5 Supply Chain Startup Ideas According to VCs

A good startup idea may be a 1mm head start but good problems create good business opportunities. Supply chain is bursting with such opportunities, which is why startups raked in $31 billion in funding in 2022, up from $2.0 billion in 2013. This year alone we’ve seen 20 acquisitions totaling $11 billion.

Where are the most lucrative supply chain problems? I asked five investors for their thoughts.

Here are 5 supply chain startup ideas direct from VCs:

1) Vertical Labor Solutions

The industrial sector is facing a massive skilled labor gap. As experienced workers retire, they’re not being replaced fast enough. “There is a huge truck driver shortage, with gaps in the hundreds of thousands,” says Natan Reddy, Principal at 25madison. He’s excited about solutions targeting the need for skilled labor. “This could be a marketplace, or tools for recruitment and retention,” says Natan. The demand spans many areas including truck driving, construction, and manufacturing.

2) Demand Forecasting

Accurate demand forecasting is a notoriously difficult challenge for brands. “Today, forecasting is largely manual, with sales, finance, inventory, and supply chain all trying to reconcile their own siloed spreadsheets,” says Kaitlyn Glancy, Partner at Eclipse and former VP of Flexport. “I’d love to see a predictive analytics tool that makes recommendations for the demand planner.”

3) Load Booking & Operations

In commodity markets like freight, increasing volume is top of mind. Brian Wei, investor at BMW i Ventures, is looking for tools that improve sales and operations of booking logistics loads. “It is valuable if you can increase load value per rep while cutting the cost per load.” This is crucial for the “long tail of freight forwarders, given the market has historically lower margins and high competitive headwinds,” says Brian.

4) Robotics Implementation Management

Robotics are revolutionizing the supply chain from manufacturing to last-mile delivery. “We’re very excited about solutions that streamline the deployment and adoption of robots in manufacturing and warehouses,” says Aditya Raghupathy, investor at Schematic Ventures. Schematic just led a $1.7 million Pre-Seed for Reshape Automation, a company helping manufacturers with automation projects. Robotic automation can slash costs, reduce downtime, and minimize errors across the supply chain, and user-friendly software can add tremendous value.

5) AI-powered Services

While many VCs shy away from services-led businesses, Derrek Li, investor at Dynamo Ventures sees big potential. “Especially in industries with labor demands, customers just want problems solved, ideally without major technical or operational overhauls,” says Derrek. In revenue-pressured sectors where companies are rethinking margins and efficiency, AI-enabled services are booming.

Supply chain is a massive industry with tons of problems yet to be solved. Investors are eager to back companies tackling this enormous market.

Building in Supply Chain Tech? Fundraising? Hiring? Get in touch!

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