Since “Liberation Day,” Ryan Petersen has talked to more than 100 customers on Zoom. Petersen, CEO and founder of supply chain logistics unicorn Flexport, says businesses of all kinds are worried. 

“The most striking thing has been the number of companies that have told me they’re going to go out of business, just fail and go bankrupt,” said Petersen. “I would say 80% of the companies that import just from China, nowhere else, will go bankrupt over the next six months if they don’t do something.”

Key retailers, both online and brick-and-mortar, make up a “huge percentage” of companies in the crosshairs, said Petersen. 

“These are companies that were built over decades or longer, but iconic American brands will fail,” he told Fortune. “Nobody can really believe it.”

Trump’s constantly-shifting tariff plans have been nothing short of seismic. Tariffs are expected to raise consumer prices by more than 2% this year—which translates to an extra $3,800 in annual household spending—and have inconsistently affected everything from smartphones to toys. Petersen has been incredibly vocal about the tariffs on X, as Flexport’s customers are directly impacted. (Retailers of all kinds use Flexport’s platform to order management, freight forwarding, and customs management.)

“Survival isn’t good enough for us, we’ve got to thrive, but it’s a difficult world right now,” he said. “I’m not really worried about Flexport, but I’m worried about our customers. Some of these stories are really sad. We’ve got to get these tariffs turned around so that they don’t die. It’s an own goal.”

Flexport, Petersen says, is in a good position—he estimates that the tariffs push back the company from reaching profitability by six months to a year. Flexport has had its share of ups and downs through the years, facing rapid growth that cycled into layoffs. Petersen himself put plans in place to step aside as CEO in 2022 (taking on an executive chairman role), with former Amazon executive Dave Clark taking the helm—only for Petersen to be back as CEO by Sept. 2023.

Today, the company, Petersen told Fortune, is moving in the right direction now, and “planning to end the year with really strong cash-free cash flow.” Reducing its reliance on China, Flexport has offices in places like Thailand, Taiwan, Singapore, Vietnam, Malaysia, Mexico, and India.

“China used to be a much bigger percentage of our business than it is now,” he said. 

Still, China remains a place where many Flexport customers do much (or all) of their manufacturing. With Trump’s China tariff coming in at a 145% combined rate and China’s 125% tariff response, there’s a standoff that’s playing out in real-time before our eyes. Petersen thinks China has the edge when it comes to waiting this out. 

“I think Trump is as iron-willed as anyone, but the American system has way more feedback loops than the Chinese system,” said Petersen. “They’ve been through much tougher forms of hardship over the last 100 years. Some unemployment? They’ll be fine.”

He continued: “The American people, when faced with unemployment, are used to the Fed bailing us out, printing a whole bunch of money to mitigate the problem. Maybe the Fed will do that, but you can’t print money out of a supply chain crisis.”

Petersen thinks the Trump administration’s trade policies ultimately could net out well over time—the negotiation remains in progress, he notes. He also expressed optimism about where global trade is heading long-term, citing history.

“We’ve got 800 years of history with global trade going up,” said Petersen. “There are a few moments where it went down—World War II, World War I, the Great Financial Crisis of 2008. It went down with the Black Death, but other than that it’s been up and to the right. The Black Death doesn’t show up on the long-term graph—and 30% of the population died. If you play this out, companies will want to do more business globally, not less. The governments may try to rein us in. Then, those governments get voted out of power, because people want to do trade.”

See you tomorrow,

Allie Garfinkle
X: @agarfinks
Email: alexandra.garfinkle@fortune.com
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VENTURE DEALS

- Utilidata, a Providence-based edge AI technology company, raised $60.3 million in Series C funding. Renown Capital Partners led the round and was joined by Quanta, NVIDIA, and existing investor Keyframe Capital.

- Supio, a Seattle-based AI legal solutions provider, raised $60 million in Series B funding. Sapphire Ventures led the round and was joined by Mayfield and Thomson Reuters Ventures.

- Plenful, a San Francisco-based AI-powered healthcare workflow automation platform, raised $50 million in Series B funding. Mitchell Rales and Arena Holdings led the round and were joined by Notable Capital, Bessemer Venture Partners, TQ Ventures, Susa/Kivu Ventures, and clothes.

- Rogo, a New York City-based AI financial analyst developer, raised $50 million in Series B funding. Thrive Capital led the round and was joined by J.P. Morgan Growth Equity Partners, Tiger Global, Positive Sum Ventures, existing investors Khosla Ventures, BoxGroup, AlleyCorp, and others.

- Nuvo, a San Francisco-based B2B trade platform, raised $45 million in funding from Sequoia Capital, Spark Capital, Founders Fund, angel investors, and others.

- Miden, a New York City-based blockchain system, raised $25 million in seed funding. a16z crypto, 1kx, and Hack VC led the round and were joined by Finality Capital Partners, Symbolic Capital, P2 Ventures, angel investors, and others.

- Hoofprint Biome, a Raleigh-based enzymes developer to reduce cows’ methane emissions, raised $15 million in Series A funding. SOSV's Ireland Biomanufacturing Fund led the round and was joined by SOSV Fund V, Amazon’s Climate Pledge Fund, Breakthrough Energy Fellows, Alexandria Venture Investments, and all existing investors.

- Bloom Credit, a New York City-based credit data platform, raised $10.5 million in funding. Crosslink Capital led the round and was joined by CT Innovations and existing investors Allegis Capital and Commerce Ventures.

- Ceto, a Newcastle-Upon-Tyne, England-based maritime insurance company, raised $4.8 million in funding. Dynamo Ventures led the round and was joined by Howden Ventures, Signal Ventures, and Motion Ventures.

- Structify, a New York City-based dataset provider, raised $4.1 million in seed funding. Bain Capital Ventures led the round and was joined by 8VC, Integral Ventures, and angel investors.

- Solda.AI, a Middletown, Del.-based AI voice sales agents developer, raised $4 million in seed funding. Accel led the round and was joined by AltaIR Capital.

- Flash Coffee, a Jakarta-based coffee chain, raised $3 million in funding. TA Ventures led the round and was joined by existing investor White Star Capital.

- AMPLY Discovery, a Belfast-based AI-powered drug discovery technology company, raised $1.8 million in seed funding. Twin Path Ventures led the round and was joined by Venture Science, Co-fund NI, British Business Bank, and QUBIS Limited.

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PRIVATE EQUITY

- Clearlake Capital acquired a majority stake in ModMed, a Boca Raton, Fla.-based AI-powered healthcare technology company. Financial terms were not disclosed.

- HGGC acquired a majority stake in Equity Methods, a Scottsdale-based executive compensation and stock-based compensation solutions provider. Financial terms were not disclosed.

- RX3 Growth Partners acquired a minority stake in Truvani, a Las Vegas-based protein powder and supplement brand. Financial terms were not disclosed.

- SSI Diagnostica, backed by Adelis Equity Partners, acquired Gulf Coast Scientific, an Oldsmar, Fla.-based medical tests company. Financial terms were not disclosed.

OTHER

- Palo Alto Networks agreed to acquire Protect AI, a Seattle-based cybersecurity company for AI and ML systems. Financial terms were not disclosed.

FUNDS + FUNDS OF FUNDS

- Ballast Equity Partners, a Providence-based secondary investment firm, raised $93 million for its first fund focused on venture capital and growth equity opportunities.

PEOPLE

- Brightstar Capital Partners, a New York City-based private equity firm, added Marcelo Claure as partner and co-chair. He is founder and CEO of Claure Group.