Good day,
Julian Counihan, a partner with the early stage investor group Schematic Ventures, said it’s still “early days” as far as evaluating the performance of freight tech startups. “They have built large books of business,” said Counihan, who spoke to FreightWaves about investing in digital brokerage, enterprise and automation business models. “But we’ve yet to see if they’ve really transformed the operational margins of their roles.”
A leveling out in the freight markets may change buyer appetites for technology, Counihan noted. As the power shifts from carriers to shippers, the latter may ramp up investment in tech platforms. At the same time, he explained, “carriers have not sought out technology because they are drowning in revenue. If that changes, you could see shift in [carrier] interest for technology.”
Counihan said he pays close attention to industry trends, such as ELD adoption and how enforcement of hours of service are impacting delivery times. He also stays alert to FedEx and UPS decisions to work with third parties, such as UPS’ partnership with Latch, a smart access system that lets residents and others use smartphones or other digital credentials to unlock doors throughout a building,
Did you know?
About 33 percent of respondents to the 2019 China Business Climate survey report thought the implementation of bilateral tariffs increased the cost of manufacturing their products; 30 percent said the tariffs increased the sale price; 29 percent said the tariffs decreased demand for their products; and 26 percent said they reduced profit slightly.
Source: FreightWaves
Quotable:
“I fell into the mud when the tree fell over the top of me. It happened so fast. It’s like I see an image of a tree. It’s not there. It’s there. You know what I mean.”
-Kear Koch, one of the people rescued in the California mudslides yesterday (FreightWaves)
In other news:
Etsy one-ups Amazon on emissions reductions
Etsy on Wednesday became the first global e-commerce company to offset all of its shipping emissions. The announcement follows the launch of Amazon’s Shipment Zero project, aimed at cutting emissions in half by 2030.(FastCompany)
Pizza chains tap into food delivery market
Papa John’s, Pizza Hut turn to DoorDash and Grubhub for delivery. (Bloomberg)
Best Buy reports better than expected fiscal Q4 sales gain
The electronic retailer’s shares jumped 17 percent on Wednesday, making the company the S&P 500’s biggest gainer. (Forbes)
L.A. County wants Uber and Lyft to pay for congestion
Transportation officials consider taxing Bay Area tech companies for contributing to worsening traffic. (Los Angeles Times)
Final thoughts:
A Morgan Stanley research note highlighted a dizzying array of logistics venture investments and market moves that occurred in February, from Amazon investing in Aurora and Rivian to Volvo delivering EV trucks to customers. Industry adoption is driving the money flow, according to Morgan Stanley analyst Ravi Shanker, who in his concluding statement observes: “Our Take: Trucking / Logistics: Capital raising accelerates as transportation disruption pushes toward commercialization.”
Hammer down everyone!
