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.
I had a chance to moderate a panel on electric vehicles at the International Automotive Remarketers Alliance conference last week in San Antonio, and I was surprised at the amount of uncertainty there is around EVs and how the industry is going to remarket used EVs as they hit the market. But we’ll get to more on that a bit later.
For now, private-equity firms have been stocking up dry powder, as their investors continue to pour money into the asset class in search of yield in a flat-interest-rate environment.
Private Equity and Venture Capital firms are now holding $2.29 trillion dollars in undeployed capital. This is a significant increase from December, when the worldwide total was just under $2 trillion dollars; and December 2019, when the figure was just $1.63 trillion dollars.
All of that money is going to have to find a home at some point. PE and VC funds have zero incentive to sit on the sidelines, which should mean a very active M&A environment over the remainder of this year.
The insurance tech space is very hot, and this week we got news that Goldman Sachs is backing startup DealerPolicy in a funding round that raised $110 million dollars for the company. DealerPolicy provides auto dealers with insurance quotes for their customers.
The financing included existing investors such as 3L CAPITAL PARTNERS and Hudson Structured Capital Management.
The latest round gives the company a valuation of more than $500 million dollars.
Spiers New Technologies
Cox Automotive Mobility has acquired Spiers New Technologies, a service provider for electric vehicle battery lifecycle management with operations in the U.S. and Europe.
Spiers provides repair, remanufacturing, refurbishing and repurposing of advanced battery packs in hybrids and EVs, and gives Cox Automotive muscle in terms of diagnosing EV battery health and managing the lifecycle of those EV batteries.
Roughly 18 months ago, SNT and Cox Automotive Mobility started building a third-party battery health diagnostic tool, powered by SNT’s “ALFRED” battery decisioning platform, that assesses an EV battery’s condition and value.
The company likened such EV battery health scoring to the work that its sister company Kelley Blue Book has done in the vehicle valuation space.
Parent company Cox Automotive is providing EV health reports as part of condition reports at select Manheim auctions.
EV automaker Rivian has filed confidential paperwork with the SEC for an IPO.
Rivian is seeking a valuation of roughly $80 billion dollars, and eyeing an IPO around Thanksgiving. A valuation of $80 billion would make Rivian worth more than Ford Motor Company and General Motors.
The company was founded in 2009 and has raised $10.5 billion dollars since 2019 amid increased interest in electric vehicles.
Rivian received an order for 100,000 delivery vans from Amazon, some of which are making deliveries in the US already.
Upstream Security, the leader in automotive cybersecurity and data analytics for connected vehicles, has closed a $62 million dollar series C funding, led by Mitsui Sumitomo Insurance, and joined by new investors I.D.I. Insurance, 57 Stars’ NextGen Mobility Fund, and La Maison Partners. Upstream’s existing investors include Glilot Capital Partners, Salesforce Ventures, Volvo Group Venture Capital, Nationwide, Delek US Holdings, and others.
Upstream provides a cloud-based cybersecurity and data analytics platform which taps the mounts of data stored in connected vehicles and combines it with purpose-built artificial intelligence and machine learning technologies to empower its customers to improve business results by offering advanced security capabilities as well as data analytics actionable insights.
HAAS Alert, a SaaS company that provides real-time automotive collision prevention for public safety and roadway fleets, has raised $5 million in seed funding that it will use to scale sales and outreach efforts and prioritize R&D with vehicle-to-vehicle and vehicle-to-infrastructure technology partnerships.
The round was led by R^2 and Blu Ventures and joined by TechNexus Venture Collaborative, Stacked Capital, Urban Us, Techstars, Ride Ventures and The Gramercy Fund.
Gatik has raised $85 million in a Series B round led by new investor Koch Disruptive Technologies, the venture arm of Koch Industries. Existing investors Innovation Endeavors, Wittington Ventures, FM Capital, Dynamo Ventures, Trucks Venture Capital, Intact Ventures and others.
Gatik has raised $114.5 million to date.
In the two years since Gatik AI came out of stealth, the autonomous vehicle startup has launched pilots with Walmart and Canadian retail giant Loblaw Companies in its bid to prove that self-driving technology combined with box trucks is the secret economic sauce for hauling goods short distances.
Vehicle trading platform TRADE X said Monday it has completed a financing round announced in late July, bringing in additional equity funding of $10 million dollars.
Leading the additional equity funding are new investors that include EchoVC Partners, Frontier Ventures and Upgrowth.
TRADE X provides a global, B2B vehicle marketplace designed to take care of the complexities of cross-border transactions for buyers and sellers, and said it will use the capital for acquisitions and to expand throughout North America, Europe, Asia, Africa and the Middle East.
Foretellix has raised $32 million dollars in its Series B funding round. MoreTech Ventures led the funding round, though the amount was undisclosed. Other investors included Volvo Group and Nationwide Insurance, 83NORTH, Jump Capital, OurCrowd and Next Gear Ventures.
Foretellix, founded in 2017, has received approximately $50 million in investments to date.
Foretellix’s simulation platform allows customers to replicate driving scenarios with thousands of variations that would otherwise be impossible or laborious to collect.
Ideanomics, a fintech and electric mobility firm based in New York, has added to its list of acquisitions commercial electric vehicle manufacturer VIA Motors — in an all-stock deal valued at $450 million dollars.
Ideanomics has been aggressively purchasing mobility businesses this year, as it seeks to build out vertically integrated offerings for fleet operators and transit authorities transitioning to electric vehicles.
The acquisition of Via Motors is by far the largest in Ideanomics’ history. Via designs and manufacturers electric vans and trucks for short- and middle-mile delivery, using a modular, “skateboard” style architecture across three vehicle models.
In international news this week, GEELY’s premium electric car brand ZEEKR has raised a total of $500 million dollars from Intel Capital, CATL, bilibili Group, the Cathay Fortune Group and Boyu Capital.
Zeekr was founded in March and plans to launch one new model in each of the next five years. The electric cars will be built on the Sustainable Experience Architecture electric platform unveiled in September 2020. Initially, Geely is targeting the Chinese market with Zeekr, but later the electric cars could also be exported – as the company wants to “serve the growing global demand for premium electric vehicles”.
Xiaomi Technology has acquired Chinese autonomous driving startup DeepMotion.ai for $77 million dollars.
With the move, Xiaomi is poised to become a competitor to other autonomous driving and electric car companies, including Tesla and Waymo in the U.S. and Baidu in China.
The news follows Xiaomi’s announcement in March that it will invest $10 billion dollars over the next 10 years into its upcoming electric vehicle business.
In July, Xiaomi overtook Apple to become the number two smartphone vendor globally.
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, our companies to watch are Recurrent and Moment Energy.
First up this week is Recurrent.
By providing more transparency and confidence in pre-owned electric car transactions, Recurrent accelerates the overall adoption of electric vehicles. Which will be key to reducing the 20% of U.S. carbon emissions that are currently produced by light-duty combustion engine vehicles.
As I mentioned earlier, there is a lot of uncertainty about the condition of the battery for used EVs, and Cox Automotive just made an acquisition in this area.
Recurrent is positioned to help buyers of used EVs have confidence in the remaining life of the car’s battery. This is going to become more and more important as used EVs become more prevalent, and newer EVs come out with better battery technology.
Our second company to watch this week is Moment Energy.
Moment Energy recycles used EV batteries at end-of-life to create sustainable energy storage systems to increase energy reliability in off-grid areas.
With supply relationships with OEMs including Nissan, the solution is created using second life electric vehicle (EV) batteries to provide a reliable, environmentally friendly, and price-competitive offering.
When it comes time to scrap an electric vehicle at end-of-life, we will need to figure out what to do with the battery. Moment Energy is working on a solution to reclaim used EV batteries and repurpose them.
So that’s your weekly Friday 5, a quick wrap-up of the big deals in automotive technology over the past week.
It’s an exciting time to be in the automotive space, with a ton of deals going on. Make sure you stay tuned in each week to stay up to date on the auto industry’s technology M&A activity. I’ll keep my fingers on the pulse of deals being done, so I can share updates with you.
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