However, there’s a notable contrast between these forward-looking bets and continued investments in more traditional pillars of the automotive ecosystem. Whereas companies in the former category seek to revolutionize the way we own and operate vehicles, startups in the latter are augmenting contemporary retail and service models with tech.
These startups are clear bets on the considerable size of today’s ICE-powered vehicle opportunity, and a more gradual rate of EV adoption in the short- to medium-term. Investors, too, may be hoping to exit before electrification takes full hold.
The financings also buck overall trends in the on-demand space, where activity has fallen sharply since 2015 as investors have cast a critical eye on the space’s economics. These companies will bear a considerable asset load (with their refueling truck fleets) and must scale to succeed; indeed, some players are targeting office parking lots, where many vehicles can be refueled at once.
Much ink has also been spilled over fleet-based ride-hailing and sharing supplanting personal vehicle ownership, but investments in traditional auto retail are still coming fast and furious. Check out the full brief for more on these startups.
(On that last point, Fair launched from stealth this week. The erstwhile Beepi suitor offers access to vehicles through a mobile app, with a commitment-free monthly payment including warranty and maintenance. As with similar concepts like Cadillac’s Book, this purportedly “frictionless” model lands somewhere between short-term car-sharing and traditional multi-year leases.)