January 2022

Smartlane secures 6-million-euro funding to push their transport intelligence software

Smartlane, an F-LOG Ventures’ portfolio company since early 2021, has secured blueworld.group as a new investor on their way to developing the number one transport intelligence software. Additionally, they secured grants from the European Innovation Council. Their transport optimization and analytics engine with fully-automated transport planning and industry-specific process mining capabilities improves logistics companies' efficiency, reliability, and transparency.

The Smartlane founders Mathias Baur, Monja Mühling and Florian Schimandl

Munich, 11 January 2022 - Our portfolio company Smartlane recently secured 6 million euros in funding. Following an intense competition, they won a total of 1.7 million euros in support funds from the European Innovation Council (EIC). In addition, they successfully closed a Series A financing of more than 4.5 million euros, backed by F-LOG Ventures and other investors like Freigeist and the new investor JOVA Direkt Invest GmbH, an investment vehicle of the blueworld.group.

Smartlane offers an AI-based SaaS solution that optimizes and automates the dispatching and transportation planning for road haulage. Their software analyzes over 250 planning parameters, thereby saving up to 90% of the time spent on dispatching which at the same time reduces the CO2 footprint of freight forwarders and logistics companies. Since 2015, the team has achieved outstanding progress both in terms of product maturity and business development. In addition to refining their AI, they have achieved €360,000 in savings per customer location per year.

Smartlane’s solution is in response to the rapidly changing transportation market. The general cargo market, which is currently Smartlane’s focus segment, is growing exponentially, not least due to a rise in order volumes during the pandemic - a situation that has become even more critical due to a shortage of drivers and dispatchers. Also, the growing awareness of green, sustainable logistics shows once again that a cloud-based AI solution that aims to optimize logistical operations is essential to saving resources and ensuring operational excellence.

We therefore welcome the new investor to the club of motivated investors ready to support Smartlane on its way to the number one transport intelligence software. The investment will enable Smartlane to significantly grow its team and write the next chapters of its success story.

November 2021

F-LOG´s Industry Perspective #3: City logistics and why it will remain a hot topic

For many e-commerce firms it has always been essential to be close to big cities and metropolitan areas. With the goal of wanting to improve logistics within the city, more startups and investors are expected to reallocate capital to urban logistics and decentralized fulfillment solutions.

But is city logistics really that special? Yes, it is!

Why? Last mile delivery, especially within inner cities, is the most inefficient step of the entire supply chain, 61% of surveyed logistics companies say. This is also because it is the most expensive part of the supply chain, taking up a 53% share in the shipping costs. So, let’s talk city logistics.

By definition, city logistics refers to the distribution of freight in urban areas. With demand growing for both a service economy and life in urban areas, cities are challenged to provide more frequent and customized deliveries. More specifically, urban goods movements utilize around 20% to 30% of kilometers driven in the metropolitan area.

City logistics is a playing field that differs strongly from other areas — especially when it comes to logistics. Looking at supply chains, logistics mostly takes place in surroundings that are specifically created for the handling, storage, and transportation of goods. These surroundings are designed by logistics experts. As soon as logistics enters the city, this is no longer the case. In fact, logistical requirements are often neglected in urban planning.

And why is it such a complex concept?
  • Software requirements: The city is the place where outdated B2B logistics software will meet the highest UX-related expectations of consumers. Studies show that 56% of consumers would not buy a brand again if they were not satisfied with the shipping service. This state-of-the-art customer experience can only be achieved when the software used by last mile logistics providers and retailers allows a smooth and steady communication with the recipient. As the systems used to date are technologically outdated in most cases, the key enabler of such experiences is missing.
  • Process flexibility: Additionally, it is important to remember that the consumers developed more personalized and flexible service requirements throughout the last years. The delivery should be as convenient as possible, such as, for example, having the possibility to choose a specific time window for delivery of the order even though the parcel is already on its way. This complicates the processes for the company while the technology behind such processes becomes even more relevant.
  • The number of powerful stakeholders: Inner-city logistics constraints are being defined at all levels. Not only by the European Commission, whose low emission zone policy is becoming more and more stringent, but also the cities themselves restrict the access of transport vehicles.
  • The high density and diversity of competitors: Borders between CEP giants, food delivery services and innovative last-mile service providers are increasingly blurred (as can be seen when looking at Delivery Hero’s Germany come-back in the quick commerce market) as core competencies widely overlap.
  • Hardware-related requirements: Scooters would struggle to deliver furniture, but neither are more trucks a solution either. Last-mile robots and drones are not only facing physical challenges posed by curbsides, lampposts, and cables, but also legal frameworks. For this reason, the most practical application of UAVs and other robots is still in the pilot phase.
Major VC investments in city logistics

A small tour of the more recent venture capital (VC) history in city logistics shows us that a lot has happened. Makers of semi and fully autonomous last-mile vehicles (e.g., Starship, Nuro) from all over the world receive billions in funding every year. Restaurant delivery startups like Takeaway became grown-ups a decade ago already. Those who deliver food and consumables instantly from their own micro warehouses — known as flash supermarkets — are the latest VC hype with hundreds of millions in VC funding for Gorillas, Flink, and others in only a few months. Both Gorillas and Flink were founded in Berlin at the end of 2020 and since have raised US$1.3 billion and US$304.2 million in total respectively. And even if we look at mobility as logistics’ partner in crime, micro mobility such as ride hailing, scooter and unmanned aerial vehicle (UAV) startups, e.g. drones, have been VC targets for a long time.

Despite all this funding, we are convinced that in Europe, city logistics has yet to live up to its full potential!

… and why it will remain a hot topic

From our point of view, some “white spots” in the urban area that are ready to be revolutionized include:

  • Delivery service orchestrators: Who will find the solution that succeeds in reducing the number of vehicles of different service providers that cover the same routes every day? Pilots such as the Berlin KoMoDo project, in which Germany’s key CEP service providers (DHL, DPD, GLS, Hermes and UPS) collaborate by sharing city hubs, show the great potential of a joint effort. However, the digital concept breaking the established industry logic is still missing.
  • Micro hub network operators: Who will succeed in decentralizing fulfillment infrastructures in a way that brings the new standard of instant and highly flexible delivery to product groups other than food? Initial investments by VCs indicate the new wave. However, the winning business model is yet to be found. Will it be the B2B service provider with innovative last-mile infrastructures and services — the “Gorillas for non-food retailers” — building a proprietary B2C marketplace brand? Or someone else?
  • Retail connectors: Who will convincingly connect local retailers with the last mile for them to run a true omnichannel business? Are ship-from-store startups scalable? And do they offer potentially strong margins?
  • Returns champions: Who will design the desperately awaited solution that takes the pain out of collecting, processing, and redistributing e-commerce returns in an environmentally friendly, convenient, and efficient way? Can business models that became huge in the U.S. succeed in Europe too?
  • Crowd enablers: There should be ways to involve the crowd in last mile logistics. What is common across all Asian and South American regions has yet to take off in many European countries.

When talking about new LogTech business models, cities are the melting pot for cutting-edge technology-, hardware-, and consumer-driven requirements in logistics. These requirements are key to innovative concepts coming up in the future. VCs should be prepared and keep an eye on city logistics.

September 2021

F-LOG´s Industry Perspective #2: Supply chain resilience on the urge

According to a McKinsey Research Paper, 93% of global supply chain leaders are planning to increase resilience along the supply chain. Accelerated by the current pandemic, it is a trend no manager should be missing out on, regardless of size, location, or industry of their company. That’s why we, too, took a closer look at the biggest drivers, problems, opportunities, and startups in this field.

One key tool to increase resilience is visibility within the supply chain: It refers to the exchange and availability of information and data within and between companies as well as between companies and stakeholders. A significant aspect of this approach involves tracking and tracing of the supply chain and the decision who to share this information with. Thereby, managers can identify critical paths in the supply chain and work on solutions or financial and operational buffers. Other advantages include enhanced availability, flexibility, and more control of the supply chain as well as strengthened risk management and improved transparency. Properly applied, supply chain visibility leads to supply chain resilience which can result in a competitive advantage.

Covid-19 key driver for increased awareness of this topic

Huge bottlenecks and chaotic developments in nearly every supply chain worldwide because of COVID-related shortages and/or outages shed a light on the importance of keeping track of the product journey from the very start to end-use. But there are also other interesting aspects supporting this trend:

  • The number of companies using assistance in supply chain mapping doubled from 22.5% in 2019 to 40.6% in 2021. More than half of the organizations (57.6%) reported that COVID-19 was the reason for investing in supply chain visibility solutions.
  • Supply chain disruptions like the pandemic, natural disasters, or cyber-attacks are very costly. McKinsey calculates that companies can lose 42% of a year’s EBITDA over a period of ten years.
  • If we take a closer look, the percentage of organizations experiencing 10 or more disruptions in supply chain transactions has risen from 4.8% in 2019 to 27.8% in 2020, which reflects an increase by over 20%.
  • Trends such as customer awareness and aspects of sustainability are also main drivers of supply chain visibility.
  • But also, RFID, cellular devices, and services, as well as sensors, are becoming more ubiquitous. According to The Business Continuity Institute, about 55.6% of organizations are already using technology to assist them with analyzing and reporting supply chain disruptions.

All these aspects taken together demonstrate the increased awareness and urgency to bring more visibility into the supply chain.

Startups are challenging the status quo

The startup sphere applies different approaches and technologies to achieve visibility. From what we have noticed, they specifically use IoT sensors, blockchain and RFID technology for certain use cases. IoT sensors´ prices went from $1.30 in 2004 down to $0.44 in 2018, which makes them an interesting potential investment. But especially supply chain visibility platforms with a more general approach like Project44, FourKites, e2Log and Shippeo recently raised stunning funding rounds.

  • Project44 raised nearly $400m with the biggest investor being Goldman Sachs and Emergence. The scale-up offers a visibility platform for shippers and third-party logistics firms. They connect, automate, and provide visibility into key transportation processes to accelerate insights and shorten the time it takes to turn those insights into actions.
  • FourKites secured funding of more than $200m with Bain Capital Ventures and Qualcomm Ventures as the most recent investors. FourKites is a supply chain visibility platform designed for transportation into yards, warehouses, and stores.
  • Shippeo reached nearly $70m in capital with Nordic Ventures as one of the funders. Shippeo is a supply chain visibility platform that provides shippers instant access to predictive information of all deliveries.

These examples underline the relevance of venture capital for this industry to grow further, but also the importance of this topic in general.

There are many challenges along the way to real resilience

Although supply chain visibility seems to be the focus of many, there are still quite a few major and minor challenges to be addressed. Especially the absence of technological readiness of many infrastructures and incomplete or low-quality data fail to support, or rather complicate this development.

Also, supply chain operations still lack adequate planning while the different connections are missing cohesion. Information in most organizations tends to be confined to the respective departments. The sales department has its own projections and budget, production has its own schedules, and buyers have supplier costs and delivery schedule data. This data fragmentation serves the purpose of the individual departments within an organization rather than the bigger picture — in this case: the entire supply chain. Additionally, each supplier and customer have their own information which they usually do not share with other supply chain partners at all. Everyone lives in their own bubble with their very own information with just little or no interconnection with the other partners.

Looking at this trend, interconnectedness is key and thus must be the goal. Since costs related to the supply chain are believed to account for 30% — 80% of sales, amalgamating the data of all departments is crucial for success.

What can we take from this?

Although total supply chain visibility exists in theory, in practice, companies must use the right visibility application to find the right level of transparency for the right use case in order to receive a real value from it.

Departments need to collaborate rather than go it alone, to create proper and useful supply chain visibility. However, the biggest challenge remains that most of the existing data is tracked elsewhere. If data were gathered and patterns identified, the supply chain could be better understood, leading to adequate visibility and understanding of the whole process.

The topic is very interesting for venture capitalists since there is a large number of startups trying to get a foothold into the supply chain visibility market. Compared to the situation a few years ago when software for this endeavor was not mature enough, startups nowadays have figured out how to manage and use it properly. And since everybody experienced the shortages of supply chains firsthand during the COVID-19 pandemic, many entrepreneurs are setting up a supply chain visibility startup — sometimes to great success, like Project44.

The industry is fully aware of the importance of supply chain resilience, and investors and decision-makers are hence ready to invest in proper solutions.F-LOG VENTURES

News and updates related to F-LOG Ventures, LogTech and Venture Capital.

August 2021

Meet the Team #2 — Tim, Managing Partner

As already communicated, we would like to show you who´s behind F-LOG. To give you a better idea of the team we prepared some questions for each of them. Let us introduce to you: Tim!

Tim holds a Master of Science from the Mercator School of Management. While studying, he founded a food business which he sold in 2015. Following his exit, his focus moved to the world of venture capital, which led him to the VC branch of NRW.BANK, where he managed investments into digitalisation and technology before joining F-Log Ventures.
Tell us about your professional journey so far.

During my business administration studies, I founded a company in the food sector with a friend. We were able to quickly achieve initial success and grow. After the exit and graduation, I switched to the investor side, which always interested me a lot during my startup days. I have now been working in venture capital since 2014 and still passionately look for outstanding tech entrepreneurs.

What excites you about working in venture capital?

Without sounding pathetic, I have always found it interesting that venture capital is somewhat futurological. In our line of work, we try to find companies that come up with highly innovative products but have not yet acquired a relevant market share. So we try to gage if their product developments will be used by big companies or end customers in the next years which are not aware of their existence at that time. The fact that the people behind the companies often have an incredible amount of fire in them and regularly inspire me again is like the cherry on the cake.

What do you look at when investing in startups?

We try to obtain as much information as possible for our analyses. Special focal topics include, for example, team, market, growth, and exit potential. But I am convinced that you need a certain spirit in the team to be able to work together for many hours (with many ups and downs) toward the success of a young company. When you visit a company in the capacity of the potential investor, you are always in an exceptional situation. The team is prepared and wants to present itself from its best side. That’s why I try to pay special attention to certain subtleties, which can sometimes seem very mundane. For example, how respectfully the founders and team members treat each other. It is also quite revealing if people hold the door open for each other, or whether colleagues are poured a glass of water at lunch.

Why did you join F-LOG Ventures?

I believe that the European venture capital market still has some catching up to do in terms of supporting its portfolio. We want to set a new benchmark with F-LOG in the logistics sector and become the relevant LOG-Tech investor through our industry-specific know-how and understanding of the industry, but above all our network.

In your opinion, what is the hottest topic in logistics at the moment?

This is actually not an easy question, as there is an incredible amount happening in logistics right now. But we are currently looking with great interest into companies that are dealing with sustainability. You can literally see how the topic is growing as a focal point with end customers (and thus also with companies that supply these customers). Political pressure will also grow in the coming years. Companies that fail to pay attention to this will really feel the heat. I think there are quite a lot of low hanging fruits here, especially in logistics, which have extremely large market potential.

Are there any learnings from your professional life which you value in your private life, too?

Don’t time the market!

There is a time for everything and sometimes there is no point in rushing things. No matter how much you would like to make these things happen.

Are there any tips you would like to share with entrepreneurs looking for funding?

Do not take the search for capital lightly. Prepare for meetings with potential investors as best as you can, have your documents on point, and be ready to give a plausible answer to any question (especially the hard ones). Nothing is more off-putting than an unprofessional founding team. Remember: You never get a second chance to make a good first impression!

July 2021

F-LOG´s Industry Perspective #1: How warehouses become smart

This is the first article of our new blog series, F-LOG´s Industry Perspectives, which we want to use to irregularly share our view and industry insights on some of the hottest topics in the LogTech space. We start with an overview of the current situation of robotics in intralogistics.

Again and again, we have encountered business models and technologies around the topic of smart warehousing and robotics in intralogistics in the past months. We took this as an occasion to dig a little deeper into intralogistics use-cases for robotics and how they drive the trend of smart warehousing.

Macro-level trends as a key driver for more automation

Demand for more automation in intralogistics is rising because the ever-growing e-commerce sector is transforming order structures and buying habits of consumers. Consumer expectations are shifting towards faster and cheaper delivery services, reinforced by Amazon’s business model of these past years.

Another important factor is the human resources problem — rising costs and a shortage of workers support the need for more automation. Especially after Covid-19, investments in robotics and automation are economically more attractive since a larger share of value creation will again take place directly in industrialized countries, where labour costs are already at a very high level.

Overall, logistics service providers have to take advantage of using robots in their warehouses to tackle these challenges, reduce operational costs and increase productivity.

Massive growth ambitions of the robotics market

The trend for more automation is also reflected in the market numbers and forecast for the next years. The robotics market is expected to grow from USD 76.6 billion in 2020 to USD 176.8 billion by 2025; that corresponds to a CAGR of 18.2%. Especially collaborative robots are expected to grow at the highest CAGR during the forecast period. Therefore, this blog article will have a closer look at the technology that takes on dangerous, repetitive and difficult jobs and which enables humans to perform their jobs with more creativity and flexibility, leading to more efficiency and productivity in the warehouse.

Three key technologies and relevant startups that enable smarter warehouses today

There are various types of robots that are used for intralogistics solutions to handle tasks such as picking and delivery, stock movement and material handling or quality inspections. In the following we will focus on three key technologies such as Autonomous Mobile Robots (AMRs), Articulated Robot Arms (ARAs), Unmanned Aerial Vehicles (UAVs) and their practical impact on daily operations today.

1. Autonomous Mobile Robots (AMR)

AMRs are used especially for materials handling and evolved from Automated Guided Vehicles (AGV). While conventional AGVs can only follow fixed paths and move to predefined points on the guided path, the vision-based system of AMRs uses touch-based sensors, onboard computers, and AI to move in dynamic warehouse environments to any accessible location. Yet, AMRs not only present a great chance to improve intralogistics processes but also a huge market opportunity. The AMR market comes with double-digit growth and more than USD 10 billion in revenue in 2023.

One practical example of AMRs that work collaboratively alongside warehouse associates is Locus Robotics, a robotic unicorn funded with over USD 250 million. Locus offers a Robots as a Service (RaaS) subscription-based program that makes it easy to add AMRs to warehouse operations and shift capital expenses for automation to operational or labour expenses.

Its AMRs act as picking assistants but contrary to other systems, the warehouse associate does not follow the robot after the pick — instead, he is directed to the closest robot nearby for more work while the initial robot moves on to the next task, often with a different associate. This process enables shorter cycle times, 2–3 times greater productivity and a 129% greater ROI.

Other well-funded AMR startups are 6 River Systems, founded in 2015 and acquired by Shopify in 2019 for USD 450 million, InVia Robotics (USD 29 million funding) or Magazino (USD 50 million funding), to name a few.

2. Articulated Robotic Arms (ARA)

ARAs have flexible joints and articulated robotic arms to move and lift items in the warehouse. They’re typically used for picking and placing packages onto racks, palletizing, loading and unloading inventory as well as sorting packages. The challenges that make these tasks extremely complex are the diversity in packaging materials, the identification of single items within a box, and the different shapes of each product or package. That’s why ARA startups are creating robots that come very close to human capabilities, both in terms of hardware and software. Most labour (up to 80%) in a warehouse is dedicated to picking and packing, and ARAs have become very efficient in performing these tasks. Today, most ARAs are used in manufacturing since the tasks are more standardized and not as complex as in intralogistics. To deliver the results described above, ARAs rely on enabling technology, which is why the right software for these robotic arms is as important as the hardware itself.

A good example of this use case is Osaro, a San Francisco-based artificial intelligence startup, funded with more than USD 60 million whose software powers practical robotics automation solutions using technology such as advanced machine learning for visual perception and easy to integrate APIs. It enables the robotic arms to adapt automatically to moderate task variations, to detect all types of objects and to deploy easily and fast. The result is a scalable solution that works accurately (successful grip rate >99.5%) with cycle times as low as 3.5 seconds, delivering higher productivity and improved supply chain resilience. Another startup that provides an ARA end-to-end solution including software and hardware for e-commerce order fulfilment is RightHand Robotics, based in the US and funded with more than USD 30 million.

3. Unmanned Aerial Vehicles (UAV)

Unmanned Aerial Vehicles, or drones, can handle tasks that other robots cannot due to gravity. Use of UAVs is increasing although they are not as widespread as the other types of robots. Their main purpose at the moment is inventory checking. However, they can also analyze safety requirements such as racking and fire hazard inspections. Since they can execute their tasks at great heights and in dangerous environments, they also increase the safety of workers. Accidents often result in serious injuries that come with serious costs and a loss in revenue. The average work-related injury results in USD 38,000 indirect expenses and USD 150,000 in indirect costs. Therefore, higher safety levels produce an economic advantage over time.

The FIEGE Group, a leading European logistics company that specializes in efficient supply chain solutions, already completed a successful trial with UAVs when automating stocktaking at one of its multi-user warehouses. doks. innovation GmbH, a German early-stage startup, provided the technology: drones equipped with a barcode scanner and a camera that process the relevant data and forward them to the Warehouse Management System as well as a connected AGV enabling flying times of up to five hours. Stocktaking at this specific warehouse with 30,000 pallet spaces would usually require considerable personnel resources. Having the drone handling the actual job all by itself, it only required three shifts and one supervisor to intervene in case of an emergency. This results in two advantages: decreased labour costs and clearly fewer staff on site, which in times of strict hygiene protocols and a risk of a COVID-19 outbreak is definitely a positive.

What can we take from this?

Robotic applications across intralogistics are definitely an important topic when it comes to process automation and improved productivity.

Logistics service providers should evaluate to what degree they can use robots to keep up with a competitive market environment and rising challenges such as labour shortages, changing customer expectations or fluctuating order structures.

The market potential is huge, and the recent decade has shown that the technology is evolving fast. Also, new business models might come up: Companies do not want to acquire automation assets anymore. Robotics as a Service could be interesting to reduce CAPEX, facilitate more flexible cost structures, and reduce one-time investments, thereby lowering the entry barrier and making technology applications more scalable.

The human workforce remains essential. Robots are there to support human workers on tasks that are dangerous, repetitive or difficult, so they are free for tasks that involve creativity or demanding decision making. Human-robot collaboration shall empower humans and robots to exploit their intrinsic strengths.

Let´s talk!

However, robotics not only present an opportunity for logistics providers but also for venture capital firms (see the startups mentioned above). Therefore, we are very happy to talk to founders that focus on making warehouses smarter and advancing automation across intralogistics. Just drop us a line on LinkedIn or send us an e-mail.

May 2021

How VCs can make a difference for Europe’s LogTech Ecosystem

If you, too, are one of the many whose latest, feverishly awaited online purchase didn’t quite make it to your doorstep at the promised time and had to walk to the nearest post office for collection — well, welcome to the club. The last mile issue is one of logistics’ most apparent ones — but surely not its biggest! Let’s take a look at your “new love in a box” and its journey of challenges:

  • Today, road transport accounts for more than 20% of the world’s total greenhouse gases. This figure is expected to double by 2050. At the same time, the average truck on the road is heavily underutilized, hauling only 60% of what it could carry. One in four is completely empty because no suitable consignment was found that matched its outward journey.
  • Whereas professional logistics players are increasingly automating their warehousing operations, only 18% of online and omnichannel retailers use digital helpers to pick, pack, and ship their goods. The other 82% use a tool called pen and paper.
  • Logistics relies heavily on human workers — not just today, but tomorrow, too. The fact that 94% of Germany’s top 100 logistics companies consider a shortage of manpower a critical challenge is rather distressing. This, in turn, increases the costs of not only road transport but the entire supply chain and simultaneously underlines the need for new, more efficient processes.
  • Further up the stream, alarm bells are ringing: Almost 75% of industrial companies suffered a shortage of critical parts during the Covid-19 crisis because most have only a poor overview of stock levels and expectations about demands on their supply chain.
  • Taking a more global perspective, the process of international shipping involves 25 different parties, such as forwarders, terminal operators, shipping lines, and many more. Shippers continue to complain about a lack of transparency, reliability, and communication in international logistics chains. Digitalization failed to create a common ground.
  • In the end, the likelihood that you will return your product reaches 30%. In the US, returns in 2020 grew by 70%, weighing in at over 2 billion kilograms. Returns not only pose a serious cost and complex burden on a retailer’s logistical operations but are also a real pain for their customers. And to add fuel to the fire, many returned goods are disposed of without ever being in use.
Are traditional T&L companies asleep?

“Wake up, all you logistics giants out there! Pull yourself together and tap these great market opportunities!” You’ll be forgiven for thinking that established logistics players are in a strong position to turn these challenges into chances. Larger logistics companies in particular take a very proactive approach and invest heavily in digitalizing their core. But because margins within the industry are small, established players are strong with exploiting but struggle with exploring. Reinventing yourself while keeping operations at the highest possible level of efficiency is a heroic feat that only few achieve.

Low-hanging fruits for newcomers?

While traditional logistics companies seem unable to address these challenges, technology-driven start-ups with digital business models push into the market with no less a goal than to disrupt the logistics industry. Digital freight forwarders like Sennder or CargoX aim to transform and improve the inefficiency in road cargo for the better. Start-ups like instabox or Gophr work toward a more efficient and convenient delivery on the last mile. And even though freight platforms and last-mile start-ups appear to be venture capital favourites (in terms of funding), areas like warehousing, fleet management, or supply chain visibility are equally challenged by start-ups like Flexe, Smartlane or e2log.

Yet even these young challengers face many problems along the way: a shortage of B2B insights; very long sales cycles; digital infrastructures based on legacy IT systems and a lack of standardization, data availability and quality needed to automate process flows or facilitate new technology like artificial intelligence. Another pain point is the market’s fragmentation and emotional barriers preventing the digitalization of operations. Today, especially small players benefit from their personal network and fail to see the urgency in using digital products. The start-ups’ road to growth is filled with many hurdles and risks. Sufficient venture capital is therefore urgently needed to increase their stamina and punch.

Logistics: A major VC playground?

The many well-funded LogTech grown-ups and unicorns may give rise to the impression that logistics and venture capital have been symbiotically tied to each other for a very long time. Fact is, investors discovered logistics in 2015 only. But they seem to be making up for lost time: According to a recent McKinsey study, logistics start-ups received more than 25 billion USD in funding over the past 6 years. The funding volume grew 17-fold compared to 2014, therefore outperforming overall venture funding growth by far.

Even though there is a lot of money in the market, most of those resources (46%) are allocated to the 10 best-funded start-ups. Among them are names like Lalamove or Manbang. These names may not sound very familiar to you — but six of the ten best-funded logistics start-ups hail from China. No surprise there, since the APAC region accounts for 57% of funding for logistics, while North America contributes 35%. Europe’s overall piece of the global VC cake is negligible (13%), and its share in the logistics segment of 5% is hardly worth mentioning.

Europe therefore lags far behind its Asian and US counterparts, making European logistics start-ups only dream of the money raised in other parts of the world. Yet despite its strong position within the world’s 50 top-ranking logistics service providers, and European companies contributing almost half of the sector’s revenue, it’s surprising that the funding of logistics start-ups is dramatically low compared to the US and China.

This reflects the urgent need for Europe’s tech-based ecosystem to dedicate more funds to logistics start-ups, to minimize the previously mentioned hurdles and risks, and especially to prevent the drain of disruptive technology. Venture capital is a key pillar in defending Europe’s title as logistics champion. We believe a specialized LogTech VC is the right answer to the current situation.

But is it just a lack of money?

Due to this traditional complexity of the industry, where an extensive network is often more important than low prices or service quality, it takes more than cash to advance a start-up to the next level. Venture capital firms must instead provide smart money in relation to networks, industry insights, or access to potential customers to really make a difference for LogTech start-ups. Also, a venture capital firm relies on logistical expertise and industry knowledge to evaluate deal flows and make the right decisions.

How could this even work in practice? Imagine a venture capital firm backed by numerous outstanding logistics corporates. These industry veterans would not only provide the cash but would also pro-actively open doors to the industry. They would share their knowledge and valuable B2B insights to speed up sales cycles and revenue growth. Such an industry network could truly be a shortcut to scaling a LogTech business.

Join the club!

What can we take away from this? Well, for start-ups and venture capitalists, logistics and supply chains are a highly interesting playground!

You need to remember that disrupting an established industry like the logistics sector is not something you do lightly. It’s a supreme discipline that requires both start-ups and VCs to take the right approach and involve industry specialties.

Here at F-LOG Ventures, we give logistics start-ups the very backing that they need: With money on the one hand, but above all with our deeply rooted industry network and expertise on the other.

In fact, we are right where we need to be, at the right time! You’re a LogTech fan or founder? Let’s expedite Europe’s logistics ecosystem together!

Questions, comments, feedback? Or just would like to talk? Find us on LinkedIn (Michael / Daniel)or shoot us a message at michael.geers@f-log.vc / daniel.voss@f-log.vc.

April 2021

Final Closing der F-LOG Ventures

Schwerpunkt Seed und Series-A-Investments in LogTech-Startups

Greven/Münster, 23. April 202

F-LOG Ventures gibt heute offiziell das Final Closing seines neuen LogTech-Fonds bekannt. Dieser Fonds wird vorwiegend in junge internationale, primär europäische Start-ups investieren, die sich in der Seed- oder Series-A-Phase befinden. F-LOG plant initial ab 500.000 Euro in Early-Stage-Unternehmen zu investieren, mit der Absicht, die Portfolio-Unternehmen in Folgerunden weiter zu unterstützen. F-LOG versteht sich nicht nur als vorübergehender Partner von Start-ups, sondern begleitet erfolgreiche Unternehmer bis hin zum Exit mit Logistik-Knowhow und der Möglichkeit des Netzwerk-Zugangs zu seinem Ankerinvestor FIEGE Logistik.

„Wir investieren Venture Capital in eine Branche, in der wir uns auskennen. Mit unserer Erfahrung und unserem Netzwerk entwickeln wir die Start-ups gemeinsam mit den Gründern auf die nächste Stufe, mit dem Ziel, am Ende auch gemeinsam Geld zu verdienen“, sagt Tanja Rosendahl, Managing Partner der F-LOG Ventures. Neben ihr leiten Tim Gudelj als Managing Partner sowie Andreas Pott als CEO den Fonds. Gudelj ergänzt: „Als Finanzinvestor unterstützen wir junge Unternehmen bei der Schaffung von herausragenden Werten, welche einen nachhaltigen Einfluss auf die Logistik und verwandte Branchen haben.“ Dafür bringt das Team langjährige Erfahrung im Bereich Venture Capital als Fondsmanager, Investoren und Gründer mit.

Der USP der F-LOG Ventures zeigt sich vor allem in einem starken Smart-Money-Ansatz. F-LOG bietet nicht nur Kapital für seine Portfoliounternehmen, sondern setzt sich zum Ziel, diesen durch sein starkes Branchennetzwerk sowie -Knowhow proaktiv als Sparringspartner zur Verfügung zu stehen. Andreas Pott: „Wir suchen nach skalierbaren Geschäftsideen, die sich innovativ mit logistischen Informations-, Material- oder Finanzflüssen auseinandersetzen. Wer hier etwas auf die Beine stellt, weckt unser Interesse“.

Weitere Informationen zu F-Log Ventures unter: www.f-log.vc.

Tanja Rosendahl

F-LOG Ventures Management GmbH
Joan-Joseph-Fiege-Straße 1
48268 Greven
Phone +49 (0) 2571 999–0
Mail to: tanja.rosendahl@f-log.vc

Lukas Wilke
Sputnik GmbH
Presse- und Öffentlichkeitsarbeit
Hafenweg 9
48155 Münster
Phone: +49 (251) 62 55 62 23
Mail to: wilke@sputnik-agentur.de

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