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.
Well, another week, and another few SPACs up on the board. Let the good times roll.
First off, we saw quite a nice reception from stock market investors for the newest EV manufacturer going public. The market valued electric vehicle maker Lucid Motors at $62 billion dollars on Tuesday after a deal to merge with blank check firm Churchill Capital Company IV, sparking some concerns about the real worth of the company which has yet to start regular production.
In comparison, General Motors was worth about $72.5 billion at midday Tuesday.
Lucid’s first electric car, the luxury Air, won’t go into production until late 2021, later than the spring 2021 launch initially planned. Officials on Tuesday said they do not expect Lucid to be cash-flow positive until 2025.
While Lucid’s market cap started the week strong, that balloon deflated a bit as the week wound down.
Next up on the SPAC freight train is Xos Trucks, a maker of electric commercial vehicles, that agreed to go public through a merger with a SPAC NextGen Acquisition Corporation. The deal values the combined equity at $2 billion dollars.
To support the transaction, the special purpose acquisition company will raise $220 million from investors including Janus Henderson Group and a group of truck dealers led by Thompson Truck Centers.
Some of Xos’ customers include UPS, armored car service company Loomis and transportation company Lonestar.
And to round out the SPAC hat-trick this week, AEye, a lidar startup that developed its technology for use in autonomous vehicles as well as to support advanced driver assistance systems in passenger cars, is going public through a merger with SPAC CF Finance Acquisition Corp III that will value the company at $2 billion.
Under this deal, AEye said it was able to raise $225 million in a private investment into public equity, or PIPE, from institutional and strategic investors that include GM Ventures, Subaru, Intel Capital, HELLA Ventures, and Taiwania Capital.
Ok, enough of the SPACs for the time being.
In other news, Cazoo, the Carvana of the UK, is weighing plans for an initial public offering in London as soon as this year that may value the company at $7 billion dollars.
The U.K. firm is reviewing the merits of an IPO this year after the successful listing of German online used-car dealer AUTO1 Group, which surged in trading after raising 1.8 billion euros (or $2.2 billion USD) earlier this month.
No surprise that Cazoo has also attracted takeover interest from special purpose acquisition companies (SPACs). The conversion of online car shopping sites and SPACs is like crossing the streams in Ghostbusters.
Recogni, a startup developing artificial intelligence hardware for autonomous vehicles, announced that it has closed a $48.9 million dollar funding round led by WRVI Capital, who was joined in the round by Mayfield Fund, Toyota Motor Corporation, BMW Group and others.
California-based Recogni is developing an AI inference module that can be installed inside a vehicle to run its autonomous driving software. The module is based on a custom application-specific integrated circuit designed by the startup’s engineers.
Tony Rimas and the AsTech team were on fire this week, announcing both a funding round as well as an acquisition.
First up, asTech, known for its patented asTech device and remote scanning, programing, and calibration services to the automotive aftermarket industry, announced a strategic investment from $3M.
Second, AsTech announced the acquisition of adasThink, a company that retrieves information related to the vehicle-specific advanced driver-assistance systems and identifies required ADAS procedures and calibration based on labor operations in an automotive repair estimate.
The adasThink technology leverages the vehicle identification number to properly identify the vehicle’s build information. Within the information, the technology identifies the advance driver-assistance systems on the vehicle that have been impacted by the vehicle’s damage. Additionally, this technology identifies OEM calibration requirements and instructions.
The Company represents the tenth add-on acquisition for asTech and Private Equity sponsor Kinderhook’s 101st automotive-related transaction.
Finally, car buying site gettacar raised a $25 million dollar round of funding, bringing its fundraising total to $48 million through three rounds over approximately two years.
This latest round was led by 3L and Luxor Capital, Torch Capital also participated in the round.
Based in Philadelphia, gettacar counts as differentiators the ability for customers to complete the purchase of a vehicle online in as little as 12 minutes, receive real-time finance options, a 365 day warranty, at-home test drives and the option of returning the vehicle in seven days if they’re dissatisfied with it.
Congratulations to Yossi Levi and the gettacar team!
Companies to Watch
Every week we highlight interesting companies in the automotive technology space to keep an eye on. If you read my monthly industry intel report, 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 companies to watch, Car Capital Technologies and Fuse AutoTech.
Our first company to watch, Car Capital Technologies that was founded to provide dealers with capital AND advanced technology to help ALL consumers buy the cars they need.
With 100% automated instant approvals available to their dealer partners, Car Capital makes it possible for any driver regardless of credit history to feel confident in the ability to purchase a vehicle when entering the dealership.
Every dealer partner has access to the Car Capital proprietary web-based platform, Dealer Electronic Auto Loan System (or DEALS). DEALS provides the tools for Car Capital’s dealer partners to do what they do best, sell cars. Their program allows their network of dealers to make their own approval decisions based on the economics of each unique car and consumer.
If you’re a dealer looking to offer automated instant approvals to 100% of your customers, regardless of credit history, check out Car Capital.
Our second company to watch this week is Fuse AutoTech, a finance management system that consolidates online and in-store technologies for a seamless customer experience from start to finish.
FUSE Autotech provides one, go-to application that streamlines vehicle transactions, reduces cost to sell, maximizes profits and ensures sustainability.
Their easy to use, replicable process allows salespeople to create and close a deal from start to finish. FUSE Autotech lets your dealer team shine with fast, easy, straightforward vehicle transactions that customers love.
FUSE Autotech’s proprietary software combines artificial intelligence, technology integration and process automation to streamline vehicle transactions. Shoppers are asking for a smarter, faster way to buy a car; FUSE Autotech is the answer.
With FUSE, dealerships are able to close more deals by empowering their entire sales force to take a customer through a complete transaction, from start to finish