Episode Summary
“Digital transformation is not an end, but a means. It’s important to understand that it is simply the process of using technology to improve how you operate your business.”
-Greg White, Host of TECHquila Sunrise
The ‘TECHquila Sunrise’ Series on Supply Chain Now shares the latest investments, acquisitions, innovations, and glorious implosions in Supply Chain Tech every week. If you are looking for a podcast about ‘so-and-so signed a contract with such and such,’ or ‘they just released version 20 of that same technology you didn’t buy last year,’ this is the wrong podcast for you. But if you are looking for real news and innovation, welcome to the Sunrise.
Episode Transcript
Greg White (00:00):
Hey, what is digital transformation? Anyway, this week at tequila sunrise, I’ll tell you what I think about digital transformation and what it means to you. If you’re a tech company, investor or supply chain enterprise, I’ll share insights on the big commerce IPO, the sad state of the rest of the supply chain tech index and this week startup funding updates. So listen up it’s time to wake up to tequila. Sunrise we’re unfortunately, without the aid of tequila, we opened your eyes to how startups and venture investing techs focused on supply chain tech every week, this unholy hour of the day, if you want a taste of how tech startup growth and investment has done, join me every Thursday for another blinding tequila, sunrise, Greg white here from supply chain. Now I am always happy, never satisfied, willing to acknowledge reality, but refusing to be bound by it.
Greg White (01:11):
My goal is to inform and lighten and inspire you in your own supply chain tech journey. Hey, in case you’re listening in supply chain now main channel, you should know, you need to subscribe to tequila, sunrise, wherever you get, your podcasts will only be in the mainstream for a couple of weeks more. Go subscribe to tequila sunrise today. So you don’t miss a thing. You might’ve seen that. I took on another advisory role. I’m working now with clarity capital partners. So my good friend, Steve Keaveny along with his partners, John Stein year, and Mary Roberts invited me to join him. And I felt like it was the right thing to do because they are so committed to helping small and midsize companies with mergers and acquisitions, debt and equity capital, and advising them about the appropriate sources and partners to help them meet their goals. Look, I have been there when you are running a business navigating business finance options is first of all, the last thing you want to do and can seem overwhelming and complex and distracting.
Greg White (02:18):
So I’ve worked with Steve for years and I’ve seen him help companies maximize valuation and select the right financing options to get companies where they want to go. I’m excited to be working with this team and, and to help them get companies in position to take it to the next level or take over a market or take some chips off the table. It’s really gratifying for me and for the team to help founders, executive teams and shareholders make their vision a reality. And whether you need finance, you need help. You need executive and strategy advisory. This team can help you shape your new reality. Look, if you’re considering an equity, raise debt financing, a merger, or even seeking an acquisition, consider the team at clarity. Look as always, you can talk to me first, reach out to me on LinkedIn or reach out directly to Steve at clarity, clarity, exit.com.
Greg White (03:16):
All right, let’s see what’s going on in supply chain tech this week. First, let’s start with the deal ticker. Hey, those smaller deals are down a huge percentage. This year, there are some deals getting done this week. We had 183 funding rounds for $7.8 billion, 70 acquisitions for 36 billion. Remember last week we had 202 funding rounds for 9.8 and 81 acquisitions for 27 billion. So businesses still getting done though, as I’ve talked to some of my favorite small business tech entrepreneurs, money is hard to come by if you don’t already have it. So I’ve got some good news and I’ve got some bad news. Hey, this week on the tequila sunrise supply chain tech stock index, man, that’s a mouthful, a new entrant to the index this week. Congratulations to big commerce, a Shopify competitor for going public. The IPO initially priced at $24 a share and big commerce closed its first day trading up 201% the company went from a pre IPO valuation of $1.5 billion to over 5 billion in valuation in under a week.
Greg White (04:32):
And that’s a big, big move. The stock just over the five days that it’s been trading so far has been up and down as high as 98. I believe now down around in the 75 76 range. Even with that incredible valuation, that’s still a fraction of current member Shopify who is worth $120 billion. Still, as we talked about last week, the big commerce team has reached the big lakes. So stock up, Hey, otherwise not a great week for the index. And particularly week on Tuesday, as a reminder, let’s go through the list of index stocks and the ups and downs. The downs will be tough. The ups pretty easy. Oracle SAP can access Aspen technologies, Manhattan Kupa, Amazon Decart PTC S P S commerce and a plan OpenText and even Shopify all down from last week only park city group and SPS commerce, both up a couple of percentage points are up at all over the last week.
Greg White (05:40):
As I’ve said, I am no stock analyst, but it looks like there is a somewhat of a market correction going on. So I wouldn’t read too much into that. All right, let’s take a look at some of the notable private supply chain deals. As I said, money is tight for startups, particularly early stage and seed startups, but there are deals getting done. And some of these are actual seed deals. So let’s take a look. Return logic, camp Hill, Pennsylvania based returns management platform for retailers raise $2 million in financing. Bankers included rise of the rest seed fund. That’s an interesting fun by revolution funds that is specifically targeting non Valley companies and companies in otherwise under or under appreciated markets, amplify cultivation, capital SAS, venture stout street, capital springtime ventures, and Ben Franklin technology partners who knew old Ben was a tech investor should have guessed, right?
Greg White (06:42):
It looks like this is a early, early stage because the company States that they’ll be using the funds to accelerate key initiatives to build its platform. Founder, Peter Sabata says the company provides a sass returns platform where retailers can enforce their return policies, automate workflows and connect the flow of information across backend operations. That’s really valuable. You know, I’m a big time Hawk on reverse logistics and circular economy and any technology that contributes to that. I really appreciate. So we’ll see how these guys do fleet ops, a Toronto Canada based data-driven freight marketplace raised $6 million in seed funding. The round was co-led by inspired capital resolute ventures, hike, ventures based camp fund, Newark venture partners, BCF pinash and Brian Thomas, all on his own. Brian Good job. The company intends to use the funds to deploy technology and dataset to brokerages around the globe. In 2017, Chris Atkinson founded the company.
Greg White (07:46):
And what fleet ops does is provides a marketplace that matches drivers with shipment opportunities, using vehicle data and AI to secure the driver’s side of their marketplace. They launched white labeled integrations with ELD providers and they partner with brokerages for the shipment side of their marketplace. They use large data sets to produce really advanced algorithms that make recommendations to drivers and to fleets. They offer additional services to drivers, dispatchers, and freight brokerages to help them run their business. In addition to the funding fleet ops is announcing new partnerships with load smart project 44 and ship. Well, all great partnerships. Look, this is a really crowded space. They better be doing something really special if they want to stand out. My quick assessment is that the making of recommendations to drivers and fleets is really, really valuable rather than just presenting the data approved.com a Tel-Aviv based procurement platform completed a $5 million seed funding round lots of supply chain tech coming out of Israel.
Greg White (08:51):
By the way, this round was led by Alef. The company is going to use the funds for global expansion establishing U S operations. There’s some jobs folks investing in growth for its R and D team and supporting new and existing accounts led by bar Winkler. I’m sure no relation to Henry Winkler co founder and CEO approve is a platform to streamline purchasing workflows and vendor interactions and gain critical insights into company. Spend the SAS platform creates custom automated workflows that streamline requests, orders and vendor onboarding. It plugs in with existing ERP solutions and securely sinks with real time budgets. There’s a searchable vendor database that includes updated business information and spend volume as well as unified dashboard that organizes all procurement related data in one place. You know, just in the last couple of weeks, we talked with Omnia partners who is a group purchasing organization for procurement, and this seems like would be a great sync with what they do.
Greg White (09:57):
So I’d love to hear from you procurement professionals out there. You know, that I am not deeply, uh, wise in the procurement space. So I’d love to get some insights into you. See something that really stands out in that marketplace, sand star, a Charlotte, North Carolina and Beijing, China based AI retail tech company received an investment from true digital Corp, a digital arm of true corporation, which is Thailand Telekom, uh, and Thailand cell company. Uh, the amount of the deal, part of a series B plus funding round. I’ll talk to that in just a second. It was not disclosed, but this funding did follow a B round in September, 2019 that brought the total investment to 25 million. So the reason a company would do a B plus round might be to bridge to the next level. Some companies will do a B, B plus, so they don’t have to change the terms and create new documents.
Greg White (10:57):
So this was probably done on the same terms as the B round and just additional capital to get them going, spending whatever the B round was from September till now would be surprising if it weren’t for the fact that nothing is surprising in this day and age previously, the company sand star received investments from Baidu ventures, huge from Ken’s and capital thing, Sean capital [inaudible] capital and Mobike by capital Yili Wu. The CEO says that SA sand star is an AI company that provides computer vision technology for the retail industry, the solutions engage shoppers with grab and go convenience, autonomous checkout, big data analytics for businesses worldwide. In fact, I took a quick look at what they do, and it can actually detect you walking up to what otherwise would be just a regular old cooler, but is effectively vending machine because of the technology that’s applied to it.
Greg White (11:56):
It can identify you identify your preferences and even make recommendations as to what you might want to buy. Based on what’s in the cooler, there’s a little bit about this company that just gives me reason to pause slightly. It seems to be largely hardware. So I don’t see this as a big multiple player, but watch me be raw. Okay. That’s it for deal talk for this week, but let’s start talking about a, another topic. This is a little bit different, the angle than we’ve taken in past episodes, but I have to answer this question. So many people have asked, so many opinions have been given the term is brought up almost every single day, and there are so many definitions of it. Why not just put one more out there? What is digital transformation? Anyway, I’m going to confess this might be as much rant as explanation or education, at least at the start look, this term is both overused and misused.
Greg White (12:53):
So I could be coming from a place of not really needing therapy more than giving education, this term digital transformation it’s of course, all the rage. It’s one of those catch phrases that many don’t really understand like cloud or omni-channel in their early days, like many new terms, it describes something fundamental and sometimes the explanations make the concept harder to get than it ought to be. So let’s take a practical look at what digital transformation is and what it means to you. First of all, digital transformation is not an end, but a means it’s important to understand that it is simply the process of using technology to improve how you operate your business going from manual or even high touch technical processes. It can be as basic as eliminating wasted time lost assignments, or as advanced as monitoring machinery operation and alerting you to take preemptive measures intent is to take advantage of the many ways technology can capture information, store it, analyze and communicate to you as alerts or even recommended decisions.
Greg White (14:07):
So let’s take a look at some examples of digital transformation. One of the most common digital transformations affects families as much as companies consider those hundreds of to do and task management, scheduling applications that are replacing post-its spreadsheets, whiteboards, chalkboards for keeping track of, of what needs to be done along with confirming that it gets done done on time and maybe even done right? The scenario I know of, and we’ll talk a little more about an erosion control contractor that uses a field service app to help their crews who are literally digging ditches surprise and delight their customers and outpace their competition. It sounds crazy, but it happened. Manufacturing companies are using predictive measures enabled by machine learning, mathematical algorithms and an artificial intelligence that require no human intervention to program computers. To know when machinery is operating out of safe or optimal ranges and alert, maintenance, and safety teams on precisely the actions necessary to prevent dangerous or costly catastrophe.
Greg White (15:13):
There are many other examples out there, and if you’re looking to be inspired or even overwhelmed, just look for examples of digital transformation. So what does digital transformation mean for you, your clients, your company, your investors, your world, a digital transformation at a company often means tackling distracting, but important or even menial, but time consuming issues that reduce the efficiency and effectiveness of the people doing the job, such a transformation enables you to get your virtual, uh, expletive deleted together and improve your business to free you and your people from chaos to move you and your team to higher pursuits. Digital transformation enables you to eliminate, or at least get in front of problems in a way you simply can’t without the assistance of Terry technology. So how do you know if you need digital transformation? I get this question all the time and really in no particular order, here are the top ways I’ve found to know if you could benefit fit from a digital transformation.
Greg White (16:21):
One is if chaos reigns due to your inability to get in front of problems, if you are struggling to get job done, to get people on the job, to even know what the job is and assign it to people. If you’re doing mission critical tasks on spreadsheet or worse yet post it notes. I’m sorry, 3m and information is frequently lost or difficult to recall or even recorded incorrectly. If you are constantly saying, I wish X system could talk to Y and my team could know when a happens and we would be in front of problems like Z. If you have custom applications and it’s getting harder and harder to keep them going, or you’re worried about the health of the person, keeping it going. I’m going to tell you a story here in a second about that very thing. If you’re simply frustrated and you know, you need to do something to get better control over your business, but you don’t know where to start.
Greg White (17:25):
You might need a digital transformation. Thank you, Jeff Foxworthy. I want to relay a quote to you from somebody that I did a business with at a UN in a previous life at a previous company called KIRO. So this is the quote we got from one of the people I was redlining every day, just to keep up taking four to five hours to make the schedule. After a 10 hour day out on job sites every day, I’d take 100 calls at all hours of the day and night, mostly answering questions like where do I need to be? How do I get there? Who is the job site contact? How should I do this job? Does this look right? End quote that’s operations manager, Ashley Oester Holt from Watkins erosion in Georgia. Look, Ashley is one of the most even keeled folks you will ever meet.
Greg White (18:16):
He is willing to die to do a great job, but his boss, John Watkins was worried about that exact thing. He was concerned for Ashley and his health now realize this is an erosion control company. They literally literally had ditch diggers, not the first example you’d think of for digital transformation, but they saw the vision. They got it. And they did it. They made communication and coordination so much better. They were on the job site, 45 minutes earlier and 45 minutes on a five person. Crew is a huge hours saving for each job. So the benefit was really, really substantial for them. Look, you can learn from this. Yes. I’m going to call them advanced enterprise Watkins, erosion, and you’ll know whether you need digital transformation or if your technology can deliver one. So let me give you five steps to digital transformation, to do a transformation correctly.
Greg White (19:16):
You really first need to recognize that your goal is to improve your business, not complicate your life or complicate your processes with complex technological initiatives. Just that phrase makes it sound overwhelming. Digital transformation is truly not that hard if you do it right and keep it simple. In fact, you’ll realize that it has been done, right? If it is not that hard, here’s a five step quick start plan to get your own digital transformation going strong. One is to recognize that digital transformation like any change will be impactful and you’ll need those people in your company that will be impacted to be fully on board and bought in to the value and impact of a digital transformation to get buy in to from your team. They need to be aching hurting, coming to you, complaining for the change that you’re proposing. It must be an in your face pain, something they feel every day and they must fear the status quo the current condition more than the change.
Greg White (20:23):
And that’s critical to get a transformation to succeed. People have to be running fast away from their pain. They can’t, they won’t buy into an ROI, big benefits. They will buy into alleviating that fear that haunts them every single day. All right, three attack your big pain using the simplest technological solution possible both the new process, the new business process and the technology itself should be simple. If it’s as easy as hitting a like, or posting an angry tweet, then it will get done for monitor drive and tweak this transformation until the solution is effective. Adoption of the solution is easy and execution of the new process using the solution is sustained and repeatable five demonstrate the benefit for your team. That’s all in capital letters, the people more than your company, you know, you have fixed and you have created a transformation when folks are begging you to tackle their next pain with a digital transformation.
Greg White (21:40):
And you know, you don’t have permission to go on to the next digital transformation until they’re there until they’re completely bought into the transformation you’ve just deployed. Now, once you have done those five steps, go to number one and repeat, keep your focus strictly on the greatest pains, however you, or especially how your team defines them and keep your solutions as simple as possible as you conduct more transformations, you and your team will mature in your approach and be able to take on more complex initiatives, but start simple and start now and start with one. Look in addition to that, if you need help, get it. There are plenty of people out there that can give you free guidance or help guide you through the process and recognize that everyone has a day job in your company. So conducting a transformation may not be in the cards for just the team you have on deck.
Greg White (22:44):
You might need a few people to help you construct and guide and drive and catch flaws in a digital transformation. It’s just possible that running your business day to day has all your you and your team have time for. So if you feel like you or your team don’t have the time or knowledge or skills to get it done, get help. There are many companies, as I said out there to do it. If you don’t know any and you can’t find any, which would be probably tough in this day and age, but if you can’t find any look, don’t hesitate to reach out to me on LinkedIn. I’d love to help you get a leg up and get a transformation done. But again, start simple. Now, get out there and make that business better. You may not believe it quite yet, but that is all you need to know about supply chain tech for this week. Do not forget to get supply chain now, radio.com for more supply chain now, series interviews and events. And please, every Monday it seems like somebody is getting the message. Get your buzz on. Our LinkedIn live stream has been wild. The last couple of Mondays, thousands of people joining us live and tens of thousands, listening to the recording afterwards. So join Scott Luton and me each Monday at noon Eastern
Greg White (24:09):
Time, and find out
Greg White (24:13):
About the important supply chain news of the week. Okay, here it is. Here’s the big pitch,
Greg White (24:19):
Committed
Greg White (24:21):
Subscribe and vibe and enjoy the vibe. Subscribe it. Tequila, sunrise, wherever you get your podcasts. Give me your thoughts and suggestions. I know you have a thanks for spending your time with me and as always remember, acknowledge reality, but never be bound.
Greg White (24:39):
Bye.
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