Welcome to another edition of The Friday 5 with Steve Greenfield, Founder and CEO of Automotive Ventures, an auto technology advisory firm that helps entrepreneurs raise money and maximize the value of their companies.
It’s Thanksgiving week, and as a result, acquisition and investment deal flow has been a little slow. Despite a slow holiday week, I’m hearing that we may see some big deals happen before the end of the year.
As we’ve discussed before on the show, the auto industry has done incredibly well through the Covid pandemic.
Industry executives have found that stocking fewer cars, amid high demand, has lifted profits for automakers and dealers alike. The result has been a seller’s market, with car companies able to hold the line on discounts, driving prices to record highs.
Now, both dealers and OEMs are talking about carrying fewer vehicles on the dealerships’ lots permanently, in what would mark a monumental shift in the way cars are sold in the U.S.
In addition, because of the inventory crunch, car companies have been giving priority to their most popular models and feature combinations, which has reduced complexity and cut supply-chain costs.
It’s been said before that one shouldn’t waste a crisis, and with OEMs being smarter around new car production, and dealers being smarter around their cost structures, we may very well come out of the pandemic with a far stronger and healthier automotive industry.
A Friday Five wouldn’t be complete without another electric vehicle manufacturer going public via a special purpose acquisition corporation or SPAC.
Electric Last Mile Solutions
Electric Last Mile Solutions, an electric vehicle startup focused on electric delivery vans, is in talks to go public through a merger with SPAC Forum Merger III Corporation. A $250 million dollar reverse merger with Forum could value the company at over $1 billion dollars based on previous EV SPAC deals.
The Electric Vehicle space has been very active this year, and competition continues to heat up.
Startup Ride Vision
Startup Ride Vision, the developer of collision-aversion technology for motorcycles, raised $7 million in Series A funding led by OurCrowd.
Ride Vision was founded in 2018 in Israel, and has developed an AI-driven, safety-alert system technology to prevent motorcycle collisions on the road, using standard cameras as visual sensors.
The hardware includes two wide-angle cameras mounted on both the front and rear of the vehicle, unique alert indicators placed on the mirrors, and an onboard main computing unit that stores the startup’s patented algorithms.
The company says its patented human-machine warning interface and predictive vision algorithms help riders make critical life-saving decisions in real time.
Gatik, a startup developing an autonomous vehicle stack for B2B short-haul logistics, today closed a $25 million dollar series A round.
The company also announced it will bring a fleet of self-driving vans to Canada as part of a deal with Loblaw Companies Limited, the country’s largest retailer with over 200,000 employees.
Lunewave, the Arizona-based startup developing a novel technology for radars for autonomous vehicles, has raised $7 million dollars in financing as it gets ready for the commercial rollout of its systems.
The company’s latest financing came from Proeza Ventures, Blue 9 Capital, Tsingyuan Ventures, and Intact Ventures.
With the latest funding, Lunewave will continue to work with Tier 1 suppliers to establish strategic partnerships and jointly manufacture the company’s radar sensor.
Sense Photonics, a developer of technology for use in autonomous vehicles, has added another $6 million dollars in funding to a round launched two years ago.
Since April, and despite a pandemic, the company has hired a former Google executive as its CEO; grown its headcount from around 15 to 70 employees, and raised its funding totals from investors to more than $32 million dollars.
What helps Sense Photonics stand out from other lidar companies is that its technology is solid state and has no moving parts. They believe that competing lidar technologies, involving a spinning light emitter and receiver, is more likely to wear out, especially as vehicles experience vibration from potholes and wind.
Sense Photonic’s emitters don’t move, which allows them to be more subtly integrated into windshields and headlights.
Sense believes that for the next few years, the automotive industry will use lidar to improve assisted driving rather than to create fully autonomous vehicles.
The McConkey Auction Group announced the acquisition of ABS Auto Auctions. ABS has 10 auctions throughout the West, including locations in California, Nevada, Oregon and Arizona.
Back in August of this year, The McConkey Auction Group, headquartered in Spokane, Washington, announced Tuesday that it has added Dealers Auto Auction of Las Vegas to its group.
The wholesale auction space has been very active this year, including KAR Global’s $525 million dollar acquisition of online dealer-to-dealer platform BackLot Cars.
We’re eagerly awaiting to hear more about rumors of ACV Auctions’ upcoming public offering.
The online used car sale space has been hot this year, particularly buoyed by Carvana’s traction in the market, and matching $40 billion dollar market cap.
Ford Motor Company announced this week that they will launch a new online used-vehicle platform and brand early next year called Ford Blue Advantage that will link all 3,100 Ford dealers’ used inventory and feature guaranteed pricing and delivery.
This sounds a lot like Ford powering their own third-party marketplace to compete for consumer attention with other players in the market, including Autotrader, Cars.com, CarGurus and Carvana?
Online vehicle marketplaces owned and operated by OEMs haven’t had a lot of luck in the past, but this new initiative from Ford will be one for us to watch.
We continue to highlight interesting companies in the automotive technology space to keep an eye on. If you read my monthly newsletter, I showcase a few companies each month, and we take the opportunity here on the Friday Five to share some of those companies each week with you.
Today, we’ll look at two very interesting automotive technology companies Reviver Auto, and DigniFi.
Our first company to watch, Reviver Auto, was founded in 2009 in Granite Bay, California, by Neville Boston.
Reviver Auto is the creator of the world’s first connected licenses plates. Their mission is to bring new and far-reaching efficiencies, revolutionary marketing, and unprecedented connectivity to the auto industry through disruptive technology.
With its R-Plate product, the company has reinvented the 125-year-old stamped metal license plate into a connected car platform that digitizes and automates the costly, often frustrating and time-consuming DMV renewal process. Approved by multiple DMVs and DOTs, the R-Plate also provides telematics functionality and brings a new level of personalization to existing license plates.
The company’s digitization of the vehicle registration renewal process is a game changer for Motor Vehicle Administrators with dramatic cost benefits.
Our second company to watch is, DigniFi, founded in 2012 and located in Bellevue, Washington.
DigniFi aims to get consumers a car repair loan that’s easy, flexible, and affordable.
DigniFi works with vehicle repair shops to help consumers easily finance and take the worry out of paying for car repairs.
The consumer can proceed with their needed vehicle repair, and pay over time. The consumer pays no money down, and doesn’t pay any interest if they pay off their loan in the first 90 days. DigniFi is a great alternative to the consumer racking up a credit card bills with prohibitive interest rates.
Approved applicants may also qualify for other smart products designed to make life a little easier and safer, like Roadside Assistance and a Vehicle Protection Plan.
In July, DigniFi announced they raised $14 million dollars in Series A funding from BuildGroup and Exor Seeds, the venture arm of Exor N.V., which is the holding company of the Agnelli family, the controlling shareholders of Fiat Chrysler.
DigniFi also signed an agreement with Neuberger Berman Private Equity to buy $275 million dollars in assets, which will allow it to grow its network of 5,000 auto service centers.
It’s an exciting time to be in the automotive space. Make sure you stay tuned in each week to stay up to date on the auto industry’s technology M&A activity.
Did you miss last week’s episode of The Friday 5? Watch it here now! And don’t forget to share your questions and comments with Jim Fitzpatrick at email@example.com.
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