Competition fierce in supply chain tech

Also: US PE middle market dealmaking holds steady, fundraising slows; Carbon tech startups capture VC interest; Sneak peek of our new agtech research.

Read online | Don't want to receive these emails? Manage your subscription. Log in The Research Pitch September 17, 2022 Sneak peek! We'll give our latest agtech research a wide release on Monday, but you can access a preview of the premium report here. Trending: Did you know we launched dedicated analyst coverage of carbon & emissions tech last week? Get a preview of our debut report here. Update: Translations of our Greater China Venture Report are now available in simplified Chinese and traditional Chinese here.   As supply chains get more complex, opportunities abound for tech Recently supply chains have grabbed the spotlight as volatility in global manufacturing and trade led to scarcity on retailers' shelves, stretched delivery times, stymied production schedules, and crimped profitability. As consumer spending patterns shifted back to emphasize services, warehouses and delivery centers swelled with unsold goods.   Suddenly, instead of maximizing efficiency, building resiliency has emerged as the key concern. In the shift from just-in-time to just-in-case, emerging technology can play a key role, helping to enhance visibility, manage supplier diversity, and improve decision-making. Automation technologies are key to resolving bottlenecks and hastening the flow of goods.   Click to access a larger version in our report preview. Developed and developing economies alike are facing labor shortages at critical nodes along supply chains. The American trucking industry will need tens of thousands of new drivers to meet shipping demand in the coming years. Amazon, the nation's second-largest employer has struggled to flex and adjust its warehousing and fulfillment workforce to meet the volatility of demand for ecommerce. Port operations are struggling. The vast majority of globally traded goods flow through maritime transportation. A recent World Bank study ranked Los Angeles and Long Beach, California—the largest ports in the US—last in efficiency globally in 2021. Labor contracts for US West Coast ports recently expired and negotiations are underway, but a key sticking point is the role of automation. Going forward, emerging technologies look set to exploit numerous opportunities as complexity in global supply chains increases. Worldwide spending on logistics was $9 trillion, or 11%, of global GDP in 2020. Manufacturers are increasingly looking to build resiliency, multi-source parts and materials, regionalize supply chains, and broaden their supplier base. Competition is fierce. Winners in supply chain tech will develop and deploy solutions that manage down costs and enhance and speed decision-making. Our new supply chain tech research delves into the recent volatile VC investment flows in the vertical, looks at emerging opportunities (such as supply chain visibility platforms and drone airspace management and infrastructure), and highlights startups FourKites, project44, and Near Earth Autonomy. Download a preview of our Q2 Supply Chain Tech Report. Clients can log in to read the premium report here. We welcome any questions or comments.   Best, Jonathan Geurkink Analyst, Emerging Technology Share:   Market Updates   PE deal activity in the US middle market totaled $228.2 billion in H1—a sharp drop from 2021's record pace but still on track for a healthy year. Firms have abundant dry powder, and large GPs averse to massive bets in the current environment have eagerly turned to smaller opportunities. Yet the middle market's size advantage in the dealmaking space proves a hindrance when it comes to fundraising, according to our Q2 US PE Middle Market Report. Among the takeaways: The crowded fundraising landscape is expected to have its biggest negative effect on the middle market, as LPs pushed near their allocation limits have prioritized relationships with larger, more-established fund managers. Exit activity fell for the second consecutive quarter, with the cumulative value of $35.6 billion falling below the average quarterly value for the five years pre-pandemic. Deal sizes have trended downward, with middle-market deals over $500 million making up their lowest share of count and value in at least a decade. get the free report     Thematic Research   Postcombustion Carbon Removal Q2 was the best quarter ever for VC investment in carbon capture startups, with $882 million invested across 11 deals. So, why is this flow of venture money increasing? Our latest research examines the various technologies for carbon removal and drivers of interest in postcombustion carbon capture, including its varied approaches. The note also includes a closer look at VC-backed companies in the space, such as Climeworks, Mission Zero and Travertine: read the free research     Webinars & Events   Our head of private markets research and lead EMEA analyst hosted a live discussion this week on the key trends across Europe's private capital markets. How has PE & VC dealmaking been pacing? How have our 2022 predictions held up? For all the updates on Europe-based deals, exits and fundraising activity, watch the recording.   In the News   Our insights and data featured in the press: The key to the successful companies of the future lies in innovation: "It's about focusing on something unique, rather than something that's there to just grow, and add to a broader landscape." [FT] While there are a growing number of carbon capture companies that are attractive to VCs, regulations and policies are also lining up to make them a particularly enticing investment. [Protocol] "The IPO wave of 2021 came and went without significant outcomes for horizontal AI startups, leaving questions as to the market size for AI software and opportunities for AI chip companies." [TechCrunch+] Debt remains a small slice of total venture funding, but its share of the market is increasing. [Bloomberg] If you're a journalist interested in interviewing our analysts or requesting data, contact our PR team.   ICYMI   Highlights from our other recent research: Market updates UK & Ireland Private Capital Breakdown VC Quantitative Perspectives: Silver Linings on the Time Horizon Global Markets Snapshot: August Global Real Estate Report Global Private Markets Fundraising Report Thematic research Serial Entrepreneurs Raise More Capital, but at What Cost? Subsector and Startup Profile: Real Estate Tokenization + Lofty Key Takeaways and Benchmarking for Blackstone and US Public PE Firms Hydrogen Fuel Cells Back in the Spotlight Emerging Technology Research Carbon & Emissions Tech AI & Machine Learning Insurtech Emerging Tech Indicator Foodtech Coming next week (subject to change) Analyzing the impact of VC down rounds ETR: Agtech   Thanks for reading! Feel free to email us any time with feedback, questions, or tips! Learn more about the PitchBook Institutional Research Group, meet our analysts, or access our research libraries for clients and non-clients. Were you forwarded this newsletter? Sign up at pitchbook.com/subscribe.   Since yesterday, the PitchBook Platform added: 788 Deals 4095 People 1043 Companies 60 Funds See what our data software can do   About PitchBook | Terms of use | Advertise with us | Contact Follow us: This email was sent to pitchbook@quicklydone.com via the PitchBook Platform. 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