Technological advances for autonomous vehicles are causing meaningful changes in the auto industry. Both financial and strategic investors (i.e OEMs, tech companies, auto suppliers, etc.) are allocating a significant amount of capital to the sector. Over $1 billion was invested in small independent auto tech companies in 2016 – a 91% increase from the previous year, according to CB Insights. Even more is expected for 2017 – see below for notable 2017 capital raises.
Last year, Apple tapped a key executive to lead efforts to develop an autonomous driving system. BMW is teaming with Intel and Mobileye in attempts to bring self-driving cars to market by 2021. Intel predicts autonomous cars will spawn a ‘passenger economy’ – services targeted at people while they are no longer driving their cars. Ford recently announced that it would take a majority stake in AI startup Argo and will invest $5 billion over 5 years as it aggressively pursues opportunities in this field. Audi will become the first company to test autonomous vehicles in New York when its demonstration car hits the streets of Albany in mid-June 2017. While Uber recently fired their autonomous-car researcher Anthony Levandowski (over the lawsuit with Waymo – a subsidiary of Google’s parent company Alphabet), it remains a key part of their strategic plans for the future especially given Waymo’s recent announcement that it is teaming up with Lyft.
By 2030, self-driving cars are expected to comprise up to 15% of total vehicles sold, according to McKinsey. Venky Ganesan, managing director of the California-based venture capital firm Menlo Ventures, estimates that autonomous cars will cause a 20% increase in auto buying habits, which would mean a $1.8 trillion impact on the world economy.
Notable 2017 Auto Tech Capital Raises
|Karamba Security||12||May-17||Israel-based provider of cybersecurity for autonomous vehicles. Capital will be used to expand customer support, sales, and R&D. Series B funding was led by YL Ventures and Fontinalis Partners and investors included GlenRock Israel, Paladin Capital Group, Liberty Mutual Strategic Ventures, Presidio Ventures, and Asgent Inc.|
|DeepMap||25||May-17||Company develops HD maps for autonomous cars by using precise mapping, real-time localization, and an infrastructure that supports global scaling. Capital will be used to expand and improve upon mapping and localization. This round was led by Accel and investors include Andreessen Horowitz and GSR Ventures.|
|Valens||60||Apr-17||Company’s technology increases the bandwidth and wiring for Advanced Driver Assistance Systems. Capital will be used for the development of new products and customer support. The round was led by Israel Growth Partners and other investors included Delphi, Samsung Catalyst Fund, Goldman Sachs, and MediaTek.|
|Peloton Technology||60||Apr-17||Automatic vehicle technology company that focuses on safety and efficiency in the trucking industry. Capital will be used to help the company scale up as it brings its platooning system to the market. Investors include: Omnitracs led this Series B round.|
|TetraVue||10||Feb-17||Company develops light detection technology which enables autonomous vehicles to visualize their surroundings. Technology is regarded for its efficiency, high quality resolution, and fast detection of objects, and it works in any weather during the day or night. Capital will be used to bring the technology to the autonomous car industry. Financing is led by Robert Bosch Venture Capital and Nautilus Venture Partners, who are joined by Samsung Catalyst Fund and Foxconn.|
|ClearMotion||100||Feb-17||Automotive technology company developing the world’s first digital automobile chassis, which will allow vehicles to monitor road conditions and adapt to them in real time. J.P. Morgan Asset Management led this Series C funding, along with New Enterprise Associates, Qualcomm Ventures, World Innovation Lab, and Eileses Capital.|
|Neurala||14||Jan-17||Software and services company that developws a deep learning neural network platform to enable autonomy and interactivity in self-driving cars, including navigating obstacles based on its assessment of the environment. This Series A funding was led by Pelion Ventures with participation from Sherpa Capital, Motorola Ventures, 360 Capital Partners, Draper Associates Investments, SK Ventures, and Idinvest Partners.|
Sources: bankrate.com, McKinsey, Autoweek, Forbes, CB Insights