other categories. Nomagic says they plan to use the money for growing and expanding its business.
GreyOrange, a warehouse robotics company, raises $110 million in growth financing. Mithril Capital Management and BlackRock provided the financing. There were rumors that the firm was looking to go public but it was likely placed on hold due to the market conditions. Their CEO Samay Kohli says it is a viable option in the future. In March, Walmart Canada announced they were opening a $118 million fulfillment center with GreyOrange systems installed. They plan to use the money to hire an additional 300 people and towards the rollout of their robotic systems.
Fundraising, M&A, and Stocks
Whew, what a month in fundraising in May! I track supply chain tech and supply chain adjacent fundraising (more on this at a later date) and so far in the month of May alone total fundraising announcements are over $2.2 billion.
Shopify acquires Deliverr for $2.1 billion in its largest acquisition to date. Shopify says that Deliverr will be merged into their existing logistics arm, Shopify Fulfillment Network (SFN), which is currently anchored by the warehouse robotics company 6 River Systems. This bigger logistics unit will be headed by their newly appointed chief executive of logistics, Aaron Brown. Deliverr was founded in 2017 and was last valued at $2 billion in November. Deliverr’s technology integrates third-party sellers into ecommerce sites such as Amazon and eBay and then helps them ship their products to customers in one to two days. Shopify’s goal is to create an end-to-end logistics platform to manage inventory from beginning to end across all sales channels. This puts them one step closer.
Motive, formerly known as KeepTruckin, raises $150 million Series F. The round was co-led by Insight Partners and Kleiner Perkins. The fleet management solution provider says it will be using the money to invest in artificial intelligence, expand its product suite, and grow its enterprise capabilities. The company changed its name to Motive in April because they are eventually planning to offer hardware and software solutions to industries outside of trucking and logistics. Motive is now valued at $2.85 billion.
Stord hits unicorn status after raising $120 million at a $1.3 billion valuation. Stord is a cloud-based logistics platform that offers supply chain services such as warehousing and fulfillment. As the WSJ points out, Stord sets itself apart from other supply chain tech startups in that they focus on multiple supply chain points such as freight booking, warehouse management, and shipment tracking. Whereas most other supply chain tech startups focus on one of these points. Stord plans to have hired over 1,000 people by the end of the year. They’ve also expanded their partnerships with existing customers — Coca-Cola and Dollar General. Its warehouse network has increased to more than 1,000 U.S. facilities.
Fashinza, a B2B supply chain marketplace for fashion brands, raises $100 million. The Series B round was co-led by Prosus Ventures and Westbridge. India-based Fashinza helps fashion brands find manufacturers, place bulk orders, and analyze trending fashion designs. They also target the production side by providing their software, FactoryOS, to factories for tasks related to sampling, inventory, and finance. Their software tracks the lifecycle of garments and uses this data to train algorithms to match brands with suppliers. They also use the data to help predict turnaround times. Fashinza plans to use the money for expansion into new markets and refining its supply chain technology.
Faire, a wholesale marketplace, raises a $416 million extension at a $12.59 billion valuation. Sequoia and Y Combinator contributed $196 million of the funding while the remaining $220 million came from existing investors. Faire connects independent businesses to retailers. The company says they have seen 3x YoY growth and see more than $1 billion in annual volume. Faire will be using the money for global expansion, hiring, and product development. One product they mentioned, in particular, is an “operating system for wholesale”.
GXO Logistics, the former warehousing arm of XPO, partners with investment firm Sente Foundry to invest in supply chain tech companies. For a year Sente will conduct a global search of technology companies focused on warehouse automation and innovation. Sente will be considering startups in all stages — prototype to commercialization. They will be specifically focusing on warehouse technology, robotics, supply chain tech, AI, IoT, e-commerce technology, and communications infrastructure. The chosen startups will get opportunities to work on pilot projects across GXO, R&D collaborations, strategic investments, joint ventures, or a go-to-market partnership. You can apply for investment here.
Often times venture capital funds will write blog posts about why they invested in a particular company. I think these can be insightful so I wanted to share a few “Why We Invested” posts about supply chain tech companies that recently raised money.
- Arcstone provides visibility into a company’s manufacturing systems. REFASHIOND Ventures, a supply chain-focused fund, discusses why they invested.
- Cambridge Capital, a private equity firm investing in supply chain companies, explains why they led a $56 million Series C round into Byrd. Byrd is a digital e-commerce fulfillment provider in Europe and UK.
- WeWork founder, Adam Neumann, is back and has somehow managed to raise $70 million selling tokenized carbon credits on the blockchain. The round was led by a16z’s crypto fund and they explain their investment here.
- Paccurate, a packaging optimization startup, raised a $2.2 million Seed round at the beginning of the month. Grand Ventures participated and explained why here.
- LocalGlobe writes about why they led GetHenry’s $17.4 million Seed round. GetHenry makes last-mile delivery e-bikes.
- Afore Capital invested in JABU again in their $15M Series A round. They first invested in JABU, a B2B marketplace, in 2021 and say that since then JABU has grown to 45x in monthly GMV and increased average transaction volume by 5x.
Lastly, pitch decks! Here is the pitch deck LogRock, a trucking insurance company, used to raise $3.5 million. Business Insider also showcased pitch decks from five different supply chain tech startups — Shipium, Tive, Exotec, Tealbook, and Bringg.
Company News
Walmart is rolling out drone delivery to four million US households. The retailer is partnering with DroneUp to offer drone delivery across six states — Arizona, Arkansas, Florida, Texas, Utah, and Virginia. They will be offering up to 100,000 different products from a variety of categories such as medicine, diapers, hot dog buns, and batteries. Customers will pay a $3.99 delivery fee and can order items totaling up to 10 pounds. The order will be fulfilled in the store, packaged, loaded into the remote-controlled drone, and delivered to customers via a cable that lowers the package to the ground. Walmart expects to make a million deliveries a year via drone. Walmart also noted that they thought customers would only use the service for emergency items but they’ve found that customers use it for sheer convenience as well. Fun fact: Their current top-selling drone-delivered item is Hamburger Helper. This will set Walmart up to have the largest drone delivery service in the U.S. beating out rivals — Amazon and Google.
Kraft Heinz is going to use the metaverse to solve its supply chain problems. Kraft is partnering with Microsoft to create digital twins of their manufacturing facilities in the “industrial metaverse.” Virtual versions of their facilities can give executives a view into how they are working and where they can make improvements. Kraft would be able to digitally map out a Kraft facility to simulate production and determine the best flow before actually running the product on the line. Ultimately, this could help speed up getting a new product to the market.
Volvo is partnering with DHL on hub-to-hub autonomous freight hauling. Volvo Autonomous Solutions (VAS) is fitting their Volvo VNL sleeper cabs with Aurora Driver, an autonomous driving system. VAS is working with Aurora to create a transport-as-a-service (TaaS) model. Nils Jaegar, the president of VAS, says this won’t just be autonomous trucks it will be an autonomous solution. DHL is spreading eggs across multiple autonomous trucking baskets having made deals with TuSimple and Embark Trucks.
TuSimple is delaying the commercialization of its autonomous trucks until 2025. The original target was 2024. They now plan to send prototypes to customers for testing in 2024 and roll out their fully integrated models in 2025. TuSimple’s CEO Xiaodi Hou assures us that there are no technology blockers they just need time. Other announcements from TuSimple include cutting back on the mapping needed for their Autonomous Freight Network, delaying their partnership with Union Pacific, and continuing to look into spinning off or selling their China operations.
Uber Eats is launching two autonomous delivery pilots in Los Angeles. Uber is partnering with two companies — Motional and Serve Robotics. Motional is an autonomous vehicle startup and this will be its first attempt at autonomous delivery. Motional will be handling longer-distance deliveries in Santa Monica. Serve Robotics is a robotics sidewalk delivery startup. They will be handling shorter distance deliveries in West Hollywood. Uber says the goal of these pilots is to learn what customers want, what merchants want, and what makes sense for delivery.
State of the Industry
The above chart comes from Blue Yonder’s Supply Chain & Logistics Executive Survey which highlights how senior executives are planning on tackling supply chain challenges this year.
CB Insights released their State of Supply Chain & Logistics Tech Q1 2022 report. Supply chain funding reached $9.4 billion across 223 deals in the first quarter of the year.
Pitney Bowes released their Parcel Shipping Index for 2021. Parcel volume grew 6% to 21.5 billion, carrier revenues exceeded all previous years at $188 billion, and parcel volume is forecasted to hit 25 to 40 billion by 2027.
Amazon is looking to sublet at least 10 million square feet of warehouse space as ecommerce demand slows.
More than half of Chief Supply Chain Officers are willing to sacrifice profit for sustainability.
According to DC Velocity, now is the time to be a logistics professional. 72% of logistic professionals saw a boost in their total compensation and the overall average salary was a little over $144,000.
On the flipside, Bloomberg says supply chain managers are throwing in the towel. Supply chain managers quit their jobs at the highest rate since 2016. Although stress is a contributing factor most are heading to higher-paying roles.
Check out this Stratechery post about Amazon-as-a-service where Ben Thompson discusses how Amazon is doing the same thing to its logistics business that it did with Amazon Web Services (AWS).
Zach Fredericks, product manager at Loadsmart and an early-stage logistics tech investor, wrote a thread about what supply chain tech trends he is excited about.
Curious about Transportation Management Systems (TMS)? Dynamo Ventures put together this TMS 101 guide.
Frazer Kinsley is the co-founder of Kinsley Partners (VC fund) and tweets about the DTC supply chain, put together this free supply chain playbook for DTC, CPG, and apparel brands.
Numbers:
- The jury is still out on warehouse robotics according to the 2022 Intralogistics Robotics Survey. 48% of respondents said they have no plans to use robots at this time.
- The piece-picking robot market is expected to surpass $3 billion by 2026 (a 63% compound annual growth rate).
- According to Zebra’s Warehousing Vision Survey, 90% of warehouse operators say they need to implement new technology to stay competitive in the on-demand economy.
- Orders for workplace robots have increased 40% in Q1 2022 compared to Q1 2021 according to the Wall Street Journal.
- 41% of respondents indicated that managing multiple carriers was viewed as a pain point according to Bringg’s 2022 State of Last Mile Logistics report.
Audio recordings/podcasts to check out:
- #125: Anthony Sutardja of Parade AI — Dynamo Ventures
- Shipping Soulmates: 3PL Matchmaking For E-commerce Growth with Matthew Hertz, Co-founder of Second Marathon — How to Unf*ck Your Supply Chain
- The Bootstrapper’s Guide to Logistics: Not Stealth For Long on Apple Podcasts (interview with PopCapacity CEO & cofounder Matt Fain)
NRF Supply Chain 360 takes place June 20–21, 2022 in Cleveland, OH.
FreightWaves and PYMNTS are putting together a live event: Supply Chain Meets FinTech. The event will be held in Atlanta, GA on August 17th, 2022.
Companies Hiring
- Data Scientist — Remote
- Product Strategy & Analytics Associate — Remote
- Lead Product Designer — Remote
- Customer Success Manager — Atlanta
- Solutions Consultant — Atlanta
- Associate Product Manager — Atlanta
- Solutions Engineer — Remote or Wilmington, MA
- Robotics Test Engineer — Wilmington, MA
- Automation Manager — New Braunfels, TX
Walmart is also hiring several roles centered around its supply chain automation initiatives. Some of the job titles:
- Staff Automation Engineer — Bentonville, AR
- Sr Automation Engineer, Advanced Robotics — Bentonville, AR
- Principal Product Manager, Inventory Intelligence — Dallas, TX
- 2022 Campus FT: MBA Senior Manager I, Product Management Market Fulfillment Center — Sunnyvale, CA
- Product Associate III, Last Mile — Bentonville, AR
