Coros raises $6.1M to bring computer vision to e-commerce parcel fulfillment

Dynamo moved quickly to invest in Coros, sending a term sheet two weeks after first meeting the founding team and closing the round within about five weeks total. An abundance of available capital in private markets has encouraged venture capitalists to see deal velocity as an increasingly important part of their value proposition. That said, Hitch affirmed that Dynamo’s deep domain expertise — the sector-specific firm focuses on supply chain technology startups — is especially valuable for seed-stage companies.

Hitch explained that Coros’ solution is meant to help parcel shippers rise to the challenge of mounting e-commerce volumes and mounting consumer expectations for on-time delivery and order accuracy. More than 3 billion parcels were shipped in the United States between Thanksgiving and Christmas in 2020. Meanwhile, survey data indicates that consumers have very little tolerance for last-mile delivery errors, with most consumers saying they’ll stop shopping at a merchant after just two or three delivery errors.

“There’s a perfect storm of volume going up, expectations going higher, and the solution today is to throw more labor at it,” Hitch said. “But you only have to look at any media outlet on any given day to understand that there isn’t any labor.”

At fulfillment centers, parcels fall off conveyor belts, are not loaded into a trailer before it’s cut, or are loaded into the wrong trailer. When those kinds of mistakes occur at the fulfillment center, on-time delivery rates plummet; more often than not the only lever available to the shipper is to upgrade the parcel’s service level with the carrier, substantially increasing shipment costs.

“We can close the gap between the WMS plan and what actually happens by driving real-time data that becomes the source of truth and enabling our customers to make those changes on the fly,” Hitch said. “We increase load accuracy so that on-time delivery performance is more likely to happen. If you start there at the shipper facility and get that right, and the trailer leaves on time by its cutoff with the right load, the likelihood is that all those delivery commitments will be met.”

While Coros’ primary focus is ensuring load accuracy at the shipper facility, it’s also running tests with FedEx to move its visibility solution all the way downstream to the final-mile delivery vehicle, the loading and unloading of which is another crucial handoff point.

Hitch said that enterprise shippers demand solutions that are truly scalable, reliable and secure, and that’s what Coros has worked toward. While Coros designed its scanners, which can be self-installed by the customer above loading bay doors in less than one hour, the company has eschewed deep-tech hardware component development to focus on the software platform that powers Coros’ vision system, alerts and WMS integrations.