Supply Chain Now Episode 434

“My goal is to inform, enlighten and inspire you in your own supply chain tech journey.”

-Greg White, Host of TECHquila Sunrise

 

The ‘TECHquila Sunrise’ Series on Supply Chain Now shares the latest investments, acquisitions, innovations, and glorious implosions in Supply Chain Tech every week. If you are looking for a podcast about ‘so-and-so signed a contract with such and such,’ or ‘they just released version 20 of that same technology you didn’t buy last year,’ this is the wrong podcast for you. But if you are looking for real news and innovation, welcome to the Sunrise.

 

Greg White (00:00):

This week at tequila sunrise, I’m going to share the coolness of some of my favorite supply chain tech startups, and your lesson for the week is that I get to do that kind of stuff instead of investment lessons, because it’s 3:00 AM and no one is awake to stop me. Of course, we talk about the plethora of funding deals as well. And the tequila, sunrise ply chain tech stock index listen up. It’s time to wake up to tequila. Sunrise we’re unfortunately, without the aid of tequila, we opened your eyes to how startups and venture investing. Tech’s focused on supply chain tech every week, this unholy hour of the day. If you want a taste of how tech startup growth and investment is done, join me every Thursday for another blinding tequila, sunrise, Greg white here from supply chain. Now I am always happy, never satisfied, willing to acknowledge reality, but refusing to be bound by it.

Greg White (01:10):

My goal is to inform, enlighten and inspire you in your own supply chain tech journey. Hey, in case you’re listening in supply chain now main channel, you should know, you need to subscribe to tequila, sunrise, wherever you get, your podcasts will only be in the mainstream for a couple of weeks more. Go subscribe to tequila sunrise today. So you don’t miss a thing. Hey, do you think supply chain is boring? Lots of people do. My father in fact, was a retail merchandising VP back when a company called Kmart actually mattered and there was no such term as supply chain, believe me. He thinks it’s not only boring, but also that procurement purchasing logistics, warehouse and transportation, people are a pain in the ass. You might feel the same way, or you might just be awakening to this thing. We love to call supply chain wondering what all the fuss is about or hoping to increase your supply chain IQ and impress your friends at your next zoom happy hour.

Greg White (02:11):

And you want to know how you can learn more about it? Well, if you want to build your knowledge in supply chain, you need to listen to get this supply chain is boring. That’s right. Supply chain is boring with Chris Barnes. Chris is a practitioner. He knows distribution logistics, apex, and about a hundred other acronyms. But more importantly, Chris knows the who’s, who that got supply chain, where we are that point us to where we’re going and take us to the next level in supply chain practice. He interviews creators, inventors, and innovators that made supply chain, the facet, native Lee, boring discipline. It is today. Chris challenges, every guest to convince him that supply chain ain’t boring. So you know what I’m going to say, listen up and subscribe wherever you get your podcasts. Let’s see who’s up to the task of proving supply chain.

Greg White (03:08):

Isn’t boring. Hey, this is another supply chain now joint. So be careful. You might just find boring. Interesting. Alright. I’m not even sure I’m ready to do this, but it’s that time a week. So this could be a little bit of a crazy episode, so, but let’s do see what’s going on in supply chain tech this week, I’m still hearing and seeing that small deals are still way down from last year. It does seem like things are heating up. At least behind the scenes. A lot of VCs are looking for companies worthy of investment companies with big growth are getting big multiples and bargain hunting continues for less than astronomical growth companies. This week we had 236 funding rounds for $7.8 billion and 83 acquisitions for 14 billion. Several firms have been pretty active and I’ll put a link to a great Crunchbase article in the show notes that talks about one firm and list the others that are active stay active founders, stay in the game.

Greg White (04:10):

It’s coming around. All right, as for the tequila sunrise supply chain tech stock index, the market jumped out of the gate Tuesday, much like it did for many stocks last Wednesday before Malays and trailing off throughout the week. We’ll see how it sustains this week. As bad as last week was in the market for supply chain tech this week has been a comeback with many clocking significant gains on the general rebounds in the tech market over the week. There are just so many supply chain funding deals this week, and we’re barely scratching the surface. I’m going to go through these deals, give you a quick take. And then we’re going to have a little bit of fun. Just kind of kick back and talk about some of my favorite tech companies. Let’s talk about a few of these. Let me assure you that supply chain tech is in.

Greg White (05:03):

So a company called Axel received a $27.7 million boost of debt and equity financing to advance its platform that manages cash flow for freight brokers. This is pretty cool. Anthemis and Techstars Techstars, big nationwide investor participated in the round. That includes $2.7 million in equity and $25 million in debt financing. So in January axle raised a $1.4 million pre-seed round led by trucks, venture capital. You can call this an a round and their sales must be banging to take on this much debt. It appears the debt will be used to provide the company with additional lending capability. Axle is built to help freight forwarders and brokers provide quick pay solutions to carriers that methodology when brought to the market over the last several months by big carriers has hurt some of the smaller freight forwarders and brokers. Over the past 12 months, axle has processed millions of dollars in invoices and continues to grow it.

Greg White (06:02):

Get this over 40% month over month. The article on this raise and the problem they solve is definitely worth a read I’d love to hear from Jayman Enrique Alvarez or other freight gurus on their take on this company and the market that it’s approaching. I’d love to hear some experts sound off it’s in the show notes, and I’ll forward it directly to you. If you hit me up on LinkedIn or Twitter, Gregory S. White Makena rocks, a Seoul, South Korea based industrial AI solution startup focused on manufacturing raised 10 million in series a funding, a few episodes back. We talked about how people were funding companies in South Korea because there weren’t as many companies in the market in the States because of the COVID shut down here. And soul had gone back to business as usual or more usual, a little bit earlier. Makena rocks specializes in an industrial AI tool set with a primary focus on intelligent control for anomaly detection.

Greg White (07:01):

Meaning is the machine breaking down. The company has already collaborated with its major corporations in various industries to apply this solution to a wide range of product lines, its solutions enhance the product and product processes of various industries, such as semiconductors, automobiles, batteries, and energy backers included LG technology ventures. Yes, that LG Hyundai motors applied ventures, financial investors, Korea development bank de song, venture capital shin Han investment corporation, and H B investment. This company wants to use the funds to expand its portfolio and get this develop a software as a service platform, SAS platform built on the existing on premise solutions to secure domestic and international customers. They’re going to hire data analysts, AI developers, and business development people. So that means they are taking this on premise solution in 2020 to the cloud. So in their 2018 seed round, they received funding from SK telecom Hyundai, motors and NAVAIR.

Greg White (08:08):

This one is interesting because, well, it’s in South Korea. They are a little late to the cloud party, a decade or so, but better, late than never having taken a company from on prem to cloud architecture myself back in 2011, I can tell you that it is not a small lift from either a tech development or revenue model standpoint to do this. I’ll be interested to see how this company fares parcel a San Francisco, California based connected worker platform raise $60 million in series D funding series D. So that’s fourth major round of funding parcels connected worker platform enables employees to collaboratively execute their work using digital work instructions on mobile devices, meaning step by step instructions on how to do X install, a new compressor on an atrium unit. That sort of thing. In addition to measuring every step and action workers can raise issues and provide feedback in real time so that every process is quickly analyzed and improved.

Greg White (09:10):

So with parcel companies get visibility into their operations, uncovered detailed data about their work processes and attract more talent, which is desperately needed in some of these trade industries. Customers include that list of companies here is incredible core Teva. Agriscience Grupo, bimbo, Georgia, Pacific Henkel, shell Suntory, and a whole bunch of other global producers of consumer packaged goods, PA paper and packaging, transportation, and energy. This company’s platform is deployed already in 130 countries in 14 languages. So the round of funding brings total funding to date, to just in excess of $133 million. It was co-led by new investors, activate capital and Glade Brook capital partners with participation from other new investors like Cisco investments and existing investors, Lightspeed ventures, big fund future fund another one and B 37 ventures as well as a number more than deal also includes strategic investments from Honeywell. Yeah. And Saudi Aramco energy ventures, the company will get two new board members and a board observer yeah.

Greg White (10:26):

On this funding. And what they want use the funds to do is accelerate growth in several international markets invest in their network of global partners and integrations and further extend the capabilities of the platform. Okay. Here’s a really interesting tidbit on this thing. Forbes reports that that valuation was not discussed closed for this round, but that parcel says it was a quote unquote up round, meaning the valuation of the company. Yeah. This round was higher than the valuation from the previous round. The valuation from the previous round of investment in 2018 was $250 million. When parcel was apparently doing $5 million in revenue. That is a massive valuation of 50 times revenue, 50 X. So forget about 10 X. They went 50 X, the company doubled revenue in 2019 to $10 million. This round of funding was oversubscribed, meaning they only wanted $40 million and they got more than that than they were actually asking for and got the full 60 million.

Greg White (11:33):

So these are good indicators if they maintained valuation rate, which I doubt meaning I don’t think they’re at 50 X revenue anymore. This company would be worth over $500 million and with $133 million in investment, that is a good return. Chances are better that it’s lower than X valuation. There are some signals there in the way that they reported. They felt the need to note that it’s not a down round at a lower valuation. And to say that it was an up round. So it’s probably not as up as the previous round, but still they appear to be growing well again, another great one to take a look at and keep your eyes on parcel pattern, salt Lake city, Utah based global eCommerce business solutions provider closed $52 million first round of funding. Now less, do you think this is a startup? This company was founded in 2013.

Greg White (12:28):

They use this technology and data to help brands gain profitable e-commerce growth on both their own websites, as well as on global marketplaces like Amazon, Walmart, eBay, Google team, all J D and Mercado Libris its offerings include products called predict and shelf. And those help brands use data-driven views into their eCommerce operations or performance ACOs across key metrics like SEO, advertising ratings and reviews, pricing, competitive anus, global distribution, and more. The company has over 400 employees. They have 18 global locations and they serve brands like Nestle, Panasonic, zebra, and Skechers plus more. The round was co-led by Ange advisory and KSB global. And what the company wants to use the funds for is to keep developing tools, to make decisions based on real time data. So these folks at pattern are helping e-commerce CPG brands, make good decisions, position their product better, promote it, better, understand how consumers evaluate it, see it, rate it and use all of that data to make the marketplaces that they’re selling in.

Greg White (13:45):

Be those stores or online much, much more effective they’ve been around for awhile. And now they’re just now seeking funding. There’s not a whole lot of news on this company, yet. At least there wasn’t. When this released could be interesting to watch, you can do a lot of damage with $52 million. All right. Here’s the thing I get to talk to some really cool companies all the time and what I’d like to do today rather than a formal education session and for no particular reason other than I just felt like doing it. I’d like to give a shout out to a bunch of these companies just kind of riff on these things and I’ve had my eyes on or capital in, or just observed that are doing some really, really cool things. So you may have heard me talk about Verisign before. So I’m an advisor to Verisign, but the cool thing about this company thing that really gets me excited about this company is they are making waves in MRO.

Greg White (14:40):

And if you don’t know what MRO is, that’s maintenance, repair, and operations. That’s the stuff that keeps plants right. To build the products that we buy pulleys and bearings. And what they do is they do this thing called data harmonization. They make sure that if call it a bucket and I call it a pale, it’s the same product we identified as the same. And we can use the inventory better instead of having a hundred buckets and a hundred pails, we recognize that we have 200 bucket pails and we can use those interchangeably and believe it or not, that is a big, big problem in MRO. What really has me compelled to think and talk and share about this company is that they are going to grow nearly 10 X this year in revenue because they built a solution that reduces MRO costs by tens of millions of dollars in less, then six months, often inland, less than four months.

Greg White (15:34):

And that is unbelievable in terms of implementation and results. Timeline. This whole team is stellar. Paul Noble, Jeff Wilson, Darryl Lou, Robert, Peter. I can’t even name them all. They are so singularly focused. They are collaborative and they are clearly interested in solving this problem. I know they’ll go far. Another one. This is really interesting. Eros Faizi and Roshaun. The Nash of Iran are the founders cofounders of a company called cipher. Nothing, almost nothing to do with supply chain, but it’s just such a cool application that I have to tell you about it. This is a cybersecurity app that they started with an appliance that you can just plug in to your home router and it starts protecting your entire network, every device in seconds. And now they’ve built the technology so that it can reside on your ISP, your internet service providers network on their servers, on their network.

Greg White (16:33):

And it just works to protect your devices. Yeah. It protects your devices using your internet service providers servers. Please don’t ask how they do that. I don’t know. Hopefully we can get Eros to share that with us. They are@cipher.co. So if you want to check them out, take a look at that. But this thing is so simple to use that even I can use it in that’s miraculous. So this is great for consumers as well as corporations. They had this whole plan. They’re already working with some regional ISP, great folks, great team, again, the key and, and a great market. Now we’re going to get serious. Okay. Now we’re going to get into serious fun anyway. So flourish. You’ve probably heard me talk about this company. I’m on the board of directors of this company. So I’ve gotten to get a really, really intimate look at this company.

Greg White (17:25):

So Colton Griffin, in fact, the CEO of flourish will be our first guest ever on tequila sunrise. So I don’t want to give up the whole goods on this company, but suffice it to say cannabis. Yeah, weed supply chain. And the whole solution is about your ability to never lose so much as a leaf in tracking and tracing this product. We’ve already recorded the interview with. So it’ll be coming out soon. It’s going to be good. He’s an interesting cat, a supply chain expert who went into the cannabis industry. And that’s the inverse of how most companies have attacked this. His co-founders won and Bennett also supply chain and technology experts that kind of stumbled not literally into the cannabis industry and have built this solution. And it is rock in the market. So light him up and listen up for that one. And as long as we’re on the topic of weed, just today, I talked with Sarah and Phil at growth, Sayer growth, Sayer.

Greg White (18:27):

Okay. Admit it. That is a cool name, what they have done. And this is close to my heart. They have simplified and advanced forecasting planning, replenishment for the cannabis industry. So think all of the dispensary’s, they got to know how many pre-rolls Raul already rolled joints, how much flour, which is the actual weed, how many edibles and various other products need to be in a particular store? You know, when, and in what quantity they’re using AI to improve the forecasting and the roll up of demand upstream. And they are moving towards forecasting, the customer and what influences customer purchases. You know, that I have mandated that forecasting go this way. You are not forecasting items. You are most definitely forecasting the customer and what makes them act. So this team has gotten the message and this app is so smart. It makes decisions for you.

Greg White (19:22):

So that’s really great. If you’re stoned out of your gourd or just busy as hell, making customers happy, it’s a great solution to make sure dispensary’s manufacturers and growers have what they need when it’s time to supply. So we’re moving out of weed into Canada. So the next couple of companies, both from Canada, so rhythmic, R I T H M I K, of course, it’s tech company. We have to misspell it, this Canadian bunch of geeks. And I mean it, they are doing cool stuff. Chris is Feld and Kevin Urbanski. They are deep mining geeks. I was on a call with these guys, man. They had, they knowed mining in side out and they’ve built this technology. And fortunately, they’ve got some adult supervision, their CEO, Amanda, true. Scott is making connections with big equipment companies, driving the vision and Marty marketing. It’s a great team dynamic, but you want to talk about a niche.

Greg White (20:20):

Imagine you have a bunch of giant machines on a mine site. One of those machines goes down, not only do the repairs cost you up to half of your operating budget. That’s just astounding. Plus the potential of millions in lost production. That’s a big, big deal. You plug this monitoring application into that big old dump truck. And it tells you when something needs to be repaired to avoid a breakdown. It says to you, Hey, the flux capacitor is out of whack. It’ll last another 30 days. You better order. Now of course they use AI IOT, API APIs, and a bunch of other acronyms to make this happen. But this stuff works in the roughest, dirtiest and most dangerous conditions. Apparently these big dump trucks and mine sites provide more beating than planes, trains, or even semi-trucks take. It’s a really cool solution. Give them a look just for interest. And if you are a founder, understand that you can find a really tight niche and make a bundle and really make a difference. Okay, this next one also Canadian. I’m not even sure I’m allowed to talk about this one. What the hell? I’m I think she’ll forgive me. Sarah Barnes Humphrey, who is also on let’s talk supply chain is rolling out a company called

Greg White (21:38):

S H I P Z.

Greg White (21:40):

Of course, tech company has to be misspelled. This is an ocean and air freight marketplace that connects shippers with forwarders and carriers without wasting anyone’s time. Apparently there’s this problem where, you know, it’s hard to find a, a forwarder or a carrier to take your freight, but there’s also this issue where shippers just kind of toss requests out there for information, and just hope that somebody bites and it takes up a lot of forwarders time when there’s not really a load that they’re going to actually win the opportunity to move. Sarah was literally born to do this. She got the idea from working with her father’s company in the logistics industry. And this thing is built to reduce market friction and streamline the quoting and the booking process for air and ocean freight, with all the disruptions for airlines, ocean carriers, and shippers alike. During this crisis, I love where this market is going.

Greg White (22:34):

And Sarah and her team will be a great catalyst to marketplace efficiency. This has happened in a lot in trucking, but there is just a lot again, of industry knowledge here that I think is really, really valued and valuable. And it’s being instilled in the product and you can’t overstate the benefit of that industry knowledge so that the technology doesn’t have to learn by making mistakes. It learns from taking the input of experts in the industry. And that’s really incredibly accelerative for a technology company. Man, there are so many more I’d like to dig into, but I only have time for mention of a few more this time, honorable mentions, I guess, this time around, but we’ll probably get into them later automated intelligence, which is a cool digital twin technology shelf aware which allows you. And that’s in the MRO space. Also, we need to connect them with Verisign.

Greg White (23:30):

Andrew, if you are listening, we’re going to connect you with Paul Noble at Farrison. Uh, but shelfware helps companies manage their inventories better. And then source connect, which is a company Kevin L. Jackson has been on the show he’s COO and they help companies manage their diverse supplier networks. And it’s an incredible accelerant to that as well. I’m sure there are a few that I’ve missed and I’m going to get some of those WTF messages. We’ll get to you another time. I promise. Shout out, shout your name. I’m apologize if I’ve missed you this time around the show can only be so long, right. And I’m out of time. Yeah, that’s right. And yes, that is all you need to know about supply chain tech for this week. Don’t forget to get to supply chain now, radio.com for more of our supply chain now series interviews and events.

Greg White (24:28):

And now get this. We have two live streams per week. The most popular live show in supply chain, supply chain buzz each Monday at noon Eastern time with Scott Luton and me plus our Thursday live stream to be named later when we bring you whatever the hell we want. Like last week when we interviewed our producer clay, the DOE Phillips that’s worth a listen by the way. Thanks for indulging me in this jam session and spending your valuable time with me, letting me get this off my chest and remember acknowledge reality, but never be bound by it.

 

Would you rather watch the show in action?  Watch as Greg introduces you to TECHquila Sunrise through our YouTube channel.

Greg White serves as Principal & Host at Supply Chain Now. Greg is a founder, CEO, board director and advisor in B2B technology with multiple successful exits. He recently joined Trefoil Advisory as a Partner to further their vision of stronger companies by delivering practical solutions to the highest-stakes challenges. Prior to Trefoil, Greg served as CEO at Curo, a field service management solution most notably used by Amazon to direct their fulfillment center deployment workforce. Greg is most known for founding Blue Ridge Solutions and served as President & CEO for the Gartner Magic Quadrant Leader of cloud-native supply chain applications that balance inventory with customer demand. Greg has also held leadership roles with Servigistics, and E3 Corporation, where he pioneered their cloud supply chain offering in 1998. In addition to his work at Supply Chain Now and Trefoil, rapidly-growing companies leverage Greg as an independent board director and advisor for his experience building disruptive B2B technology and supply chain companies widely recognized as industry leaders. He’s an insightful visionary who helps companies rapidly align vision, team, market, messaging, product, and intellectual property to accelerate value creation. Greg guides founders, investors and leadership teams to create breakthroughs that gain market exposure and momentum, and increase company esteem and valuation. Learn more about Trefoil Advisory: www.trefoiladvisory.com

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Greycroft Proves Some VCs Didn’t Slow Down During the Pandemic: tinyurl.com/y23org44
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