GM Cruise raises $1.15B at a $19B valuation from SoftBank and Honda

By Kirsten Korosec

GM Cruise has raised another $1.15 billion in new equity from a group of investors that includes T. Rowe Price Associates, Honda, SoftBank Vision Fund and its parent company GM, as the self-driving vehicle company pushes to launch a commercial autonomous ride-hailing service this year.

This investment increases Cruise’s post-money valuation to $19 billion, inclusive of SoftBank’s previously announced investment commitment. Cruise has secured capital commitments totaling $7.25 billion in the past year, according to the company.

“Developing and deploying self-driving vehicles at massive scale is the engineering challenge of our generation,” said Cruise CEO Dan Ammann . “Having deep resources to draw on as we pursue our mission is a critical competitive advantage.”

GM Cruise has one of the most aggressive timelines among companies hoping to deploy a commercial self-driving vehicle service. GM’s self-driving unit has stuck to its previously stated timeline to launch a commercial service “sometime in 2019.”

Cruise has grown from a small startup with 40 employees to more than 1,000 today at its San Francisco headquarters.

And Cruise isn’t curtailing that rate of growth; it’s accelerating it.

Cruise announced in November plans to expand to Seattle, in pursuit of more engineering talent to develop its technology. GM Cruise aimed to hire between 100 to 200 engineers by the end of 2019. The company, now led by Ammann, who left his post as president of GM to take the job, plans to hire at least 1,000 more engineers and other personnel by the end of the year. (Kyle Vogt, a Cruise co-founder who was CEO and also unofficially handled the chief technology officer position, is now president and CTO.)

Arden Hoffman, who helped scale Dropbox, left the file-sharing and storage company to head up human resources at Cruise and help the company scale quickly.

The GM subsidiary is expanding its office space in San Francisco to accommodate the growth. GM Cruise will keep its headquarters at 1201 Bryant Street in San Francisco. The company also will take over Dropbox headquarters at 333 Brannan Street some time this year, a move that will triple Cruise’s office space in San Francisco.

GM Cruise received a $2.25 billion investment by SoftBank’s vision fund in May 2018. That first SoftBank investment was cut into two parts, with the first tranche of $900 million made at the closing of the transaction. Once Cruise’s autonomous vehicles are ready for commercial deployment, SoftBank will complete the second investment of $1.35 billion, the companies said at the time.

A few months later, Honda committed $2.75 billion as part of an exclusive agreement with GM and Cruise to develop and produce a new kind of autonomous vehicle.

As part of that agreement, Honda will invest $2 billion into the effort over the next 12 years. At the time, Honda made an immediate and direct equity investment of $750 million into Cruise. Honda’s investment gives the automaker a 5.7% stake in Cruise.

Source. Kirsten Korosec, Techcrunch, May 4, 2019

***

This post was brought to you by Woewoda Communications, your partner in the Canadian private equity and startup markets; offering strategic communications, public relations & investor relation services to Canadian VCs, PEs, Angels, Endowments/Trusts, Family Offices, and Canadian startups involved in ICT, IoT, blockchain, life sciences, healthcare, agribusiness, clean energy, fintech, AI and robotics.

Are you a Canadian GP/LP/CI or a Canadian startup that needs to grow or scale? Give us a call! One of our representatives would love to explain how we vertically design, and then systematically layer each of our communication platforms to effectively reach niche target audiences for our clients. WC offers a unique synergistic approach to effectively communicate our client's message to their target audience.

Serving Vancouver, Montreal, Toronto, Waterloo, Ottawa and Halifax.

India’s Ather Energy raises $51 million to grow its electric scooters business

By Manish Singh

There’s more money racing into India’s increasingly competitive two-wheeler market after electric scooter maker Ather Energy said today it has raised $51 million in new funding.

The round was led by early backer Sachin Bansal, the co-founder of Flipkart, who invested $32 million. The rest of the money was provided by Hero MotoCorp, which added $19 million in convertible debt, and venture debt VC firm InnoVen Capital, which put in $8 million. The deal means that the six-year-old startup has raised around $90 million to date. Ather Energy was valued at about $400 million in the new round, a person familiar with the matter said.

In an interview with TechCrunch, Tarun Mehta, co-founder and CEO of Ather Energy, said the startup will use the fresh capital to expand to new cities, and ramp up its manufacturing capacity and supply chain network. Ather’s scooters, currently available only in Bengaluru, will be launched in Chennai followed by other unspecified cities, he said.

Ather Energy will also attempt to produce 20,000 to 25,000 scooters a year through its own manufacturing plant in Bengaluru, Mehta revealed. The company is also keen to expand its product portfolio, which currently numbers just two scooter models — Ather 340 (priced at $1,600) and 450 ($1,770). By 2023, the startup is aiming to grow its presence to more than 30 cities, with over 6,500 charging stations — up from 38 currently — and production capacity of a million scooters in a year.

There’s some way to go before it can reach those lofty goals, but Ather has built a fan-following in the nation for its scooters in recent years. Its scooters sport high storage battery density (2.4 KWh Lithium-ion), a dashboard for navigation information, 75 km of mileage and take less than three hours to fully charge.

That’s led Mehta to call the Ather 450 “the most powerful smart scooter in the Indian market.”

Ather Energy offers its scooters to consumers in three ways: outright purchase, purchase with a subscription for value-added features and leasing, an option it only recently introduced.

The company’s competitors include Vogo, Bounce and Yulu, which earlier this month inked a deal with Uber to conduct a trial in the nation. Another big name is also involved: Uber rival Ola has invested about $100 million in startup Vogo, which operates in Bengaluru and Hyderabad.

Mehta said he thinks electric scooters are a good fit for ride-hailing giants, and that’s something he is open to exploring at a later stage. But for now, his startup will stick to its B2C (business to consumer) play.

In a prepared statement, Sachin Bansal, who has emerged as one of the most prolific VCs in India, said, “Their [Ather Energy’s] focus on end to end customer experience will open up new revenue opportunities and accelerate the adoption of electric vehicles in India. The future is electric and I am excited to be a part of this journey in shaping the future.”

Source. Techcrunch, Manish Singh,  May 28, 2019

***

This post was brought to you by Woewoda Communications, your partner in the Canadian private equity and startup markets; offering strategic communications, public relations & investor relation services to Canadian VCs, PEs, Angels, Endowments/Trusts, Family Offices, and Canadian startups involved in ICT, IoT, blockchain, life sciences, healthcare, agribusiness, clean energy, fintech, AI and robotics.

Are you a Canadian GP/LP/CI or a Canadian startup that needs to grow or scale? Give us a call! One of our representatives would love to explain how we vertically design, and then systematically layer each of our communication platforms to effectively reach niche target audiences for our clients. WC offers a unique synergistic approach to effectively communicate our client's message to their target audience.

Serving Vancouver, Montreal, Toronto, Waterloo, Ottawa and Halifax.