Where does the Porsche IPO plan stand? Which AI vehicle software company raised $63 M?

Welcome to this episode 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.

VW Group & Porsche

First up this week, it’s looking more and more probable that we’re going to see Volkswagen Group spin off the Porsche brand into its own stand-alone public company before the end of the year. 

The IPO, expected to be one of Germany’s biggest-ever listings, could value Porsche at as much as 90 billion euros, or $91.5 billion US dollars.

Volkswagen has so far stuck to its timeline of a fourth-quarter listing for Porsche, even as difficult market conditions cause other stock offerings to be postponed.

If you recall, Ferrari was IPO’d back in October of 2015 to much fanfare as it was spun off from FCA. Ferrari went public at a $9 billion market cap and is currently valued at $36 billion dollars. 

As a comparison, former Ferrari parent Stellantis’ market cap is just a smidge higher at $37 billion dollars. 

In hindsight, given the recent turmoil in the public markets, a Porsche offering should have happened last year.

Having said that, I’ll be keeping a close eye on how this story plays out over the remainder of the year.

Aurora Labs

Next up, AI vehicle software company Aurora Labs has completed a $63 million dollar Series C financing round, which included Porsche as a strategic investor. This latest round brings the total amount raised by Aurora Labs to $100 million.

Aurora Labs, founded in 2016, provides AI-based vehicle software intelligence that enables vehicle manufacturers, Tier-1 suppliers, silicon vendors, and enterprises to develop, certify and diagnose software, and conduct over-the-air updates. 

The solution also keeps vehicle software safe and secure from faults and cybersecurity attacks, while allowing manufacturers to continuously add new features and functions extending the life of the device and enhancing user experiences.

As I’ve noted in the past, innovation in Over the Air technology is coming fast to dealers, who need to stay on top of developments and innovation in the space.

For one, expect that a lot of recall work, typically done at Franchised dealerships, will be able to be pushed directly to consumer cars via wifi connections. This means fewer visits to dealerships for warranty work, and some industry sources say that in-dealership recall work may be reduced by one-third.

In addition, many automakers have announced that a whole new wave of subscription services will be coming to car owners. Think about unlocking heated seats, enhanced headlights, unlocking additional horsepower, or improved vehicle driving dynamics, all upsold as monthly services. 

Many of these new enhanced features will be pushed, via software updates, to the consumer’s car long after the dealer was the initial point of sale. Over the Air update technology, embedded within the new wave of connected cars, will enable this type of feature to be unlocked. 

It’s still to be determined how subscription revenue for these new services will be shared between OEM and dealership.

I’ll continue to keep my eyes out for new developments in the Over the Air and subscription service space.

If you have specific thoughts on this question, please shoot me a note at steve@automotiveventures.com. I’d love to discuss it with you.

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 have two companies to watch: LoopMeIn and Preteckt.

LoopMeIn

LoopMeIn claims to be the industry’s only complete preowned life cycle management software. 

They have over 75 years of combined industry knowledge from nearly every aspect of dealership life which led the company to create an application to make everyone’s life in the dealership easier, more efficient, and more reliable. 

The company focuses on reconditioning management, vendor management, embedded communication tools, vehicle inspections, and centralized invoicing, connecting everything together in one application. 

The reason that I love LoopMeIn is that most of the innovation over the past 20 years has been on the variable side of dealership operations. It’s great to see new and innovative companies focused on one of the dealer’s largest profit centers, Fixed Operations.

You can check out LoopMeIn at www.LoopMeIn.app.

Preteckt

Preteckt is an AI and IoT company focused on maintenance to increase vehicle availability, improve safety, reduce costs, support maintenance staff, and enable the future of work. It allows technicians to identify and get to root causes 40% faster. 

Preteckt develops next-generation sustainable fuel vehicle technology and helps service providers transition from legacy to green technologies.

Maintenance, maintainers, and digital workflow is their initial focus area. 

The reason I love Preteckt is that with all of the data now being captured from connected cars, it’s exciting to see an emerging wave of companies focused on harnessing all of that data into intelligence around predicting when key components might fail and predicting service opportunities. 

You can check out Preteckt at www.Preteckt.com.

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So that’s your weekly Friday 5, a quick wrap-up of the big deals in the automotive technology space over the past week.

If you’re an early-stage automotive technology entrepreneur looking to raise money, or an entrepreneur who is trying to decide whether and when they should raise money or sell their business, I’d love to speak with you.

Thank you for tuning into CBT News for this week’s Friday Five, and we’ll see you next week!