Cheng Lu

The autonomous trucking industry has faced significant challenges in recent years. In 2023, Embark was acquired by Applied Intuition for $71M, a mere fraction of its $4.5B valuation when going public via SPAC in 2021. Waymo Via, the commercial trucking unit of Google's autonomous vehicle division, shifted its focus from trucking to ride-hailing. TuSimple, once a leader in US autonomous trucking, wound down its US operations to concentrate on China and Japan. Despite this backdrop, Harpoon portfolio company Kodiak has continued to make waves in autonomy for trucking and defense, reflecting its resiliency as a leader in the space, and setting the stage for widespread industry adoption in the coming years. The US trucking industry, a massive $940B market, faces critical challenges that Kodiak aims to address: a severe driver shortage expected to double in the next decade, increasing freight demands driven by e-commerce, and stringent government regulations on driver working hours that impact delivery efficiency and truck utilization. Kodiak's market leading approach tackles these industry challenges with its modular system, the Kodiak Driver, which seamlessly retrofits any driving platform with autonomous capabilities. The company has achieved significant milestones to-date, including disengage-free commercial deliveries, 24/7 operations, delivery of over 4,500 loads, and partnerships with some of the world’s top logistics companies. Kodiak leverages a world-class team from leading self-driving programs, positioning itself uniquely in the market. Its incremental deployment strategy and partnerships with existing fleets for rapid technology scaling demonstrate a pragmatic and efficient path for growth. With the increasing demand for freight and the urgent need to address the driver shortage, Kodiak is poised to transform the trucking industry as it progresses towards fully autonomous capabilities.

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Autonomous Vehicle (AV) funding is surging, according to PitchBook with Q2 2024 seeing $2.9 billion invested in AV startups - the highest since Q3 2021. While self-driving cars grab headlines, innovative startups are finding unique applications beyond passenger vehicles. Key developments: - Supply chain optimization: Outrider is revolutionizing yard operations with autonomous electric vehicles, addressing a $60 billion market. - Specialized transport: Pyka's autonomous planes for cargo and Gatik's local distribution trucks are gaining traction. - Safety & efficiency: Evitado Technologies automates airside operations, mitigating airport collision risks. Of course, more established companies such as Lyft & Uber are working on AV rideshare integration via partnerships with Waymo, BYD, Zoox, and others. The AV sector is focusing on gradual integration and specific use cases. While concerns about job displacement exist, proponents argue that automation could shift human capital to higher-value roles. What those roles are remains to be seen. As the AV landscape evolves, it's clear that the future of transportation extends far beyond just self-driving cars on city streets. Check out the full article by Nadine Manske here: https://lnkd.in/g3HJXZHc? And access the PitchBook Mobility Tech Report here: https://lnkd.in/g4_xP5pr #VentureCapital #AutonomousDriving #FrontierTech #FutureMobility

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I'm pleased to share that Lightrock has continued to support Thomas Doering and Distribusion Technologies in their $80 million Series C funding round. Distribusion is the leading global B2B ground transportation marketplace, addressing inefficiencies in this €700 billion market. The industry’s progress has been hindered by legacy technology, making multi-modal travel planning and booking difficult and time-consuming. This increases costs for consumers and negatively impacts sustainability as travellers opt for private cars and taxis over less polluting transportation options. Using a single API, Distribusion connects transport carriers like National Express LLC, Amtrak, and Deutsche Bahn with retailers such as Expedia Group, Google Maps, and Alipay. This allows consumers to seamlessly compare and purchase tickets on trusted platforms. There's a high likelihood that Distribusion has facilitated your travel without you knowing it. We led the company's Series B in 2022, and since then Distribusion has grown tenfold, creating the largest global B2B network of ground transport operators. This growth, combined with achieving profitability, has encouraged us to reinvest and continue with this company on this exciting journey. We look forward to continuing our work with this team. Learn more about #Distribusion via the link in the comments. #TravelTech #FutureOfTravel

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Fun session with Silas Mähner 🔍🌎 Hopefully non controversial takes on how we think about adaptation and resilience Third Sphere. Also weighed in on thinking about engagement with Big Oil. Absolutely not possible to generalize here. TLDR on one end of the spectrum is Norway, generating substantial GDP from oil, but leading the way across multiple climate efforts, like EVs and heatpumps. On the other end are some state actors that have worked to undermine organizations like COP and sew broader chaos, very, very likely as a way to shift resources away from energy transition (likely very, very hard to spend on defense and green transition at the same time in the US and EU, for example).

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Insightful breakdown from my great Partner Omri Amirav-Drory on the simple factors that really separate the top 1% of investors from the rest, and how more operators should become investors! https://lnkd.in/gEiZdT2h

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Kudos to aifleet on its $16.6M raise to fund growth in tech-enabled trucking. Its investors include Heron Rock Volvo Group Venture Capital, Obvious Ventures, Ibex Investors, Compound, Winthrop Square Capital and Cooley LLP. Aifleet is doing something different. Most other startups in this field are focused on pure technology. They have 204 drivers and power units. Will they be able to make it work with a combination of trucking and technology? https://lnkd.in/ePytPHx7

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PE - AI & Scarcity of Software Engineers Robert F. Smith of Vista Equity compared the scarcity of software engineers to resources rarer than gold, underscoring their high demand. However, today AI's growing ability to write code will transform Tech PE by accelerating software development and creation. Key impacts include: • More scalable software • Improved code quality • Shift in developer roles • Faster development cycles • Reduced development costs • Faster innovation and prototyping • Custom solutions for larger customers • Risk mitigation with AI-assisted debugging • Competitive advantage for early AI adopters • Lower barriers for scaling software development AI will amplify developer productivity, not replace them, and PE firms integrating AI into portfolio workflows can unlock the next wave of growth. ------------------ #pe #privateequity #investing #ai

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Since early 2021, VC quarterly exit values have plummeted to $50B or below, a stark contrast to the six consecutive quarters of $100B+ exits before then. With IPOs dwindling and M&A activity slow, the future of venture industry exits appears uncertain. Will we see a surge in private venture-backed company acquisitions? This could be a crucial and innovative strategy to boost VC exits. Increased private acquisitions might offer a much-needed lifeline, providing a creative solution to the current exit drought in the venture capital market. #venturecapital #inspireglobalventures

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LP Tip #8 of #50: Your LP base should match your fund size. We are back with our regular programming. ➡️ Opinions are always my own and based on my experience.  ➡️ My focus for this post is on sub $200.0M funds. ➡️ The $ amounts I state below are guideposts never absolute rules.  ➡️ Some LPs want to have a certain % of the fund and size their investments in this way; others have set check sizes irrespective of fund size. I continue to be surprised at how much time new GPs waste with LPs that are unlikely to invest. I urge managers to better qualify LP leads and be extremely judicious with how they manage their time. In my experience there are 6 LP types that I consistently come across. See below. ▶️ Non- Institutional LPs:  1️⃣ High net worth individuals (HNWI) - There are different tiers of HNWI but assume that this is someone with at least $1.0M in net worth in liquid assets. In my experience they are the fastest to close and conduct limited diligence. I often see them investing $100K - $500K checks in funds. It is possible for a fund manager to close a $5.0M fund on entirely HNWIs. 2️⃣ Family Office - There are different types of family offices. For simplicity sake let us assume that this is a single-family office with an investment team and a set venture allocation. Keep in mind that family offices are hard to find because they do not want to be found. Typically, you find these via referrals from other GPs or your current LPs. I often see <=$50.0M funds composed of HNWI and family office LPs. I have seen a range of investment checks form family offices. 3️⃣ Corporate - I include banks in this category. Due to the market downturn these entities either halted or slowed pacing. In my experience I have seen corporates invest anywhere from $500K - $10.0M checks. This type of LP is often present in sub < $100M funds. ▶️ Institutional LPs:   4️⃣ Fund of Funds (FoFs) - Unlike the other LP types, FoFs need to raise from LPs. I have seen FoFs invest in fund sizes across the spectrum. Depending on the FoF they can invest in funds as small as $15.0M. 5️⃣ Foundations -  These are often investing to align with their mission. I would spend time understanding how you complement their programmatic work. I have seen foundations invest in $45.0M funds and above.  6️⃣ University Endowments - Endowments is where most new GPs waste time. It is important to ask if the university has an emerging manager program upfront. I have seen emerging manager programs invest in small funds ($25.0M - $65.0M). It also helps if the GP was an active alum of the university or had some unique relationship to the university.  If there is no emerging manager program I am often told that there should be a fund target on the low-end of anywhere b/w $150.0M - $200.0M to be considered.

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2024 Halftime – Complicated VC Landscape… There are two important considerations that will frame the venture capital narrative for the remainder of the year: the elections and financial condition of the country. According to Bank of America, 2024 will see national elections in countries that account for 60% of the global GDP and 40% of the world’s population, with the U.S. election arguably being the most seminal. The U.S. election is in 119 days and our national debt is increasing approximately $1.0 trillion every 100 days… Thoughts on what to expect in 2H24… https://lnkd.in/e-5tAPF6 Flare Capital Partners #digitalhealth

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Last week the FT ran a controversial piece that discussed the decline of venture backed startups in China. Critics say the report was misleading or the underlying data was incomplete. I actually think the discussion sparked by the report misses a more important point: looking at historical data is irrelevant, if not outright misleading, when faced with a coming platform disruption. The more important question facing countries now is how best to position themselves to take advantage of the opportunity in the coming age of generative AI. New technologies bring in new founders, and those founders have different needs. I wrote a post examining how the technology innovation shift is an opportunity to re-rank the global tech leaderboard. https://lnkd.in/g4yzc_39

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This first-of-a-kind industry partnership signals we are entering a new era of autonomy in the warehouse—where intelligent automation is managing unprecedented complexity at scale and delivering real competitive advantage to businesses.

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Recently listened to a great discussion by All-In Podcast on the potential breakup of Google—arguably the biggest since AT&T. The episode brings up key points on how splitting Google into entities like Search/Data, Advertising, YouTube, and Android could impact shareholders and innovation. Should Google take the lead before the DOJ forces the change? I'm leaning toward the idea that strategic foresight is essential here. Curious to hear your thoughts—check out the episode here: https://bit.ly/3WY8z0G

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Surprising to see two mega mergers getting past antitrust: - The $53B Chevron-Hess merger - The DirecTV-Dish merger where AT&T is selling its stake in DirecTV for $7.6B to TPG and DirecTV buying Dish for $1 and taking on its $10B in debt What does it mean for consumers? And what does it mean for the M&A market? These approvals may signal a shift in antitrust policy. Looks like they're prioritizing global competitiveness over strict market share considerations. This might invite additional scrutiny on how these mergers impact innovation in bigtech. These mega mergers usually tend to have a strong impact on consumer choice and pricing. The industry dynamics will be closely watched by regulators and investors.

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👀 Looking at our recent investments at Draper Associates, here’s what standout founders nailed, making our decision to invest much easier (and faster): 💥 Visionary Tech with a Bold Vision – These founders are not here for incremental wins; they’re reimagining what’s possible in across tech - biotech, robotics, aerospace, and beyond. Their vision is big and audacious, tackling complex problems that demand breakthrough solutions, others have not been willing to try. 👊 Clear Passion & Purpose – The drive in these founders is undeniable. They’re committed to their mission with a depth of purpose that shapes every choice. One founder, for example, took two years completely off to learn and meet everyone in longevity biotech. This level of grit and dedication is rare but essential for the most impactful founders. 🌟 Assembling All-Star Teams – They bring together top-tier talent from diverse disciplines: experienced business leaders with successful exits or industry experience at top companies, technical co-founders with deep expertise, often PhDs or industry pioneers, and even published authors. It’s a complementary team, unified by a shared vision. They make the: "Why this team?" obvious - at a glance. 💻 Data-Driven to the Core – These founders present data insights that show why their approach is unique, especially against a competitive field of companies. This data is delivered with clarity and they make the complex simple. Many are published in top journals, adding depth and credibility to their approach, and reinforcing that they know their tech inside out. ⚡️ Memorable, Clear Vision – They don’t just pitch; they make the future feel tangible, with a vision that’s both compelling and concise. If I can relay their pitch in under 30 seconds to my team, they’ve killed it. 📣 Transparent & Proactive Communication – The best founders don’t wait for questions. They come prepared, often with a comprehensive FAQ doc, give timely updates to our questions, and are candid about challenges. This level of openness builds trust and strengthens our partnership. 💸 Milestone-Driven Funding Strategy – Each funding stage aligns clearly with already achieved or upcoming achievable milestones. They’ve mapped out a roadmap that minimizes risk at every step, giving us confidence in their journey. 💰 Revenue Milestones Along the Way – Even if it'll take a decade to hit revenue on their big vision, these founders find revenue generation stops along the way to profitability. They share a trajectory that connects early wins to revenue, showing how every step is a building block toward their bigger vision. Overall, the best founders are incredibly thoughtful, prepared, and fantastic verbal / written communicators. #founders #startups #fundraising #VC

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📈🏢 Aby Rosen's RFR Holding is facing a staggering $2.5B debt bill as defaults pile up! 💥 🔎 According to a recent Bisnow article, RFR Holding, a prominent NYC real estate firm, is grappling with mounting debt and defaults. The company, led by billionaire Aby Rosen, has a portfolio of high-profile properties, including the iconic Seagram Building and Lever House. 🏢🏦 📊 The firm's debt load has surged to a whopping $2.5B, with $1.1B in loans maturing this year alone. 💸 The pandemic has hit the commercial real estate market hard, causing defaults to skyrocket. RFR Holding is no exception, with defaults on several properties, including the $200M mortgage on the Seagram Building. 📉 🗣️ "The pandemic has created a perfect storm for commercial real estate," said one industry expert. "Companies like RFR Holding are facing unprecedented challenges as they navigate this difficult time." 🌪️ 🔜 So, what's next for RFR Holding? The company is reportedly exploring options to refinance its debt and avoid further defaults. 💡 With the commercial real estate market showing signs of recovery, there's hope that RFR Holding can weather this storm. 🌞 Stay tuned for more updates on this developing story! 📰🔔 #RFRHolding #CommercialRealEstate #Debt #Defaults #NYCRealEstate

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Worth reading: Situationsl Awareness by Leopold Aschenbrenner PDF : https://lnkd.in/gkxQ3yMD Web site: https://lnkd.in/gyJUCBhb Interesting perspective, time of course will tell.

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This is a good resource I've stumbled upon. It covers a plethora of VC and startup-related topics and contains links to expand your knowledge. https://lnkd.in/dqkdV4fA TL;DR: "It's the founders, stupid!" These two lines made me hover over: "I know the physical and emotional tolls that entrepreneurs face". "Resources for Managing Founder Anxiety and Depression" I've been one myself, and it's not for the faint-hearted. I struggled and failed many times. From the standpoint of a person working now for a VC fund, the ability to support a founder who was hit with too much at the same time, to know how to listen, mirror and label Chris Voss's style, and a bit of guidance to build confidence back can do wonders. Assisting portfolio companies doesn't have to be just intros and throwing money or unsolicited advice. And what about identifying troublesome founders before investing to prevent assisting portfolio companies from becoming a nightmare flop? Ahh, that's a tricky one. Startups fail for a variety of reasons. At the early stage, we should look at many things, to name a few: product-market fit, go-to-market, blue ocean or zero to one, CAC and LTV ratio, CAP table, passion, leadership potential, intelligence, technical ability, and many, many more. Crunch the numbers. Sure. What about the early stage? Limited information and knowledge when a decision has to be made, and the outcome is impossible to predict because the future is unknown and unknowable. Examine the founders. If you don't read the founders right and overlook some hidden toxic traits and coping mechanisms that mask something that can derail the startup and founders down the road (vulnerable narcissism, antisocial tendencies, Machiavellism, blameshifting or more benign like anxiety-prone, conflict avoidance, burn-out tendency, inability to delegate, perfectionism, risk aversion, etc.), the chances that it will be your next outlier significantly diminish. How many of you saw dead equity on the capable, founders' clash, low morale, a founder playing the sunk cost game with the fund after burning cash, lying, or even more brazen behaviours like experimenting with horse tranquilisers and smoking weed on a podcast? A "Sudden" shift of values with a splash of megalomania could lead to a CEO removal attempt by the board. Or stealing "HER" voice. It is fun to watch as a TV drama, not to deal with as your portfolio. We won't be able to see it all during a few conversations with the founders and not everyone is Wendy Rhoades from Billions. Knowing how to ask a question behind which is a hidden question and being able to detect when founders say what they think we want to hear to get the funding is a good start. Spending extra time learning that is a good investment. A splash of psychology, empathy, self-awareness, and emotional intelligence to become an excellent GP won't harm your ability to identify and help the right entrepreneurs build great companies.

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