Dave Clark has had a rollercoaster of a time over the past two years.
After stepping down as CEO of Amazon's global consumer division in June 2022, a role he held for more than 20 years, Clark relocated to Dallas and joined supply chain logistics company Flexport. Mandated by the board to prepare Flexport for listing, Clark led the company as co-CEO and later served as CEO, with founder Ryan Peterson transitioning to executive chairman.
However, not everything went smoothly. In September 2023, the Flexport board, led by Peterson, accused Clark of poor management and pressured him to resign. Mr Clark insisted he was simply trying to resolve what he considered “broad-based” systemic problems. Subsequent news reports corroborated Clark's claims, but the damage was done. Clark was out.
Mr. Clark considered running for governor of Texas. He also hired strategists. But the appeal of starting a business and being able to run it as he saw fit proved to be stronger.
Clark announced his new company Auger on Tuesday, raising a massive $100 million seed round led by venture capital firm Oak HC/FT. Auger develops AI-powered tools for supply chain-dependent businesses that integrate with existing inventory management platforms to provide real-time insights.
“Throughout my career, I have seen supply chain breakdowns not only impact businesses but actually millions of people. I have seen delays in getting products to the shelves, forced employees to work overtime, etc.” “It's the miscommunication that leads to higher prices, higher consumer prices, and inefficiencies that lead to higher carbon emissions,” Clark told TechCrunch. “These aren't just business problems, these are human problems. And it's time to fix them.”
Clark was vague about what exactly Auger is building, other than to say it will “integrate” supply chain data for different types of aggregation. There also appears to be a chatbot component. According to Clark, users can “simply ask” a question such as “Please give me inventory information for next week's shipment,” and Auger will provide that data “instantly” at the “consumer level.” That's what it means. Portal.
“Despite significant investments, businesses still rely on fragmented 'Frankensoftware' – disparate systems stitched together with incompatible technologies that cannot communicate effectively,” Clark said. said. “This leads to inefficient workarounds and forces us to use tools like Excel to make critical decisions, but these tools are not designed to handle the complexity of a supply chain of this scale. Auger is developing new solutions for businesses that want better options.
Clark points out that there is strong demand for technology that helps organizations understand their supply chains. According to one source, 56% of retailers carry several weeks' worth of “safety stock” as insurance against reduced supply chain visibility.
Lack of supply chain awareness, coupled with increasing supply chain headwinds, from dockers' strikes to Red Sea disruptions, is contributing to major disruptions to global shipping. Roughly one-third of service businesses and nearly half of manufacturing businesses are having trouble getting supplies, according to a New York Fed survey.
“Increasing chaos and global conflict [are] “Nearly constant changes to manufacturing and the flow of goods around the world are stretching existing technologies beyond their limits,” Clark said.
Recent roadblocks, combined with the challenges posed by the pandemic, have led to an explosion in the number of startups working on supply chain visibility and management. According to Markets and Markets, the logistics software sector is expected to reach $46.5 billion by 2025. And there is a healthy flow of capital into emerging supply chain platform vendors, with startups in the space receiving $15.4 billion in investment this year.
Indeed, Bellevue, Wash.-based Auger is entering a market crowded with formidable competitors.
Altana, which raised $200 million from investors in July, uses AI systems to create a shared view of international supply chain networks from both logistics and B2B data. Everstream and Pando offer unique analytical dashboards intended to complement transportation management and supplier relationship management systems.
Clark insists that what Auger creates will be truly different.
“Auger integrates data from multiple sources and uses advanced AI and machine learning to generate automated, dynamic insights in real-time,” Clark said. “This platform provides a single pane of glass across planning, forecasting and financing. [to] …Empower your team to move beyond manual tasks and focus on driving innovation. ”
Clark may have what it takes to take on big vendors in the SaaS supply chain software space. After all, logistics is his specialty. At Amazon, Clark was an early advocate of robotic automation, which has saved the company tens of millions of dollars. And during the pandemic, Clark dramatically expanded Amazon's business to meet growing demand for online goods.
On the other hand, Mr. Clark made a major management mistake. He misjudged Amazon's acceptance of brick-and-mortar business and overexpanded the company's warehouse capacity during the final stages of the pandemic. The latter decision led to billions of dollars in cost overruns.
Matt Streisfeld, Oak's general partner, believes in Clark, calling him a “once in a lifetime” founder with the potential to “reimagine supply chain management software.” I'm here.
“We are in the midst of significant change, with more data moving to the cloud every day,” Streisfeld said in a statement. “This transition will make structured information more accessible for real-time and continuous planning, layered with AI to automate more workflows, and enable more business for inventory management and forecasting. and financial insights.”
Clark said Auger does not yet have customers or revenues, but plans to release more information about its product roadmap and milestones in the coming months. “Our founding team is comprised of tireless problem solvers with a proven track record of delivering innovative supply chain solutions at scale,” he added. “This is just the beginning.”