Another AV simulation funding. Toyota's startup moves analyzed. Autotech's $120M fund.
Corporate adventures
Hi there,
Toyota has become the latest OEM to carve out a dedicated venture unit, joining longer-tenured corporate VC (CVC) programs like GM Ventures and BMW i Ventures as well as newer units like JLR’s InMotion and Scania Growth Capital.
Dubbed Toyota AI Ventures, the new arm will slot in under Toyota Research Institute (TRI), hewing closely to its parent’s research focus areas of AI, cloud & data, robotics, and AVs.
We used our social graph tool to break down Toyota’s startup bets to date, with green lines representing investments and red lines indicating acquisitions:
We also used our data to extract a few insights:
Electrification gap: The maker of the world’s best-selling hybrid has shied away from external investments in EV startups. This mirrors its internal strategy that was originally more bullish on fuel-cell tech than full vehicle electrification, and has recently reversed course. Toyota’s lone EV bet since 2012 was its stake in Chargepoint‘s Series D in May 2012 (not pictured here is Toyota’s $50M Tesla investment in 2010).
Accelerating pace: Excluding Chargepoint, all of the other disclosed deals pictured have taken place since December 2015, as Toyota has dived headlong into private markets like other OEMs.
AI spotlight: Given the new venture arm’s focuses (and name), it’s not surprising that Toyota/TRI has been an active investor in AI and AV startups, including Preferred Networks, Nauto, Slamcore, and others. As an expansion of TRI’s investment mandate, the CVC will assume its parent’s positions in three of these startups, boxed in red above.
Robotics focus: Robotics and AI applications in the field (both within and outside of auto) have long been of interest for TRI and Toyota generally. This emphasis has also extended to the private markets, with deals like Toyota’s Jaybridge acqui-hire and Intuition Robotics stake.
Looking ahead, Toyota AI Ventures will start with an initial $100M in capital for early-stage investments. Like most CVCs, the firm’s investments will prioritize strategic goals over outright financial return. Note the prominent goal of accessing “scarce talent”, a crucial issue that has motivated other OEM investments like Ford’s Argo deal.
Trucking tech startups continue to see larger financings in 2017, with Transfix raising a $42M Series C led by NEA. Developments are coming rapid-fire both among early-stage startups and larger tech companies working on trucking programs (like Waymo and Uber).
We updated our view of funding trends into the space through the first half of the year, and the data reinforces the general up-and-to-right mood in the field:
Annual deals and dollars are both on track to eclipse last year’s highs, and we’re beginning to see sustained deal and dollar funding on a quarterly basis as well. A deal share breakdown also points to a maturing financing ecosystem as mid- and late-stage activity has risen. Check out all the data in the full post.
This week in auto tech
We saw recurring themes in mobility this week, mixed with new developments and fresh perspectives. Full blurb as always below, but here were a few of the highlights:
Uber-Yandex: The $3.7B merger agreement between the ride-hailing rivals will see Russia’s Yandex assume a controlling position in a new joint venture. Uber will take a minority stake and cede active control of operations in Russia and neighboring countries (reminiscent of the Didi-Uber China deal).
Simulation developments: AV simulation startups continue to attract interest and funding; Metamoto raised $2M led by Motus Ventures, while RightHook launched its second product, an ADAS hardware testing solution.
Autotech Ventures: The mobility VC closed its first fund at $120M, aiming to connect corporate LPs (including OEMs and suppliers) with its startup investments. We’re seeing more of these strategically-oriented, vertically-targeted VCs being launched; Fifth Wall Ventures is one recent example from real estate. This will be an interesting trend to track across other sectors.
Audi’s L3 cars: The automaker is touting the new generation of its A8 flagship as the first production vehicle capable of level 3 (conditional) autonomous driving. The new A8’s Traffic Jam Pilot is capable of hands-free autonomous driving, albeit up to 37mph only and subject to local regulatory approvals.
Mobile service: Much like its manufacturing processes, Tesla is expanding its service network ahead of its Model 3 launch. The EV maker will not only add to its physical service footprint, but also field hundreds of new mobile service vans to its roaming fleet for house calls. (BMW i Ventures also backed a repair-booking and remote diagnostics startup this week.)
