Funding tighter but still ‘a lot of innovation’ in FreightTech

“We see a lot of innovation in the FreightTech space. Everyone’s attracted to anything that’s AI, but we’re seeing a lot of specific innovation in the cash payment processing cycle. It’s not super exciting, but it’s something that helps the efficiency in the back office. We’re also seeing a lot of interesting technologies within the warehouse — a lot of things related to robotics and technology. The last big area where we’re seeing interest: We know the transition to fully autonomous [trucking] isn’t going to happen overnight, so we’re seeing a lot of bridging applications, from where the environment is now to where it’s going to be 10, 15 years down the road.”

On how Autotech Ventures vets startups: “A significant amount of the capital we’re investing comes from our limited partners … [that are] transportation and logistics providers and companies that do manufacturing and things across the supply chain. That creates a good flywheel for us and gives us a great network to go out and do due diligence and ask questions about what we’re getting pitched. We see things from 25,000 feet and we can ask: How does that work at ground level? We can talk to people who are using some of this technology day to day.”

On what VCs are looking for in founders: “Like a lot of VCs, we’re always happy with the founders that have the right pedigree or have some successful exits. No doubt that’s important to us and something we consider, but definitely, in the FreightTech space, the thing we really care about is people who know the space very well. One of the lessons of the last four or five years is that this is a unique space. Having [founders] that have spent time in the transportation space in different capacities — who know the industry and know the market — is very important to us. It’s also a more challenging market right now, and things have changed with the availability of funding, so we want founders who are going to be able to grind, and work hard. When the cycle was in everybody’s favor and there was a lot of freight, that created a lot of opportunity, but this is certainly a different market from a cyclical standpoint, and it takes a different kind of founder to navigate these markets.”