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.
The Electric Vehicle SPAC and IPO market continue to be very hot and we’ve had a number hit the public markets this past week.
We have discussed here on the Friday 5 that we’re seeing the blurring of lines between the traditional wholesale and retail parts of the auto industry.
This week we have yet another example that supports that we’re seeing the auto evolution of the traditional marketplace evolve in real-time.
AutoWeb has acquired the assets of CarZeus, a Texas-based used vehicle acquisition platform that purchases vehicles directly from consumers and resells them through wholesale channels.
AutoWeb intends to expand its used vehicle acquisition offering beyond CarZeus’ current San Antonio market by leveraging AutoWeb’s significant traffic acquisition capability and the management team’s depth of relevant experience.
This acquisition positions AutoWeb to participate more meaningfully in the consumer used vehicle disposal market, which is highly fragmented and very large. Industry estimates size that market to include approximately 25 million vehicles annually with a total estimated value of approximately $230 billion dollars.
The acquisition of CarZeus also supports AutoWeb’s ongoing product investment strategy to provide increasingly useful consumer experiences through its portfolio of automotive brands, including Car.com and UsedCars.com. This blended online and offline approach is intended to not only benefit consumers, but also dealers, who will gain access to a new source of inventory in an efficient and cost-effective manner.
Your Auto Advocate, an online community that brings peace of mind to car buyers and owners, has raised $4.2 million dollars in Seed funding, led by Flybridge Capital Partners and joined by NextView Ventures, and Long Journey Ventures.
Congratulations to Zach Shefska, Ray Shefska and the YAA team!
Emerging from an academic project to look at drones, Flock shifted into providing drone insurance, then commercial vehicle insurance. The twist is that it hooks into the telematics of cars so that the vehicle only triggers insurance cover when it’s actually moving, not when it’s sitting on the lot, incapable of causing any accidents.
Flock has now raised $17 million dollars in a Series A funding led by Social Capital LP, the investment vehicle run by Chamath Palihapitiya, best known as a SPAC investor and chairman of Virgin Galactic.
Flock’s existing investors Anthemis Group and Dig Ventures also participated.
This round brings Flock’s total funding to $22 million dollars.
Redwood Materials has raised $700 million dollars in a Series C round led by T. Rowe Price and including Goldman Sachs, Baillie Gifford, the CANADA PENSION PLAN, and Fidelity Investments.
Previous investors — Capricorn Investment Group’s Technology Impact Fund, Bill Gates’ Breakthrough Energy Ventures and Amazon’s The Climate Pledge Fund — returned to put more capital into Redwood. Valor Equity Partners, Emerson Collective and Franklin Templeton also participated.
Redwood previously raised $40 million dollars in a Series B round and some seed money, which brings its total raise to just under $800 million dollars. The company’s post-funding valuation is $3.7 billion dollars.
Redwood Materials is aiming to create a circular supply chain. This closed-loop system will be essential if the world’s battery cell producers hope to have the supply needed for consumer electronics and the coming wave of electric vehicles.
European electric vehicle charging company Allego will go public through a merger with a blank-check firm backed by private equity giant Apollo Global Management, in a deal valuing the equity of the combined company at $3.14 billion dollars.
The deal with SPARTAN ACQUISITION CORP 3 will generate proceeds of $702 million dollars, with $150 million dollars coming from a private investment in public equity (or PIPE) transaction.
Investors in the PIPE deal include Hedosophia, ECP, EV company Fisker and affiliates of Apollo.
In international news this week, Instacarro, a digital marketplace that connects used car sellers to dealers in Brazil, has raised $23 million dollars in a Series B round of funding.
Notably, U.S.-based firms co-led the investment, including J Ventures, FJ Labs and Rise Capital. Spain’s All Iron Ventures and Big Sur also participated in the financing, among others.
With the latest round, InstaCarro has now raised more than $56 million dollars since its inception in 2015.
InstaCarro plans to use its new capital in part to capitalize on the shift and aggressively expand its reach within Brazil.
The startup compares itself to Carvana in the U.S., Che-hao-duo in India and CARRO in Indonesia.
Inspired by the early success of AUTO1 Group in Europe, InstaCarro decided to return to Latin America to build a similar model, with an exclusive initial focus on Brazil because it is the third-largest car market in the world.
Ridehailing startup Bolt has raised €600 million Euros (or $712 million US dollars) as it plans to enter the online rapid grocery delivery market.
The fresh funding values the Estonia-based company at over €4 billion Euros (or $4.75 billion US dollars) and came from investors including Sequoia Capital, D1 Capital Partners and G Squared.
Bolt will plow some of the cash into a 15-minute grocery delivery service, Bolt Market, which it plans to launch in 10 European countries over the next few months. The company will also invest in existing services such as restaurant food delivery, car-sharing, and scooter and bike rentals.
The rapid grocery delivery market has become fiercely competitive in Europe during the pandemic. The sector has attracted hundreds of millions of dollars from VCs and is starting to reach a saturation point in many markets.
Mexican-based automotive marketplace Kavak, which reached a valuation of $4 billion US dollars, is buying a controlling stake at Turkish automotive company Garaj Sepeti.
Kavak, which was founded in 2016 and is backed by Japan’s SoftBank Group Corp, became Mexico’s first tech “unicorn” last October when it reported a valuation of more than $1 billion.
Kavak is an online platform for buying and selling used cars operating in Mexico and Argentina and Brazil.
Fixcraft, an Indian tech-enabled car bodyshop, has raised $1 million dollars in equity and debt from a marquee angel investor and UBIQUITY CAPITAL, respectively.
The startup will use the funding to open 10 new workshops in India by the end of the year.
Founded in October 2018, Fixcraft provides end-to-end car-repair services—from picking up the vehicle from a customer’s location to filing insurance claims, if any, in case of an accident. The company, which at present has three workshops, has provided services to 3,500 customers so far.
The startup has so far raised $1.5 million, including the current round.
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 AutoBuy and Kyte.
Are you a consumer who needs cash quickly for your vehicle?
AutoBuy makes selling your quality pre-owned vehicle fast and easy by buying your used vehicle for the maximum price possible.
Call AutoBuy – regardless of your used vehicle’s condition – and set up a free appraisal with one of their expert buyers.
AutoBuy is one of the largest car buying companies in the State of Florida and is committed to paying its customers more.
AutoBuy is currently serving Florida customers in twelve different locations throughout a variety of counties.
If you have a car to sell, you can take advantage of their simple car buying process.
As they say at AutoBuy: “We Pay the MAX”
Tired of the inconvenience of having to go to a rental car counter to rent a car?
Kyte provides consumers with Rental cars delivered to your door. Reserve a new, clean car, and a driver will bring it to you, whenever you need it.
Kyte feeds into the rapidly expanding convenience economy.
Reserve a Kyte and a driver will bring it to you, on-demand. When you’re done, a driver will pick up your Kyte from the location of your choice.
Kyte is making the car rental process far easier.
So that’s your weekly Friday Five, a quick wrap-up of the big deals in automotive technology 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.
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.
If you’re an early-stage automotive technology entrepreneur looking to raise money, or an entrepreneur who wants to chat about the best timing and process to sell your company to achieve the best outcome, I’d love to discuss it with you at firstname.lastname@example.org.
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Besides having an outstanding, extremely talented, and hardworking team up here at the studio, I greatly appreciate the valuable role that CBT News plays in the automotive industry.
Every day, I eagerly look forward to my morning email from CBT News to ensure I’m getting the most up-to-date and relevant information on the industry.
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