Startups in Supply Chain and Logistics

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Business & Economics
Supply Chain and Logistics
<p>STARTUPS IN SUPPLY CHAIN & LOGISTICS
Investments, acquisitions, and trends to watch
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Kerry Wu
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kwu@cbinsights.com
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ABOUT THE PRESENTER
Tech Industry Analyst, CB Insights
Focuses on automotive, transportation, and logistics tech; 
additional topics include on-demand and macro VC trends
Published research and data analysis has been featured in The New 
York Times, Financial Times, The Economist, and Bloomberg, 
among other major media outlets
Previously worked as a management consultant at Simon-Kucher & 
Partners
Graduate of Columbia University
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Investment trends and landscape
Corporate participation
UPS & UPS Strategic Enterprise Fund
Spotlight: Rise of trucking tech
Exits & recent deals.
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TABLE OF CONTENTS
Equity Funding Trends 
GLOBAL INVESTMENTS, DEALS OUTSIDE US
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Supply chain & logistics tech funding:
$8.4 BILLION
across
938 DEALS
since 2012
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FUNDING SKYROCKETS 
TO OVER $4B IN 2016
Investors have steadily 
funneled more capital into 
this space, with annual 
deals and funding rising 
every year since 2012.
We define this category 
as private companies that 
use software to improve 
efficiency across the 
supply chain and logistics 
ecosystems, excluding 
vertical-specific (e.g. 
grocery delivery) on-
demand companies.
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SUPPLY CHAIN & LOGISTICS ANNUAL FINANCING
2012  2016 YTD (10/19/16)
QUARTERLY DEAL HITS 
TRIPLE DIGITS
In Q3'16, deals reached 
100, the highest quarterly 
deal count on record and 
roughly 8x the quarterly 
activity seen in the 
beginning of 2012.
Two of the last three 
quarters have reached 
over $1B in funding, 
fueled by Asian mega-
rounds.
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SUPPLY CHAIN & LOGISTICS QUARTERLY FINANCING
Q1'12  Q3'16
EARLY-STAGE DEAL 
SHARE STRONG
After spiking in 2013, 
early-stage (seed to 
Series A) investments 
have consistently 
accounted for over 60% 
of all deals in the space.
Meanwhile, corporate 
minority stakes and 
convertible notes are 
driving the sizeable share 
of "Other" deals.
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SUPPLY CHAIN & LOGISTICS: DEAL SHARE BY STAGE
2012  2016 YTD (10/19/16)
PE ROUNDS DRIVING 
DOLLAR SHARE
Dollar share has tilted 
towards towards late-
stage rounds (Series D 
and E+).
The Series E+ share in 
particular reflects large 
private equity 
investments, such as the 
Chinese firm Best 
Logistics' $760M round 
in September.
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SUPPLY CHAIN & LOGISTICS: DOLLAR SHARE BY STAGE
2012  2016 YTD (10/19/16)
2015  2016 YTD (10/19/16)
MEGA-ROUNDS PROLIFERATING IN ASIA
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$1.5B
$760M
$550M
$300M
$134M
CHINA
CHINA
INDONESIA
CHINA
INDIA
DIVERSE SOFTWARE & 
HARDWARE STARTUP 
LANDSCAPE
Many well-capitalized 
companies are 
concentrating on e-
commerce logistics 
enablement or on-
demand delivery services.
A host of startups are 
also developing tech-
driven marketplaces for 
international freight 
forwarding as well as 
trucking.
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THE SUPPLY CHAIN & LOGISTICS TECH MARKET MAP
MOST ACTIVE SMART 
MONEY VCS
A variety of top venture 
capital firms have begun 
ramping up their bets in 
SCM and logistics. 
Among the most active 
smart money VCs are 
KPCB and NEA, each 
having invested in a half-
dozen startups or more.
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For our full list of 24 smart money investors, please see this post.
CORPORATE PARTICIPATION
INVESTMENTS, ACTIVE CORPORATES
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CORPORATE FUNDING 
ALSO MARCHES UPWARD
Corporate and CVC 
participation in supply 
chain & logistics funding 
has risen in tandem with 
the sector as a whole.
Chinese logistics 
companies feature heavily 
here as well, with Q3'16 
seeing Fosun and Alibaba 
affiliate Cainiao
participating in a $760M 
round to Best Logistics.
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SUPPLY CHAIN & LOGISTICS CORPORATE ANNUAL FINANCING
2012  2016 YTD (10/19/16)
CORPORATE
SELECT INVESTMENTS
Curbside, Flirtey, Loggi
Deliv, Deposco, Peloton
Flexport, KeepTruckin, Zipline
G7, Huochebang, Renren Kuaidi
Matternet, Zonar
SCM & LOGISTICS: MOST ACTIVE CORPORATE INVESTORS
20122016 YTD (10/21/16)
QUALCOMM, UPS TOP 
MOST ACTIVE CORPS
Startups in this field are 
drawing attention from a 
range of tech venture 
arms and corporations, 
in addition to traditional 
logistics providers and 
auto & truck OEMs.
Last-mile delivery drones 
(e.g. Flirtey, Zipline, and 
Matternet) have been a 
common interest.
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STARTUPS TARGET 
LOGISTICS CORPORATES
Many startups in this 
space are pinpointing a 
range of services 
traditionally associated 
with logistics giants like 
FedEx and UPS.
These companies are 
applying technology, 
mobile platforms, and on-
demand concepts to 
lower costs, increase 
flexibility, and streamline 
operations.
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STARTUPS UNBUNDLING FEDEX & UPS
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UPS deploys capital into tech
As startups rise to complement and potentially challenge services provided by traditional 
logistics companies, UPS seeks to stay competitive by leveraging its Strategic Enterprise 
Fund, ramping up internal capabilities, and collaborating with tech companies.
UPS PARENT & VC ARM 
INVESTING STEADILY
UPS and its Strategic 
Enterprise Fund have 
backed a number of 
supply chain and 
logistics startups in 
drones, on-demand, 
trucking, and more.
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Note: Zipline investment is through the UPS Foundation
UPS: NOTABLE DRONE INVESTMENTS
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Zipline is building drone airplanes designed 
to deliver medical supplies to underserved 
and disaster-stricken areas.
Disclosed funding: $47.2M
Select Investors: Techstars, Felicis Ventures, 
Sequoia Capital, Andreessen Horowitz, 
Visionnaire Ventures, UPS
CyPhy Works is developing drones for aerial 
reconnaissance, search and rescue, delivery 
and more.
Disclosed funding: $36.9M
Select Investors: General Catalyst Partners, In-
Q-Tel, Lux Capital, Bessemer Venture 
Partners, UPS Strategic Enterprise Fund
UPS: NOTABLE ON-DEMAND INVESTMENTS
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Deliv partners with multichannel retailers to 
provide same-day delivery via a fleet of 
crowdsourced drivers. 
Disclosed funding: $40.4M
Select Investors: Upfront Ventures, General 
Catalyst Partners, RPM Ventures, Simon 
Venture Group, UPS Strategic Enterprise Fund
Roadie operates an on-the-way delivery 
network for consumer and business 
shipping.
Disclosed funding: $25M
Select Investors: HAX, TomorrowVentures, H. 
Barton Asset Management, UPS Strategic 
Enterprise Fund
UPS AND CYPHY WORKS TEST DRONE FOR 
URGENT COMMERCIAL DELIVERY
September 23, 2016
UPS TECH INITIATIVES IN THE NEWS
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SPOTLIGHT:
RISE OF TRUCKING TECH
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$7
$9
$51
$219
$331
5
8
15
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2012
2013
2014
2015
2016 YTD
(11/28/2016)
ELECTRIC VEHICLE TECH ANNUAL GLOBAL FINANCING 
HISTORY
2012 - 2016 YTD (11/27/16)
 Disclosed Funding ($M)
 Deals
$363
(Full-Year Projection)
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(Full-Year Projection)
TRUCKING TECH 
FUNDING SKYROCKETS
Since 2012, financing to 
trucking startups has 
risen quickly, with 2016 
on pace to hit fresh highs 
in annual deals and 
dollars.
Recent fundings include 
tracking with FourKites
($13M Series A) and a 
number of platforms and 
marketplaces such as 
Transfix ($22M Series B).
www.cbinsights.com
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TRUCKING TECH ANNUAL FINANCING
2012  2016 YTD (11/28/16)
TECH-DRIVEN BOOKING 
PLATFORMS ON THE 
RISE
Companies such as 
Transfix, uShip and 
Convoy are targeting the 
traditional brokerage 
business with mobile 
platforms, enhanced 
performance measures, 
and algorithmic 
matching.
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Source: WSJ
TELEMATICS SEEING 
EXITS
Telematics startups  
focusing on fleet 
management, safety, and 
efficiency for commercial 
trucking have become 
hot commodities.
Verizon in particular has 
announced a pair of 
major acquisitions in 
2016, acquiring Telogis
and Fleetmatics (IPO'd in 
2012).
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AUTOMATION ALSO 
MAKING STRIDES 
While financing to 
driverless car startups 
has exploded in 2016, 
others seek to apply 
automation in the 
trucking sphere.
Companies are targeting 
trucks' highway-centric 
routes first, with fenced 
automation and 
platooning concepts.
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LUCRATIVE SPACE 
WILL CONTINUE TO 
DRAW ENTRANTS 
Uber quietly launched a 
freight portal in late 
September, signaling a 
push into long-haul 
trucking that could 
combine its efforts in 
automation, mapping, 
and carrier/shipper 
(driver/passenger) 
matching.
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EXITS & ROAD AHEAD
EXIT ACTIVITY, RECENT DEALS, AND NEWS
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EXIT TRENDS ALSO ON 
UPSWING
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45
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3
2
2012
2013
2014
2015
2016 YTD (10/26/16)
SUPPLY CHAIN & LOGISTICS EXITS
2012 - 2016 YTD (10/26/16)
M&A
IPO
SUPPLY CHAIN & LOGISTICS EXIT HISTORY
2012  2016 YTD (10/26/16)
Supply chain & logistics 
exits have mostly 
involved acquisitions 
with a smattering of mid-
size IPOs.
Annual exit totals have 
also steadily risen since 
2012, with 2016 on pace 
to continue this trend at 
the current run rate.
RANK
COMPANY
VALUATION (M)
QUARTER
TYPE
1
$775
Q1'12
Acquistion
(Amazon)
2
$728
Q2'16
IPO
3
$680
Q3'16
Acquistion
(Uber)
4
$675
Q3'15
Acquisition
(Infor)
5
$585
Q4'12
IPO
SUPPLY CHAIN & LOGISTICS: TOP EXITS
20122016 YTD (10/26/16)
TOP EXITS SHOW MIX 
OF M&A AND IPOS
Since 2012, there have 
been a series of $500M+ 
exits in the field, 
including both 
acquisitions and public 
offerings.
The list spans 
companies from 
warehouse automation 
to supply chain 
management platforms.
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DEAL
COMPANY
ROUND / 
AMOUNT
SELECT INVESTORS
DEAL
COMPANY
DISCLOSED 
FUNDING
SELECT INVESTORS
1
Huochebang
Series C 
($20M)
International Finance 
Corporation
6
Sellpy
Seed VC - II 
($1.1M)
H&M CO:LAB
2
Infor
Private 
Equity - III 
($2.5B)
Koch Industries
7
Postmates
Series E 
($141M)
Founders Fund
3
MacroPoint
Growth 
Equity 
($44M)
Susquehanna Growth 
Equity
8
New Dada
Corp. 
Minority 
($50M)
Walmart
4
Zipline 
International
Series B 
($25M)
Andreessen Horowitz, 
Sequoia Capital, 
Subtraction Capital
9
FourKites
Series A 
($13M)
Bain Capital Ventures, 
Hyde Park Angels, 
Hyde Park Partners
5
Rivigo
Series C 
($75M)
Warburg Pincus
10
Clearpath 
Robotics
Series B 
($29.5M)
Caterpillar Ventures, 
GE Ventures, iNovia 
Capital, RRE Ventures
SUPPLY CHAIN & LOGISTICS:
SELECT RECENT EQUITY FINANCINGS
AMAZON'S NEWEST AMBITION: COMPETING 
DIRECTLY WITH UPS AND FEDEX
October 25, 2016
LOOKING AHEAD: TECH & E-COMMERCE CORPORATES ENTERING ARENA
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