AI in Logistics: Emerging Startups, Remaining Challenges and New Models

The drivers behind innovation in logistics and key players.

Yuliya Sychikova
COO @ DataRoot Labs
16 May 2019
8 min read
AI in Logistics: Emerging Startups, Remaining Challenges and New Models

Artificial intelligence is hitting new adoption levels each year, with industries like supply chain management and logistics taking center stage in the AI race. As per Infoholic Research, the AI in logistics and supply chain market is predicted to grow at a CAGR of 42.9% over 2017-2023 to reach $6.5 billion by 2023.

The process complexity and amounts of data generated by the industry call for a higher tighter structure and transparency through digitalization. Operational challenges aside, people want their stuff right now – be it a multinational corporation awaiting new equipment or an Amazon customer expecting their gifts come holiday season. In today’s world, the speed of delivery matters more than ever. In addition to speed, customers demand deliveries and pick-ups at a specific time slot, adding a layer of complexity to route optimization. Then there’s the question of pricing.

At the age of online price transparency, companies are expected to deliver a higher quality of service at lower costs, putting pressure on company margins and pushing them toward labor automation. There are just too many moving parts to this industry for it to persist without AI and the augmentation. With multiple players across different parts of the supply chain, regulators, a vast number of third parties including subcontractors, operators, airlines – this is literally too big to fail, but it’s certainly prone to economic stagnation and hard losses if the whole setup does not adapt to the modern age.

M&A Activity in Logistics and supply chain

A lot of innovation is happening in the logistics sector. We see ride-hailing companies consolidating, industry incumbents adding innovative tech solutions or top talent to strengthen their departments through the acquisitions. While there were plenty of impressive acquisitions in 2019 alone, we predict many more to come in the next few years as the industry continues to be technologically disrupted. In the table below, we summarize the most recent tech acquisitions in logistics, transportation, and smart mobility space.

CompanyHQ / year foundedAmount Raised, $Deal Amount, $AcquirerDeal Rationale
Aramex (India operations) Dubai, UAEN/AN/ADelhiveryThe acquisition would likely strengthen Delhivery's foothold into the e-commerce logistics market in India.
Careem Networks Dubai, UAE / 2012772M3100MUberUber is buying a dominant competitor in a strategically important MENA region.
Drive.ai San Francisco, US / 201577MN/AAppleThe Drive.ai has been working on AI tech for autonomous vehicles for a few years, but ran into cash shortage problems and got picked up by Apple.
Grab India / 20147MN/ARelianceWith this acquisition, Reliance Industries Limited will control 83% equity of Grab. The investment will further augment the group’s digital commerce initiatives and strengthen its logistics services, catering to both B2B and B2C segments.
Journey Holding Corporation US / 2018 N/AN/AFordAs Ford seeks to scale up its new mobility business, it acquired the company that has developed vehicle tracking software and app-based technology designed for public transportation.
Mighty AI Seattle, US / 2014 27MN/AUberUber will acquire Mighty AI’s intellectual property, tooling, tech talent, and labeling community, the startup will shut down post acquisition.
Octopi USN/AN/ANavisBy acquiring Octopi, a cloud-based TOS built for small container and mixed cargo terminals, Navi strengthens its positions in movement of cargo market.
Pickup.ai IndiaN/AN/AOlaPikup.ai uses artificial intelligence, computer vision, and sensor fusion to provide seamless AI-powered solutions for businesses, synergic with Ola's business.
Quantum Signal US / 1999N/AN/AFordTo bolster modeling simulation for autonomous vehicles, Ford bought small robotics company and defense contractor known for mobile robotics and real-time simulation.
ScottyLab San Francisco/ 20176MN/ADoordashWith the acquisition ofScottyLabs, Doordash buys autonomous and remote-controlled vehicle technology.
Torq Robotics US / 2005N/AN/ADaimlerTo accelerate autonomous truck development with a majority stake acquisition in self-driving vehicle company Torc Robotics.

AI-Enabled Startups in the global logistics industry

Based on public information gathered from Crunchbase and other sources, we have compiled a list of startups that bring artificial intelligence to the global logistics industry. Every logistics tech startup carries a unique approach to AI, and some of them have already operationalized several use cases.

To highlight a few cases, the Finnish startup founded in 2011, ZenRobotics has been developing intelligent robotic waste sorting systems. By leveraging computer vision and machine learning algorithms, they developed the ZRR2 robotics system that sorts and picks recyclables from moving conveyor belts.

Nuro a Californian startup founded by ex-Google employees, has announced a $1 billion investment round from Softbank. The startup produces R-1 robots, which can carry many products on board, can cross sidewalks and even climb stairs to make deliveries and due to its slimness, are safer than most alternatives.

Robby Technologies founded in 2016 and backed by YCombinator is developing Robby 2, an autonomous vehicle with advanced AI for navigation and interaction capabilities. It can navigate not only roads but also sidewalks, pedestrians, and rail crossings. It is also equipped with conversational AI to encourage interaction between humans and the robot. For example, if a person blocks Robby’s path, Robby will say “excuse me” and “thank you”.

Satellite imagery company DigitalGlobe high-resolution pictures of the planet’s surface to ride-sharing giant Uber. These images provide rich input sources for the development of advanced mapping tools to increase the precision of pick up, navigation, and drop off between its drivers and riders. DigitalGlobe’s satellites can decipher new road-surface markings, lane information, and street-scale changes to traffic patterns before a city adds them to its official vector map.

This is not an exclusive list of AI logistics startups list – feel free to add more companies in the comment section at the end of this article – we’ll make sure to add them to our knowledge base.

CompanyHQ / year foundedAmount Raised, $InvestorsWhat they are doing
6 River Systems Boston, MA / 201546MMenlo Ventures, Norwest Venture Partners Flexible and scalable warehouse automation that engages associates, keeps them on task and provides a 2-3x productivity boost.
Aurora Palo Alto, CA / 201690MGreylock Partners, Index VenturesA self-driving vehicle company that works at the intersection of engineering and applied machine learning to transform the way people and goods move.
Bossa Nova Robotics San Francisco, CA / 200569.6MCota Capital, Paxion Capital PartnersA real-time, on-shelf product data provider for the global retail industry. Its technology collects terabytes of data that enables the retail ecosystem to optimize the omnichannel shopping experience.
Boxbot San Francisco, CA / 20169MArtiman VenturesIntegrates years of advancements in robotics and autonomous technologies to optimize last-mile logistics, which is the single most expensive part of any delivery.
Bykea Pakistan / 20165.7MMiddle East Venture PartnersThis Pakistani on-demand transport, logistics, and payments startup claims to have 2 million app users and a fleet of over 200K driver-partners, the larges in Pakistan. It enables users to book services through an Interactive Voice Response (IVR) solution.
Cargofy California, CA / 2014N/AIowa Startup AcceleratorCargofy is a mobile assistant, kind of a “Siri” but for truck drivers. Cargofy helps truckers access high paying loads through an app, and receive discounts on fuel, maintenance, and truck parts.
CargoX Sao Paulo, Brazil / 201395MBlackstone Group, Goldman SachsA technology-powered freight broker that provides shippers with an efficient solution to transport the most diverse types of products in any part of Brazil. The service is based on a technology that has a growing fleet of 100,000 truckers.
ClearMetal San Francisco, CA / 201412MInnovation Endeavours, Prelude Ventures, Skyview CapitalA Supply Chain Visibility Software company that builds data-driven products to solve the most complex operational problems in supply chaiт to make trade data organized, accessible, predictive, and actionable.
Convoy Seattle, WA / 2015265.5MCapitalG, Y Combinator, Greylock PartnersA marketplace that connects shippers with nearby trucks (‘carriers’) and books jobs instantly.
Drive.ai Mountain View, CA / 201591MNew Enterprise Associates, Nvidia GPU VenturesAI software for autonomous vehicles based on deep learning technology.
Fleet Portland, OR / 201414MLufthansa Cargo, Hunt Technology Ventures, Avala CapitalAn online platform that businesses use to book and manage transportation for international freight. Fleet provides instant quotes, improved decision making by showing provider lead times, ratings and reliability, direct access to all of the service providers and a team room to communicate directly with service providers for status and view shipping documents.
Flexport San Francisco, CA / 2013304MS.F. Express, DST Global, Founders FundA licensed customs brokerage and freight operator built around a modern web application, that includes such services as an online dashboard for businesses to easily understand, purchase, manage and track the services required for global trade.
FreightHub Berlin, Germany / 201623MNorthzone, Cherry Ventures, Global Founders CapitalThe digital freight forwarder and a digital interface to manage user logistics. It features past, current, and future freight shipments, keeps track of missing documents, uploads all files and stores them for future use, and offers real-time freight tracking.
Freightos Hong Kong92.7MSingapore Exchange Limited, GE Ventures, Annox Capital, AlephAn online freight marketplace and powerful international freight routing/pricing technology that helps importers and exporters reduce logistic expenses and save time with an instant comparison, booking, and management of air, ocean, and land shipments.
GreyOrange Singapore / 2011170MMithril Capital Management, Tiger Global Management, Blume Ventures, BITS Spark AngelsThe company creates hardware and software products for warehousing industry and builds products for logistics fulfillment in order to increase order picking and parcel sortation rates and reduce the time it takes to replenish store inventory and get orders to consumers.
Locus Robotics Wilmington, MA / 201433MScale Venture Partners A warehouse robotics company that manufactures autonomous, mobile robots to support e-commerce operations for retailers and warehouse logistics providers.
Loginext Fremont, CA / 201410.6MAlibaba through One97 Communication, PaytmLogistic and field workforce solutions to plan, optimize, track, and analyze resource and asset movement in real-time, offering field workforce optimization, real-time tracking, route optimization, resource allocation automation, long-haul trucking, and on-demand management to more than 250 enterprise clients.
Marble San Francisco, CA / 201510MLemnos VC, Tencent Holdings, Maven VenturesCreates a fleet of intelligent courier robots to reliably and securely transport the goods.
Nautilus Labs New York, NY / 20162MRoot Ventures, angels A proprietary data collection & storage system for the commercial shipping industry to help them burn up to 30% less fuel.
New York Shipping Exchange (NYSHEX) New York, NY / 201413MGE Ventures, Goldman Sachs, Blumberg CapitalNYSHEX provides an alternative to the unpredictable spot market and volatility of freight rates.
Nuro Mountain View, CA / 201692MGaorong Capital, Greylock PartnersA self-driving delivery startup which accelerates the benefits of robotics for everyday life.
Package.ai Tel Aviv, Israel / 2016N/AICONYC Labs A software and Artificial Intelligence (AI) for optimizing last-mile delivery operations and experiences. package.ai has developed Jenny, a conversational agent that can contact parcel recipients via Facebook Messenger or SMS to coordinate delivery times, locations, and other specialized instructions.
Peloton San Francisco, CA / 201178.4MOmnitracs, Denso, Intel CapitalPeloton's system uses radar and DSRC vehicle-to-vehicle communications to link active safety systems between pairs of trucks, reducing collision-related expenses and fuel costs. The dramatic reduction in aerodynamic drag in these platoons provides substantial improvements in fuel economy for both the trailing and leading trucks: with on-road testing showing average savings over 7% between the two trucks.
Qopius Paris, France / 20152M360 Capital Partners Retail Computer Vision Platform automating and digitizing retail using computer vision to enable retailers and brands to track out-of-stock, price issues, and compliance in real-time using autonomous robots, IoT cameras and smartphones.
Roadstar.ai Shenzhen, China140MShenzhen Capital Group, Wu CapitalEmpowers cars and trucks with artificial intelligence to make transportation safer, more enjoyable, more efficient.
RobbyTechcnologies N/A / 20165.5MY Combinator, FoundersX, Silicon Valley Future CapitalRobby Technologies is building self-driving robots to deliver food and packages autonomously to users' doorsteps.
Shippo San Francisco, CA / 201329.3MBessemer Venture Partners, Union Square Ventures, angels, Slow Ventures, Plug and PlayA multi-carrier shipping API and web app for marketplaces, warehouses, and e-commerce businesses. The company processes millions of shipments per month for more than 35,000 customers. Businesses are able to instantly access multiple shipping carriers for real-time rates, shipping labels, international paperwork, package tracking, and return logistics.
Smarter Sorting Austin, TX / 20159.3MRTP Ventures, McCune Capital, othersA machine learning solution for waste management that allows municipalities to take waste of extreme negative value and use proprietary software to sort that waste into high-value commodities that are sold into established markets.
Starship Technologies San Francisco, CA / 201242.2MDaimler, Playfair Capital, Grishin Robotics, Matrix Partners, angelsDevelops fleets of self-driving delivery robots, designed to deliver goods locally within 30 minutes. The robots drive autonomously 99% of the time to make safe and environmentally friendly curb-side deliveries from a local hub.
TradeGecko Singapore/ 201217.7MAura Venture Fund, TNB Aura Fund, Jungle Ventures, Openspace Ventures Inventory and order management platform for modern wholesale merchants, integrating sales channels, logistics providers, and accounting services.
Transmetrics Sofia, Bulgaria / 20131.8MLAUNCHub VenturesProvides cargo companies with data cleansing, demand forecasting and network optimization based on AI and predictive analytics allowing transport companies to improve their capacity utilization, achieve significant savings and reduce their environmental impact.
Tusimple US / 2015287MUPS, Nvidia, ZP Capital and Sina TuSimple develops all of the technological pieces required for autonomous driving. TuSimple is developing a Level 4 system, a designation by the SAE that means the vehicle takes over all of the driving in certain conditions.
Voyage Santa Clara, CA / 201720.2MInMotion Ventures, Khosla Ventures, Amino CapitalAutonomous vehicles company working to bring about the end-goal of self-driving cars: a world where anyone, anywhere can summon a car directly to their doorstep, travel safely to their destination, all for an extremely low price.
We4Sea Delft, Netherlands / 20160.45MMainport Innovation FundA cloud platform that offers solutions to optimize the performance of large commercial (cargo) ships.
ZenRobotics Helsinki, Finland / 200716MInvus, Lifeline Ventures, EASME, Finnvera Venture Capital
Zoox Foster City, CA / 2014790MGrok Ventures, Blackbird Ventures, DFJ, Lux CapitalAutonomous mobility-as-a-service, operating at the intersection of design, computer science, and electro-mechanical engineering.

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Yuliya Sychikova
Yuliya Sychikova
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Author

Yuliya Sychikova
COO @ DataRoot Labs
Yuliya is a co-founder and COO of DataRoot Labs, where she oversees operations, sales, communication, and Startup Venture Services. She brings onboard business and venture capital experience that she gained at a leading tech investment company in CEE, where she oversaw numerous deals and managed a portfolio across various tech niches including AI and IT service companies.

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Max Frolov
CEO @ DataRoot Labs
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Max Frolov
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