Terminal Industries departs stealth mode with $17M for AI yard operations

July 22, 2023

Business

Terminal Industries departs stealth mode with $17M for AI yard operations

[ad_1]

Significant attention has been given to advancing warehouse management systems (WMS) in the FreightTech landscape, revolutionizing operations within physical buildings for enhanced transparency and optimization.

However, yard management systems (YMS) have received less investment, and their innovations have been relatively dormant compared to WMS. YMS has traditionally relied on manual processes with limited technological support.

To confront this challenge, Austin, Texas-based Terminal Industries came out of stealth mode on Thursday, along with profound partners, to strategically optimize yard operations globally utilizing its unique artificial intelligence (AI) capabilities.

The company announced it has closed $17 million in seed funding, led by supply chain investor 8VC and global warehouse provider Prologis, with participation from strategic investors including Ryder Ventures, NFI Ventures, Lineage Logistics, Vehicle Velocity Group and the Friedkin Group.

Bringing AI to a yard near you

According to Terminal Industries, 92% of yards lack technology solutions to eliminate wasted capacity, drive down unforeseen costs and improve inventory operations, leading to $146 billion in excess transportation costs.

For this reason, CEO Max Constant and chief technology officer Neil Robertson, a former professor at Queen’s University Belfast, teamed up with 8VC and Prologis to utilize the duo’s AI expertise to digitize the yard.

Constant explained in an interview with FreightWaves that the company leverages a specific type of AI — computer vision — to obtain yard operations data that has been traditionally difficult to obtain.

Constant explained why there was no better AI than computer vision to solve the problems that cameras are picking up.

“There is a lot of camera data that is aggregating across these yards that nobody knows how to utilize,” he said. “… We can index and analyze all of this information passively and then you can turn around and use that information for a whole variety of reasons.”

These use cases could include yard process improvement, detention, idling and demurrage expense reduction, capacity visibility and on-time performance metrics to name a few.

While fixing these problems could bring down substantial industry costs, Constant also noted that recent regulatory requirements and proposals could elevate this technology to a fundamental necessity for warehouse operators.

He pointed to regulations like the Warehouse Indirect Source Rule, which aims to reduce nitrogen oxides and diesel particulate emissions connected to warehouse operations in Southern California, or the Securities and Exchange Commission’s proposed climate disclosure rules.

People, ideas and partnerships

While clarifying the potential impact of Terminal Industries’ solutions on the logistics sector, Constant finds particular excitement in spearheading the adoption of its solution alongside industry partners who possess a genuine appreciation for the issues they address.

In an interview with FreightWaves, Jake Medwell, co-founder and partner of 8VC, expounded upon the alignment between Constant’s sentiment and Terminal Industries’ potential profound influence on the global economy, deeming it a catalyst for investment.

“[8VC] builds companies around people, ideas and partnerships,” he said. “Terminal was founded on all three of these pillars. We know Prologis, Ryder and NFI incredibly well. Each one of them cares about technology and long-term commitments to efficiency. They’re also all vertically integrated. We could not ask for better co-development partners for Terminal.”

Funding details:	Terminal Industries
Funding amount	$17 million
Funding round	Seed round
Lead investors	8VC and Prologis
Secondary investors	Ryder Ventures, NFI Ventures, Lineage Logistics, Vehicle Velocity Group, and the Friedkin Group
Business goals for the round	Continue developing its AI technology and product offering
Total funding	$17 million

“Yard management is essential to improving efficiencies at warehouses, yet there has not been a platform to fully digitize yard operations — until Terminal,” said Will O’Donnell, managing director of Prologis Ventures, in the release. “We know customers are seeking technology that would give them real-time data insights on the intersection between transportation and warehouse operations. Terminal’s AI solution is a significant leap forward.”

Outside of the founding members and seed round investors, the team packs a punch with its advising team, including Chris Sultemeier, former executive vice president of Walmart; Alan Gershenhorn, former executive vice president and chief commercial officer of UPS; Shaleen Devgun, executive vice president and chief technology officer of Schneider; and FreightWaves founder and CEO Craig Fuller.

Matt Yearling, former CEO of yard management and visibility provider PINC, will also join the team as Terminal Industries president.

“We are the AI experts and they are the transportation experts, and I think the convergence of those two disciples can be very powerful,” Constant said. “It is our job now as innovators, with these partners, to construct a roadmap to help adopt and integrate these technologies into the industry. … We are talking about restructuring 100-year-old processes, and it’s exciting to sit at this inflection point.”