Silicon crash ‘puts kibosh on supply chain tech acquisitions’ 2023

PitchBook reports 45% drop in supply chain technology VC investments in Q1 2023, possibly due to Silicon Bank bankruptcy.
A recent analysis suggests that Silicon Valley Bank’s bankruptcy caused a 50% drop in supply chain tech venture capital (VC) investment in 2023 compared to Q4 2023.

PitchBook delivers M&A, private equity, and venture capital statistics, industry news, and commentary.

Its Supply Chain Tech Report for Q1 2023 indicates that supply chain tech businesses’ venture capital (VC) agreements declined by over half (45.3%) from Q4 2022, with 19.4% fewer deals. VC transactions fell 46.4% year-over-year.

The top three acquisitions accounted for over one-third of the total, and corporate supply chain management was the only category where investment kept stable, according to PitchBook.

It also shows that the value of supply chain tech deals in 2022 was similar to the norm for 2018–2020, before the massive pandemic-fueled surge in 2021.

PitchBook blames the VC transaction slump on Silicon Valley Bank’s March 10 failure. The $212bn tech-lender’s failure caused the worst financial crisis since 2008 and Credit Suisse’s fall weeks later.

Sweden excels in VC supply chain agreements.

Sweden has two of the biggest freight tech VC transactions in Q1 2023.

Einride, a Swedish autonomous truck firm, raised $500mn. Volta Trucks, a Swedish trucking company, signed the third-largest Q1 transaction, $295.3mn, to develop its 7.5-ton and 12-ton electric vehicle trucks.

Enterprise supply chain management, last-mile delivery, and warehousing tech witnessed moderate quarter-on-quarter value growth in vertical supply chain tech.

PitchBook covers Locus Robotics’ $117mn Q4 2022 VC transaction, which nearly quadrupled its valuation to $1.8bn.

Locus Robotics, founded in 2015, is quickly deploying its autonomous mobile robots, according to the article. In spring 2022, LocusOne warehouse orchestration powered 10,000 robots.

Its fleet of robots ranges from wheeled, kiosk-like machines that collaborate with warehouse workers to scan and choose items to AMRs like Locus Vector and Locus Max, which can lift and move boxes, roll shelves, and even hoist plus-size pallet loads. The 2021 Waypoint Robotics acquisition included Vector and Max.

The deal supports a Gartner Group analysis that revealed 95% of supply chain organizations have engaged in, or plan to invest in, cyber-physical automation to address labor shortages, according to PitchBook.

Locus’ services “offer advantages over traditional materials-handling solutions, which can be capital-intensive,” the paper says. They can be introduced and scaled inside current warehouse layouts in four weeks.

“Flexibility in deployment allows seasonal activity variation and easy redeployment to other facilities. Locus’s robotics-as-a-service concept allows deployment as an operational expenditure instead of a big capital investment. The company’s robots chose 230 million products—3.3 million each day—for the 2022 Christmas season, increasing volume from the year before.

Leave a Reply