Optimal Dynamics (Princeton), a startup that was spun off from Princeton University, recently secured $4 million in seed funding.
The round was led by Fusion Fund (Palo Alto, Calif.), with participation from The Westly Group (Menlo Park, Calif.), TenOneTen Ventures (Los Angeles), Embark Ventures (Santa Monica, Calif.), Fitz Gate Ventures (Princeton) and Newark Venture Partners.
The cofounders are Daniel Powell, CEO, and his father, Warren Powell, artificial intelligence (AI) expert and Princeton University professor of operations research and financial engineering. Their startup applies AI to logistics, and its mission is, in part, to “be the decision layer of logistics in order to help companies automate and optimize their operations.” Optimal Dynamics employs about 11 people full time and has customers and revenue.
The company is transitioning the logistics industry from real-time human decision-making to advanced automated decision-making at every level. The software, called “CORE.ai,” enables logistics companies to automate everything from high-level strategic questions such as how many drivers they need or what equipment they should buy to daily dispatching and load-acceptance issues, according to a release.
The software also allows companies to plan significantly farther into the future, as it can learn and plan for uncertainty, unlike previous systems that had to assume a perfect future. This enables companies to perform strategic, tactical and real-time planning, all with the same technology, creating a seamless interface throughout the planning process, the startup said.
NJTechWeekly.com recently interviewed Daniel Powell about the company and its successful funding round.
CORE.ai is built on the concept of high-dimensional artificial intelligence, as opposed to neural networks, where AI algorithms are trained based on known outcomes, Powell said. “Problems in logistics have multiple layers, attributes, complexity and uncertainty that you deal with.” This is AI that is custom built from the ground up, he added, noting that “CORE.ai allows companies to capture significantly more detail, plan into the future and, most importantly, plan for uncertainty.”
Core.ai is based on work that Warren Powell has done at Princeton University on the novel use of “approximate dynamic programming developed specifically for freight transportation.” Warren has been a professor there for 39 years, his son said, and has developed a whole suite of technologies for the logistics industry.
Much of the work was done at Princeton’s CASTLE Labs. As Warren had noted earlier, “CASTLE gave me a unique setting for working directly with industry, allowing me to see first-hand what the problems were, what worked and what didn’t. I often learned by watching people solve problems, and then turned this into mathematics. Of course, computers ‘think’ differently from humans, and it was necessary to exploit the power of modern optimization algorithms, but these were only well suited to solving deterministic problems. I had to combine optimization tools with machine learning and simulation.”
The idea behind Optimal Dynamics was to effectively productize this AI. Some of these codes have been used in the real world, but they have not been productized, Daniel said. “We could drive real efficiencies and automation through deploying this in a productized way. The trucking industry is a logical first step. … It’s an incredibly large industry. It is a very manual industry and it’s lagging in technology. And, so, it’s a pretty greenfield opportunity to start gaining some traction and spread that way.”
Even for a startup with as fine a pedigree as Optimal Dynamics, raising funds during the pandemic was no piece of cake. The Powells had some sleepless nights, but the company’s concept was well received, and the founders wound up closing a $4 million round. “It turned out to be a really good round, and we were oversubscribed,” Daniel added. He noted that the bulk of the deal was closed digitally.
He then explained that the startup plans to use the funds from its seed round to begin a formal sales effort and improve its product. The goal is to achieve wider rollout of CORE.ai and to demonstrate that the product can be scaled. Optimal Dynamics hopes to receive a significant Series A investment soon after these milestones are reached.