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The two forces reshaping the landscape of shipping and logistics

Posted by on Mar 28, 2019 in Column, Convoy, keeptruckin, Logistics, Samsara, Shipping, TC, Transfix, trucking, uber freight | 0 comments

The shipping and logistics space is being rapidly transformed by technology. Innovations in this space span the way buyers and sellers transact (digital freight brokerages), the way goods are monitored during shipment (sensor-enabled real-time monitoring) and the manner in which risk is managed (novel approaches to pricing insurance). With diverse opportunities like these, it is no surprise that this is a space ripe for significant disruption.

And yet technology is not the only force driving change. Regulators are taking a fresh look at the lives of workers in the gig economy, often concluding that many folks classified as independent contractors ought to be treated as employees. As we will see, this is causing a sharp uptick in the creation of small-motor carriers. At the same time, oddly enough, driver scarcity is forcing innovators in the shipping and logistics space to think very hard about how to entice new drivers into the market.

Two forces — driver scarcity and regulation — are working in unison to forge the shipping and logistics space of tomorrow. Before we dive into precisely how this is happening, let me introduce the dramatis personnae in this ecosystem:

  • Shippers — These are the folks who have goods that need to be moved from point A to point B.
  • Carriers — These are the folks who shippers hire to load goods on a truck and move them from point A to point B. I will use carriers and small-motor carriers as interchangeable terms.
  • Brokers — These are the people who connect shippers with carriers, often doing the hard work of making sure that carriers are properly licensed and have the appropriate levels of insurance.
  • FMCSA — Federal Motor Carrier Safety Administration, the body responsible for facilitating safety programs, licensing motor carriers and ensuring compliance with a wide range of shipping and transportation rules and regulations.  

A tale of software and shipping

Today, shipping runs on a backbone of telephone calls, manual logging and delayed payment. Yet the shipping ecosystem of the future will have an entirely different nervous system. Before we examine how driver scarcity and regulation will shape this future system, let’s consider where we are today.

Historically, the shipping industry functions on the basis of trust and deep-rooted professional relationships. The largest shippers have relied for a very long time on an entrenched broker network that connects them with carriers capable of moving cargo reliably at scale. Brokers are paid for reducing risk for the shippers by properly vetting the carriers. These relationships form the nervous system of the traditional trucking industry.

This traditional approach to shipping is being disrupted by a number of well-well-funded, ambitious startups. Companies like Samsara, Convoy, and Freight Rover are introducing next-generation hardware, software tools and other solutions to optimize shipping at scale. These companies have different theses about how to properly optimize shipping tasks, but the common thread is that they all appreciate the need to leverage new technology to remove unnecessary friction between ecosystem actors.

The wake of disruption is going to benefit everyone in the shipping and logistics space.

Carriers will get two important benefits: (1) instant access to shipping jobs and (2) a data platform for managing and understanding their businesses. Shippers will also receive two things essential to optimizing their revenue — (i) a constant supply of reliable carriers and (ii) a wealth of real-time data about live and legacy shipments.

The role of regulation

Against the background of the disruption described above, there has been a lot of regulatory activity affecting the shipping and logistics space. In general, the government is becoming more active in regulating the way in which the shipping industry runs, especially when it comes to the treatment of drivers and the unreasonable demands often imposed on them by aggressive shipping schedules.

The first change came from Congress at the end of 2017 in what is known as the Electronic Logging Device (or ELD) mandate. In a nutshell, the ELD mandate requires carriers to have an approved logging device in their trucks to ensure that their hours of service are properly logged and available for regulator review.

This is surely just the beginning of regulatory activity. Not only has Congress expressed interest in closely monitoring Hours of Service — the amount of consecutive hours a truck driver may lawfully drive — the ELD mandate is widely viewed as a way to better enforce those rules.

Thus, at the federal level, you have a regulator who wants to keep granular tabs on what truck drivers are doing. What about at the state level, what’s going on there?

At the state level, many states are adopting laws that require an employer (including shippers and carriers) to classify someone as an employee if he or she provides services for the employer’s core business. In short, if the employer’s core business is X and a person is hired to do X, then that person is an employee.

In California, for example, this is known as the ABC Test from the Dynamex decision handed down by the California Supreme Court. In that case, Dynamex believed they could lawfully classify their delivery drivers as independent contractors. The benefit of doing so is that independent contractors are not entitled to key employee benefits, including healthcare and expense reimbursements. The California Supreme Court decided that Dynamex made a mistake in not classifying these drivers as employees.

Developments like the ABC Test are already transforming the shipping world. Under this test, a driver is almost always going to be legally entitled to the status of “employee” because a driver in the shipping world is by definition being hired to fulfill the core business activities of the shipper.

So, let’s combine the regulatory developments happening at the state and federal level. At the federal level, Congress is encouraging the rapid adoption of monitoring technologies like ELDs. At the state level, employers are facing pressure to classify drivers as employees. Increased tech-based monitoring is thus occurring at the same time that drivers are getting increased rights to employee benefits at the state level.

This is a big deal. Drivers are getting increased leverage vis-à-vis their employers, while the employers (i.e. shipping companies and carrier owners) are being required to use safety-enhancing monitoring technologies. Regulation is moving in one direction — toward providing a greater degree of protection for truckers.


Source: The Tech Crunch

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Our 9 favorite startups from Y Combinator W19 Demo Day 2

Posted by on Mar 22, 2019 in Apps, Biotech, Food, funding, GreenTech, Hardware, Health, Logistics, Startups, TC | 0 comments

Heathcare kiosks, a home-cooked food marketplace, and a way for startups to earn interest on their funding topped our list of high-potential companies from Y Combinator’s Winter 2019 Demo Day 2. 88 startups launched on stage at the lauded accelerator, though some of the best skipped the stage as they’d already raised tons of money.

Be sure to check out our write-ups of all 85 startups from day 1 plus our top picks, as well as the full set from day 2. But now, after asking investors and conferring with the TechCrunch team, here are our 9 favorites from day 2.

Shef 

Two months ago, California passed the first law in the country legalizing the sale of home cooked food. Shef creates a marketplace where home chefs can find nearby customers. Shef’s meals cost around $6.50 compared to $20 per meal for traditional food delivery, and the startup takes a 22 percent cut of every transaction. It’s been growing 50 percent week over week thanks to deals with large property management companies that offer the marketplace as a perk to their residents. Shef wants to be the Airbnb of home cooked food.

Why we picked Shef: Deregulation creates gold rush opportunities and Shef was quick to seize this one, getting started just days after the law passed. Food delivery is a massive megatrend but high costs make it unaffordable or a luxury for many. If a parent is already cooking meals for their whole family, it takes minimal effort to produce a few extra portions to sell to the neighbors at accessible rates.

Handle

This startup automates the collection process of unpaid construction invoices. Construction companies are often forced to pay for their own jobs when customers are late on payments. According to Handle, there are $104 billion in unpaid construction invoices every year. Handle launched six weeks ago and is currently collecting $22,800 in monthly revenue. The founders previously launched an Andreessen Horowitz-backed company called Tenfold.

Why we picked Handle: Construction might seem like an unsexy vertical, but it’s massive and rife with inefficiencies this startup tackles. Handle helps contractors demand payments, instantly file liens that ensure they’re compensated for work or materials, or exchange unpaid invoices for cash. Even modest fees could add up quickly given how much money moves through the industry. And there are surely secondary business models to explore using all the data Handle collects on the construction market.

Blueberry Medical

This pediatric telemedicine company provides medical care instantly to families. Blueberry provides constant contact, the ability to talk to a pediatrician 24/7 and at-home testing kits for a total of $15 per month. They’ve just completed a paid consumer pilot and say they were able to resolve 84 percent of issues without in-person care. They’ve partnered with insurance providers to reduce ER visits.

Why we picked Blueberry: Questionable emergency room visits are a nightmare for parents, a huge source of unnecessary costs, and a drain on resources for needy patients. Parents already spend so much time and money trying to keep their kids safe that this is a no-brainer subscription. And the urgent and emotional pull of pediatrics is a smart wedge into telemedicine for all demographics.

rct studio

Led by a team of YC alums behind Raven, an AI startup acquired by Baidu in 2017, rct studio is a creative studio for immersive and interactive film. The platform provides a real time “text to render “engine (so the text “A man sits on a sofa” would generate 3D imagery of a man sitting on a sofa) that supports mainstream 3D engines like Unity and Unreal, as well as a creative tool for film professionals to craft immersive and open-ended entertainment experiences called Morpheus Engine.

Why we picked rct studio: Netflix’s Bandersnatch was just the start of mainstream interactive film. With strong technology, an innovative application, and proven talent, rct could become a critical tool for creating this kind of media. And even if the tech falls short of producing polished media, it could be used for storyboards and mockups.

Interprime

Provides “Apple level” treasury services to startups. Startups are raising a lot of money with no way to manage it, says Interprime. They want to help these businesses by managing these big investments by helping them earn interest on their funding while retaining liquidity. They take a .25 percent advisory fee for all the investment they oversee. So far, they have $10 million in investment capital they are servicing.

Why we picked Interprime: The explosion of early stage startup funding evidenced by Y Combinator itself has created new banking opportunities. Silicon Valley Bank is ripe for competition and Interprime’s focus on startups could unlock new financial services. With Interprime’s YC affiliation, it has access to tons of potential customers.

 

Nabis

Nabis is tackling the cannabis shipping and logistics business, working with suppliers to ship out goods to retailers reliably. It’s illegal for FedEx to ship weed so Nabis has swooped in and is helping ship and connect while taking cuts of the proceeds, a price the suppliers are willing to pay due to their 98 percent on-time shipping record.

Why we picked Nabis: Quirky regulation creates efficiency gaps in the marijuana business where incumbents can’t participate since they’re not allowed to handle the flower. As more states legalize and cannabis finds its way into more products, moving goods from farm to processor to retailer could spawn a big market for Nabis with a legal moat. It’s already working with many top marijuana brands, and could sell them additional services around business intelligence and distribution.

WeatherCheck

This startup measures weather damage for insurance companies. WeatherCheck has secured $4.7 million in annual bookings in the five months since it launched to help insurance carriers reduce their overall claims expense. To use the service, insurers upload data about their properties. WeatherCheck then monitors the weather and sends notifications to insurance companies, if, for example, a property has been damaged by hail.

Why we picked WeatherCheck: Extreme weather is only getting worse due to climate change. With 10.7 million US properties impacted by hail damage in 2017, WeatherCheck has found a smart initial market from which to expand. It’s easy to imagine the startup working on flood, earthquake, tornado, and wildfire claims too. Insurance is a fierce market, and old-school providers could get a leg up with WeatherCheck’s tech.

 

Upsolve

Upsolve wants to help low-income individuals file for bankruptcy more easily. The non-profit service gets referral fees from pointing non low-income families to bankruptcy lawyers and is able to offer the service for free. The company says that medical bills, layoffs and predatory loans can leave low-income families in dire situations and that in the last 6 months, their non-profit has alleviated customers from $24 million in debt.

Why we picked Upsolve: Financial hardship is rampant. With the potential for another recession and automation threatening jobs, many families could be at risk for bankruptcy. But the process is so stigmatized that some people avoid it at all costs. Upsolve could democratize access to this financial strategy while inserting itself into a lucrative transaction type.

Pulse Active Stations Network

This startup makes health kiosks for India, meant to be installed in train stations. Co-founder Joginder Tanikella says that there are 600,000 preventable deaths in India as many in the region don’t get regular doctor checkups. “But everyone takes trains,” he says. Their in-station kiosk measures 21 health parameters. The company made $28,000 in revenue last month. Charging $1 per test, Tanikella says each machine pays for itself within 3 months. In the future, the kiosks will allow them to sell insurance and refer users to doctors.

Why we picked Pulse: Telemedicine can’t do everything, but plenty of people around the world can’t make it in to a full-fledged doctor’s office. Pulse creates a mid-point where hardware sensors can measure body fat, blood pressure, pulse, and bone strength to improve accuracy for diagnosing diabetes, osteoarthritis, cardiac problems, and more. Pulse’s companion app could spark additional revenue streams, and there’s clearly a much bigger market for this than just India.

Honorable Mentions

-Allo, a marketplace where parents can exchange babysitting and errand-running

-Shiok, a lab-grown shrimp substitute

-WithFriends, a subscription platform for small retail businesses

More Y Combinator coverage from TechCrunch:

Additional reporting by Kate Clark, Lucas Matney, and Greg Kumparak


Source: The Tech Crunch

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DoorDash claims drivers made an average of at least $17.50/hour on deliveries in 2018

Posted by on Mar 13, 2019 in DoorDash, Food, Logistics, Startups | 0 comments

On-demand food delivery startup DoorDash has been under fire as of late for its practices around paying drivers. In an email to drivers today, obtained by TechCrunch, DoorDash said drivers received an average of $17.50 or more per hour on deliveries in 2018. That figure, of course, does not take into account cost of mileage, payroll taxes for 1099 independent contractors and other expenses.

Sage Wilson, an organizer at nonprofit labor group Working Washington, explained to TechCrunch how that $17.50 per hour figure works out to less than $6 per hour — not including tips, cost of expenses and taxes. That figure, he said, is “based on our review of actual weekly pay data from DoorDash drivers” and an estimate that about 30 percent of the total income comes from tips.

DoorDash currently offsets the amount it pays drivers with customer tips. DoorDash describes its payment structure as follows: $1 plus customer tip plus pay boost, which varies based on the complexity of order, distance to restaurants and other factors. It’s only when a customer doesn’t tip at all, which DoorDash told Fast Company happens about 15 percent of the time, that DoorDash is on the hook to pay the entire guaranteed amount.

In the email sent to drivers today, with “Listening to the Dasher community” in the subject line, DoorDash CEO Tony Xu notes the level of recent discussion pertaining to DoorDash’s pay model. He goes on to defend the company’s practices, saying “we continue to hear from many of you that the model works: you know how much you’ll receive in advance, you receive the guaranteed minimum even if the customer doesn’t tip…”

He does add, however, “But we’ve also heard from some who expressed confusion about how pay is calculated and what happens with tips.”

In the coming weeks, DoorDash said it will launch surveys and organize roundtables for drivers to share their thoughts and concerns. In the email, DoorDash provides a link for drivers to sign up to be included. From there, Xu said DoorDash will look over the feedback, report what it has learned and “what changes we plan to make in response.”

This current model was the result of “months of testing” and surveys of thousands of Dashers. I’ve reached out to DoorDash and will update this story if I hear back.


Source: The Tech Crunch

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Ford partners with geocoding startup what3words

Posted by on Feb 25, 2019 in android, Automotive, Cabify, Ford, Logistics, Lonely Planet, red cross, Software, Spain, Sync 3, TomTom, Transportation, United Nations, what3words | 0 comments

Ford is partnering with what3words to give drivers access to the startup’s novel addressing system.

Under the partnership, drivers will be able to connect to the free what3words app — on an iOS or Android device — to their vehicle via their SYNC 3 infotainment platform. Drivers can find the three-word address on website contact pages, guidebooks and business cards. Drivers can enter the addresses via voice or text input and receive directions through the vehicle’s navigation system.

The startup, founded in 2013, has divided the entire world into 57 trillion 3-by-3 meter squares and assigned three words to each one. Users of the what3words app, which is available in 26 languages, has been adopted by logistics, travel, automotive and humanitarian organizations because it provides exact locations anywhere in the world.

The system is used by Lonely Planet, which has rolled out three-word addresses for each of its listings, as well as Mercedes-Benz, ride-hailing app Cabify, the UN, Red Cross and TomTom.

The startup has also attracted an interesting mix of investors, most recently Sony’s venture capital arm. And last year, Daimler took a 10 percent stake in what3words, following an announcement in 2017 to integrate the addressing system into Mercedes’ new infotainment and navigation system — called the Mercedes-Benz User Experience, or MBUX. MBUX is now in the latest Mercedes A-Class and B-Class cars and Sprinter commercial vehicles.

“We are more mobile than ever before, but with that comes its challenges. The growing traction that what3words is gaining within the automobility industry is a testament to how we are improving journeys and customer experiences,” CEO and co-founder Chris Sheldrick said.

What3words will initially be available to Ford owners in the U.K. and Ireland, Germany, Spain, the U.S. and Mexico. More markets and languages will follow later in the year. The addressing system can be downloaded for free on iOS and Android.


Source: The Tech Crunch

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With a $3.5 million haul, Dray Alliance joins a booming logistics startup scene in LA

Posted by on Feb 25, 2019 in cargo, Craft Ventures, Dray Alliance, Logistics, long beach, Los Angeles, mattel, Recent Funding, Startups, TC, transport, Uber | 0 comments

With an angle on a long-neglected part of the shipping industry — the short-haul movement of cargo from docks to logistics centers — Dray Alliance is joining a growing startup scene for logistics businesses based in Los Angeles.

With some of the nation’s largest ports in Los Angeles and Long Beach, the Southern California region is now fertile ground for businesses hoping to tackle what amounts to a trillion-dollar industry.

Companies like Shippabo, a provider of shipping tracking and logistics for international small cargo transport, and NEXT Trucking, which handles long-haul and short-haul trucking, have both launched in the Los Angeles area to tackle different areas of the shipping industry. And now Dray Alliance is joining them, trying to take a piece of the market transporting cargo from the docks to logistics centers.

The company has raised $3.5 million in seed funding from David Sacks’ Craft Ventures and has already signed contracts with the toy company Mattel and CMA CGM Group.

“Drayage is currently the most neglected area of the transit supply chain. The nuances of drayage create distinct challenges and opportunities that are quite different from other trucking segments such as FTL and LTL,” said Jeff Fluhr, general partner at Craft Ventures, in a statement. “Focus on drayage is what sets Dray Alliance apart. That focus, combined with deep industry expertise, technical skills, and entrepreneurial grit is why we believe this team will emerge as the leader in the sector.”

Founded by middle school friends Steve Wen, Hank Cui and Jason Yu, Dray Alliance leverages years of work that Yu and Wen had done as founders of their own trucking company. Cui was brought on board to start developing the technology product — which Wen says is exactly like an Uber for trucking.

Wen says the company has thousands of truckers who have signed up for the service — most of whom are now on a wait list as the company builds up supply before opening the floodgates on the demand side.

For every successful shipment, Dray Alliance takes 15 percent to 30 percent of the total cost of the shipment, which Wen acknowledged was a bit higher than the industry norm. The reason for that, he said, was because of the massive savings that shippers can realize.

Fines for late pickup on cargo can range from $100 to $1,000 per day. Working with Mattel, for instance, Dray Alliance was able to save the toy manufacturer nearly a quarter of a million dollars through its service.

“The drayage trucking industry still depends on emails and spreadsheets for its daily operations — leading to massive inefficiencies that result in lower earnings for truckers, less predictability in delivery times and 20-50 pefrcent increases in the drayage trucking cost of freight deliveries for shippers. This is not in the best interest of anyone involved,” said Steve Wen, CEO of Dray Alliance. “Dray Alliance wants to bring Uber-like airport pickup efficiency to the drayage industry by providing a seamless mobile experience, more predictability in delivery time and better economics for shippers, carriers and truckers.”


Source: The Tech Crunch

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Logistics startup Flexport just raised a SoftBank-led round at a whopping $3.2 billion valuation

Posted by on Feb 21, 2019 in Flexport, founders fund, Freight Forwarding, Logistics, Recent Funding, Softbank, Startups, TC | 0 comments

Flexport, a 5.5-year-old, San Francisco-based full-service air and ocean freight forwarder, says it has raised $1 billion in fresh funding led by the SoftBank Vision Fund.

Earlier backers of the company, including Founders Fund, DST Global, Cherubic Ventures, Susa Ventures and SF Express, all participated in the round, which reportedly pegs the company’s post-money valuation at $3.2 billion.

According to Forbes, which broke the news, Flexport generated revenue of $471 last year, up from $224.8 million in 2017, thanks in part to some customers who the company says spend more than $10 million a year at Flexport for its help in managing their supply chains.

The company is apparently moving so fast, it hasn’t had a chance to update its marketing materials. CEO Ryan Petersen tells Forbes the company now employs 1,066 people across 11 offices and four warehouses around the world. Its site states it has 600 employees.

Axios reported last week that Flexport was in talks to raise money in a deal led by SoftBank that would value the company in the $3 billion range.

It had previously raised $305 million across five rounds, including, most recently, in April 2018, according to Crunchbase.

Flexport competes with numerous other freight forwarding online marketplaces that are focused on price comparison, as well as helping their clients book and track shipments. But its goal, seemingly, is to compete more directly with heavyweights like DHL, FedEx and UPS. In late 2017, it said it was beginning to charter its own aircraft. Petersen tells Forbes that Flexport now has four warehouses around the world, too.


Source: The Tech Crunch

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Aurora cofounder and CEO Chris Urmson on the company’s new investor, Amazon, and much more

Posted by on Feb 11, 2019 in Amazon, aurora, Automotive, Logistics, Robotics, self-driving, sequoia capital, t.rowe price, TC, Transportation, waymo | 0 comments

You might not think of self-driving technologies and politics having much in common, but at least in one way, they overlap meaningfully: yesterday’s enemy can be tomorrow’s ally.

Such was the message we gleaned Thursday night, at a small industry event in San Francisco, where we had the chance to sit down with Chris Urmson, the cofounder and CEO of Aurora, a company that (among many others) is endeavoring to make self-driving technologies a safer and more widely adopted alternative to human drivers.

It was a big day for Urmson. Earlier the same day, his two-year-old company announced a whopping $530 million in Series B funding, a round that was led by top firm Sequoia Capital and that included “significant investment” from T. Rowe Price and Amazon.

The financing for Aurora — which is building what it calls a “driver” technology that it expects to eventually integrate into cars built by Volkswagen, Hyundai, and China’s Byton, among others —  is highly notable, even in a sea of giant fundings. Not only does it represent Sequoia’s biggest bet yet on any kind of self-driving technology, it’s also an “incredible endorsement” from T. Rowe Price, said Urmson Thursday night, suggesting it demonstrates that the money management giant “thinks long term and strategically [that] we’re the independent option to self-driving cars.”

Even more telling, perhaps, is the participation of Amazon, which is in constant competition to be the world’s most valuable company, and whose involvement could lead to variety of scenarios down the road, from Aurora powering delivery fleets overseen by Amazon, to Amazon acquiring Aurora outright. Amazon has already begun marketing more aggressively to global car companies and Tier 1 suppliers that are focused on building connected products, saying its AWS platform can help them speed their pace of innovation and lower their cost structures. In November, it also debuted a global, autonomous racing league for 1/18th scale, radio-controlled, self-driving four-wheeled race cars that are designed to help developers learn about reinforcement learning, a type of machine learning. Imagine what it could learn from Aurora.

Indeed, at the event, Urmson said that as Aurora had “constructed our funding round, [we were] very much thinking strategically about how to be successful in our mission of building a driver. And one thing that a driver can do is move people, but it can also move goods. And it’s harder to think of a company where moving goods is more important than Amazon.” Added Urmson, “Having the opportunity to have them partner with us in this funding round, and [talk about] what we might build in the future is awesome.” (Aurora’s site also now features language about “transforming the way people and goods move.”)

The interest of Amazon, T. Rowe, Sequoia and Aurora’s other backers isn’t surprising. Urmson was the formal technical lead of Google’s self-driving car program (now Waymo) . One of his cofounders, Drew Bagnell, is a machine learning expert who still teaches at Carnegie Mellon and was formerly the head of Uber’s autonomy and perception team. Aurora’s third cofounder is Sterling Anderson, the former program manager of Tesla’s Autopilot team.

Aurora’s big round seemingly spooked Tesla investors, in fact, with shares in the electric car maker dropping as a media outlets reported on the details. The development seems like just the type of possibility that had Tesla CEO Elon Musk unsettled when Aurora got off the ground a couple of years ago, and Tesla almost immediately filed a lawsuit against it, accusing Urmson and Anderson of trying poach at least a dozen Tesla engineers and accusing Anderson of taking confidential information and destroying the  evidence “in an effort to cover his tracks.”

That suit was dropped two and a half weeks later in a settlement that saw Aurora pay $100,000. Anderson said at the time the amount was meant to cover the cost of an independent auditor to scour Aurora’s systems for confidential Tesla information. Urmson reiterated on Thursday night that it was purely an “economic decision” meant to keep Aurora from getting further embroiled in an expansive spat.

But Urmson, who has previously called the lawsuit “classy,” didn’t take the bait on Thursday when asked about Musk, including whether he has talked in the last two years with Musk (no), and whether Aurora might need Tesla in the future (possibly). Instead of lord Aurora’s momentum over the company, Urmson said that Aurora and Tesla “got off on the wrong foot.” Laughing a bit, he went on to lavish some praise on the self-driving technology that lives inside Tesla cars, adding that “if there’s an opportunity to work them in the future, that’d be great.”

Aurora, which is also competing for now against the likes of Uber, also sees Uber as a potential partner down the line, said Urmson. Asked about the company’s costly self-driving efforts, whose scale has been drastically downsized in the eleven months since one of its vehicles struck and killed a pedestrian in Arizona, Urmson noted simply that Aurora is “in the business of delivering the driver, and Uber needs a lot of drivers, so we think it would be wonder to partner with them, to partner with Lyft, to partner [with companies with similar ambitions] globally. We see those companies as partners in the future.”

He’d added when asked for more specifics that there’s “nothing to talk about right now.”

Before Thursday’s event, Aurora had sent us some more detailed information about the four divisions that currently employ the 200 people that make up the company, a number that will obviously expand with its new round, as will the testing it’s doing, both on California roads and in Pittsburgh, where it also has a sizable presence. We didn’t have a chance to run them during our conversation with Urmson, but we thought they were interesting and that you might think so, too.

Below, for example, is the “hub” of the Aurora Driver. This is the computer system that powers, coordinates and fuses signals from all of the vehicle’s sensors, executes the software and controls the vehicle. Aurora says it’s designing the Aurora Driver to seamlessly integrate with a wide variety of vehicle platforms from different makes, models and classes with the goal of delivering the benefits of its technology broadly.

Below is a visual representation of Aurora’s perception system, which the company says is able to understand complex urban environments where vehicles need to safely navigate amid many moving objects, including bikes, scooters, pedestrians, and cars.

It didn’t imagine it would at the outset, but Aurora is building its own mapping system to ensure what it (naturally) calls the highest level of precision and scalability, so vehicles powered by the company can understand where they are and update the maps as the world changes.

We asked Urmson if, when the tech is finally ready to go into cars, they will white-label the technology or else use Aurora’s brand as a selling point. He said the matter hasn’t been decided yet but seemed to suggest that Aurora is leaning in the latter direction. He also said the technology would be installed on the carmakers’ factory floors (with Aurora’s help).

One of the ways that Aurora says it’s able to efficiently develop a robust “driver” is to build its own simulation system. It uses its simulator to test its software with different scenarios that vehicles encounter on the road, which it says enables repeatable testing that’s impossible to achieve by just driving more miles.

Aurora’s motion planning team works closely with the perception team to create a system that both detects the important objects on and around the road, and tries to accurately predict how they will move in the future. The ability to capture, understand, and predict the motion of other objects is critical if the tech is going to navigate real world scenarios in dense urban environments, and Urmson has said in the past that Aurora has crafted its related workflow in a way that’s superior to competitors that send the technology back and forth.

Specifically, he told The Atlantic last year: “The classic way you engineer a system like this is that you have a team working on perception. They go out and make it as good as they can and they get to a plateau and hand it off to the motion-planning people. And they write the thing that figures out where to stop or how to change a lane and it deals with all the noise that’s in the perception system because it’s not seeing the world perfectly. It has errors. Maybe it thinks it’s moving a little faster or slower than it is. Maybe every once in a while it generates a false positive. The motion-planning system has to respond to that.

“So the motion-planning people are lagging behind the perception people, but they get it all dialed in and it’s working well enough—as well as it can with that level of perception—and then the perception people say, ‘Oh, but we’ve got a new push [of code].’ Then the motion-planning people are behind the eight ball again, and their system is breaking when it shouldn’t.”

We also asked Urmson about Google, whose self-driving unit was renamed Waymo as it spun out from the Alphabet umbrella as its own company. He was highly diplomatic, saying only good things about the company and, when asked if they’d ever challenged him on anything since leaving, answering that they had not.

Still, he told as one of the biggest advantage that Aurora enjoys is that it was able to use the learnings of its three founders and to start from scratch, whereas the big companies from which each has come cannot completely start over.

As he told TechCrunch in a separate interview last year when asked how Aurora tests its technology, then it comes to self-driving tech, size matters less than one might imagine. “There’s this really easy metric that everyone is using, which is number of miles driven, and it’s one of those things that was really convenient for me in my old place [Google] because we’re out there and we were doing a hell of a lot more than anybody else was at the time, and so it was an easy number to talk about. What’s lost in that, though, is it’s not really the volume of the miles that you drive.” It’s about the quality of the data, he’d continued, suggesting that, for now, at least, Aurora’s is hard to beat.


Source: The Tech Crunch

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The next big bet for former Uber CEO Travis Kalanick may be cloud kitchens — in China

Posted by on Feb 1, 2019 in City Storage Systems, CloudKitchens, Food, Logistics, ofo, Real Estate, Startups, TC, Travis Kalanick | 0 comments

Former Uber CEO Travis Kalanick may have been nudged out of one of the world’s most highly valuable private companies by investors frustrated over its troubled culture, but his moves remain of great interest given how far he’d driven the rideshare giant.

One such move, according to a new report in the South China Morning Post, looks to be to help foster the growing concept of cloud kitchens to China.

We’ve reached out to Kalanick for more information, but per the SCMP’s report, Kalanick is partnering with the former COO of the bike-sharing startup Ofo, Yanqi Zhang. Their apparent project involves Kalanick’s L.A.-based company, CloudKitchens, which enables restaurants to set up kitchens for the purposes of catering exclusively to customers ordering in, as that’s how many people are consuming restaurant food in increasing numbers. (More on the movement here.) The kitchens are established in underutilized real estate that Kalanick is snapping up through a holding company called City Storage Systems.

According to The Spoon, a food industry blog, the trend is beginning to gain momentum in particular regions, including India, where it says many restaurants struggle to afford the traditional restaurant model, which often involves paying top dollar for rent, as well covering wages for employees, from dishwashers to cooks to servers. Using so-called cloud kitchens enables these restaurateurs to share facilities with others, and to do away with much of their other overhead.

Some are even being promised more affordable equipment. For example, according to The Spoon, the restaurant review site Zomato, through its now two-year-old service called Zomato Infrastructure Services, aims to create kitchen “pods” that restaurants can rent, and it’s using data to identify recently closed restaurants that may be looking to offload their kitchen equipment for whatever they can get for it.

Shared kitchens have also been taking off in China, as notes the SCMP, which cites Beijing-based Panda Selected and Shanghai-based Jike Alliance as just two companies that Kalanick would be bumping up against.

Kalanick wasn’t the first here in the U.S. to spy the trend bubbling up, but he seems to be taking it as seriously as any entrepreneur. Last year, he spent $150 million to buy a controlling stake in City Storage Systems, the holding company of CloudKitchens, through a fund that he established around the same time, called the 10100 fund. The money was used to buy out most of the company’s earlier backers, including venture capitalist Chamath Palihapitiya, according to a report last year by Recode.

That same report said that Kalanick now has a controlling interest in City Storage Systems. It also said that serial entrepreneur Sky Dayton — who previously founded EarthLink, co-founded eCompanies and founded Boingo — is a co-founder.

City Storage Systems isn’t interested in on-demand kitchens alone, reportedly. The idea behind it is to buy distressed real estate, including parking lots, and repurpose it for a number of online-focused ventures.

While the China twist looks like a new development, it wouldn’t be a wholly surprising move. Having had to back out of China with Uber in 2016, Kalanick may be of a mind to jump into the country faster this time around, and with a local partner with whom he has a relationship. Indeed, Zhang spent two years as a regional manager for Uber in China before co-founding Ofo, which has since run into problems of its own.

We’ve also reached to Zhang for this story and hope to update it when we learn more.


Source: The Tech Crunch

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Why you need a supercomputer to build a house

Posted by on Dec 8, 2018 in affordable housing, Artificial Intelligence, building, building codes, buildings, camino, concur, concur labs, Cove.Tool, cover, Cover Technologies, Developer, Enterprise, envelope, Government, GreenTech, housing, Logistics, machine learning, Policy, Real Estate, regulation, SaaS, Startups, TC, zoning | 0 comments

When the hell did building a house become so complicated?

Don’t let the folks on HGTV fool you. The process of building a home nowadays is incredibly painful. Just applying for the necessary permits can be a soul-crushing undertaking that’ll have you running around the city, filling out useless forms, and waiting in motionless lines under fluorescent lights at City Hall wondering whether you should have just moved back in with your parents.

Consider this an ongoing discussion about Urban Tech, its intersection with regulation, issues of public service, and other complexities that people have full PHDs on. I’m just a bitter, born-and-bred New Yorker trying to figure out why I’ve been stuck in between subway stops for the last 15 minutes, so please reach out with your take on any of these thoughts: @Arman.Tabatabai@techcrunch.com.

And to actually get approval for those permits, your future home will have to satisfy a set of conditions that is a factorial of complex and conflicting federal, state and city building codes, separate sets of fire and energy requirements, and quasi-legal construction standards set by various independent agencies.

It wasn’t always this hard – remember when you’d hear people say “my grandparents built this house with their bare hands?” These proliferating rules have been among the main causes of the rapidly rising cost of housing in America and other developed nations. The good news is that a new generation of startups is identifying and simplifying these thickets of rules, and the future of housing may be determined as much by machine learning as woodworking.

When directions become deterrents

Photo by Bill Oxford via Getty Images

Cities once solely created the building codes that dictate the requirements for almost every aspect of a building’s design, and they structured those guidelines based on local terrain, climates and risks. Over time, townships, states, federally-recognized organizations and independent groups that sprouted from the insurance industry further created their own “model” building codes.

The complexity starts here. The federal codes and independent agency standards are optional for states, who have their own codes which are optional for cities, who have their own codes that are often inconsistent with the state’s and are optional for individual townships. Thus, local building codes are these ever-changing and constantly-swelling mutant books made up of whichever aspects of these different codes local governments choose to mix together. For instance, New York City’s building code is made up of five sections, 76 chapters and 35 appendices, alongside a separate set of 67 updates (The 2014 edition is available as a book for $155, and it makes a great gift for someone you never want to talk to again).

In short: what a shit show.

Because of the hyper-localized and overlapping nature of building codes, a home in one location can be subject to a completely different set of requirements than one elsewhere. So it’s really freaking difficult to even understand what you’re allowed to build, the conditions you need to satisfy, and how to best meet those conditions.

There are certain levels of complexity in housing codes that are hard to avoid. The structural integrity of a home is dependent on everything from walls to erosion and wind-flow. There are countless types of material and technology used in buildings, all of which are constantly evolving.

Thus, each thousand-page codebook from the various federal, state, city, township and independent agencies – all dictating interconnecting, location and structure-dependent needs – lead to an incredibly expansive decision tree that requires an endless set of simulations to fully understand all the options you have to reach compliance, and their respective cost-effectiveness and efficiency.

So homebuilders are often forced to turn to costly consultants or settle on designs that satisfy code but aren’t cost-efficient. And if construction issues cause you to fall short of the outcomes you expected, you could face hefty fines, delays or gigantic cost overruns from redesigns and rebuilds. All these costs flow through the lifecycle of a building, ultimately impacting affordability and access for homeowners and renters.

Startups are helping people crack the code

Photo by Caiaimage/Rafal Rodzoch via Getty Images

Strap on your hard hat – there may be hope for your dream home after all.

The friction, inefficiencies, and pure agony caused by our increasingly convoluted building codes have given rise to a growing set of companies that are helping people make sense of the home-building process by incorporating regulations directly into their software.

Using machine learning, their platforms run advanced scenario-analysis around interweaving building codes and inter-dependent structural variables, allowing users to create compliant designs and regulatory-informed decisions without having to ever encounter the regulations themselves.

For example, the prefab housing startup Cover is helping people figure out what kind of backyard homes they can design and build on their properties based on local zoning and permitting regulations.

Some startups are trying to provide similar services to developers of larger scale buildings as well. Just this past week, I covered the seed round for a startup called Cove.Tool, which analyzes local building energy codes – based on location and project-level characteristics specified by the developer – and spits out the most cost-effective and energy-efficient resource mix that can be built to hit local energy requirements.

And startups aren’t just simplifying the regulatory pains of the housing process through building codes. Envelope is helping developers make sense of our equally tortuous zoning codes, while Cover and companies like Camino are helping steer home and business-owners through arduous and analog permitting processes.

Look, I’m not saying codes are bad. In fact, I think building codes are good and necessary – no one wants to live in a home that might cave in on itself the next time it snows. But I still can’t help but ask myself why the hell does it take AI to figure out how to build a house? Why do we have building codes that take a supercomputer to figure out?

Ultimately, it would probably help to have more standardized building codes that we actually clean-up from time-to-time. More regional standardization would greatly reduce the number of conditional branches that exist. And if there was one set of accepted overarching codes that could still set precise requirements for all components of a building, there would still only be one path of regulations to follow, greatly reducing the knowledge and analysis necessary to efficiently build a home.

But housing’s inherent ties to geography make standardization unlikely. Each region has different land conditions, climates, priorities and political motivations that cause governments to want their own set of rules.

Instead, governments seem to be fine with sidestepping the issues caused by hyper-regional building codes and leaving it up to startups to help people wade through the ridiculousness that paves the home-building process, in the same way Concur aids employee with infuriating corporate expensing policies.

For now, we can count on startups that are unlocking value and making housing more accessible, simpler and cheaper just by making the rules easier to understand. And maybe one day my grandkids can tell their friends how their grandpa built his house with his own supercomputer.

And lastly, some reading while in transit:


Source: The Tech Crunch

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BlueCargo optimizes stacks of containers for maximum efficiency

Posted by on Nov 23, 2018 in BlueCargo, container, Enterprise, Europe, Logistics, Startups | 0 comments

Meet BlueCargo, a logistics startup focused on seaport terminals. The company was part of Y Combinator’s latest batch and recently raised a $3 million funding round from 1984 Ventures, Green Bay Ventures, Sound Ventures, Kima Ventures and others.

If you picture a terminal, chances are you see huge piles of containers. But current sorting methods are not efficient at all. Yard cranes end up moving a ton of containers just to reach a container sitting at the bottom of the pile.

BlueCargo wants to optimize those movements by helping you store containers at the right spot. The first container that is going to leave the terminal is going to be at the top of the pile.

“Terminals spend a lot of time making unproductive or undesired movements,” co-founder and CEO Alexandra Griffon told me. “And yet, terminals only generate revenue every time they unload or load a container.”

Right now, ERP-like solutions only manage containers according to a handful of business rules that don’t take into account the timeline of a container. Empty containers are all stored in one area, containers with dangerous goods are in another area, etc.

The startup leverages as much data as possible on each container — where it’s coming from, the type of container, if it’s full or empty, the cargo ship that carried it, the time of the year and more.

Every time BlueCargo works with a new terminal, the startup collects past data and processes it to create a model. The team can then predict how BlueCargo can optimize the terminal.

“At Saint-Nazaire, we could save 22 percent on container shifting,” Griffon told me.

The company will test its solution in Saint-Nazaire in December. It integrates directly with existing ERP solutions. Cranes already scan container identification numbers. BlueCargo could then instantly push relevant information to crane operators so that they know where to put down a container.

Saint-Nazaire is a relatively small port compared to the biggest European ports. But the company is already talking with terminals in Long Beach, one of the largest container ports in the U.S.

BlueCargo also knows that it needs to tread carefully — many companies already promised magical IT solutions in the past. But it hasn’t changed much in seaports.

That’s why the startup wants to be as seamless as possible. It only charges fees based on shifting savings — 30 percent of what it would have cost you with the old model. And it doesn’t want to alter workflows for people working at terminals — it’s like an invisible crane that helps you work faster.

There are six dominant players managing terminals around the world. If BlueCargo can convince those companies to work with the startup, it would represent a good business opportunity.


Source: The Tech Crunch

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