transport
Auto Added by WPeMatico
Nigeria’s Gokada raises $5.3M round for its motorcycle ride-hail biz
In many large cities across Africa, motorcycle taxis are as common as yellow cabs in New York.
That includes Lagos, Nigeria, where ride-hail startup Gokada has raised a $5.3 million Series A round to grow its two-wheel transit business.
Gokada has trained and on-boarded more than 1,000 motorcycles and their pilots on its app that connects commuters to moto-taxis and the company’s signature green, DOT– approved helmets.
The startup has completed nearly 1 million rides since it was co-founded in 2018 by Fahim Saleh — a Bangladeshi entrepreneur who previously founded and exited Pathao, a motorcycle, bicycle and car transportation company.
For Gokada’s Series A, Rise Capital led the investment, joined by Adventure Capital, IC Global Partners and Illinois-based First MidWest Group. Coinciding with the round, Nigerian investor and Jobberman founder Ayodeji Adewunmi will join Gokada as co-CEO.
Gokada will use the financing to increase its fleet and ride volume, while developing a network to offer goods and services to its drivers. “We’re going to start a Gokada club in each of the cities with a restaurant where drivers can relax, and we’ll experiment with a Gokada Shop, where drivers can get things they need on a regular basis, such as plantains, yams and rice,” Saleh told TechCrunch.
The startup differs from other ride-hail ventures in that it doesn’t split fare revenue with drivers. Gokada charges drivers a flat-fee of 3,000 Nigerian Naira a day (around $8) to work on their platform. The company is looking to generate a larger share of its revenue from building a commercial network around its rider community.
“We don’t do anything with the fares. We want to create an Amazon Prime-type membership…and ecosystem around the driver where we’re going to provide them more and more services, such as motorcycle insurance, maintenance, personal life-insurance and micro-finance loans,” Saleh said.
“We’re trying to provide a network of great services for our drivers that makes them stick with us, and not necessarily see a reason to switch to other platforms,” said Saleh.
Competition among those platforms is heating up, as global players enter Africa’s motorcycle taxi market and local startups raise VC and expand to new countries.
Uber began offering a two-wheel transit option in East Africa in 2018, around the same time Bolt (previously Taxify) started motorcycle taxi service in Kenya.
Rwanda has motorbike taxi startups SafeMotos and Yegomoto. Uganda-based motorcycle ride-hail company SafeBoda expanded into Kenya in 2018 and this month raised a Series B round of an undisclosed amount, co-led by the venture arms of Germany’s Allianz and Indonesia’s Go-Jek.
SafeBoda will use the round to further expand in East Africa and Nigeria in the near future, the startup’s co-CEO Maxime Dieudonne confirmed to TechCrunch.
In Nigeria, Gokada faces a competitor in local startup MAX.ng, which offers mobile-based passenger and logistics delivery services.
Overall, Africa’s motorcycle taxi market is becoming a significant sub-sector in the continent’s e-transport startup landscape. Two-wheel transit startups are vying to digitize a share of Africa’s boda boda and okada markets (the name for motorcycle taxis in East and West Africa) — representing a collective revenue pool of $4 billion and expected to double to $9 billion by 2021, according to a TechSci study.
“There is a formalization of an informal sector play here…to make it safer and higher quality,” Gokada investor Nazar Yasin of Rise Capital told TechCrunch.
The appeal to passengers is the lower cost of motorbike transit compared to buses or cabs ($1.85 is Gokada’s average fare) and the ability of two-wheelers to cut through the heavy congestion in cities such as Lagos and Nairobi.
A notable facet of motorcycle ride-hail companies in Africa is better organizing a space with a reputation for being somewhat chaotic and downright dangerous (see Nigeria’s past bans on the sector entirely due to safety).
For Gokada that includes training courses and certification of riders, the ability to track trips and safety stats from the app, and quality control for motorcycles — something that’s been lacking in East and West Africa’s non-digital moto-taxi space.
The company’s rider program offers a way for drivers to buy, own and maintain their motorcycles as they earn. Gokada has entered into partnership with Indian motorcycle maker TVS Motors to create a custom version of the company’s TVS Apache motorcycles for Gokada drivers.
Gokada is also experimenting with adding sensors to its fleet to better track safety standards. “We’re looking at seat sensors and another GPS sensor to track things like ‘did this driver add more than one passenger on the bike’ and all that data will feed back into our servers,” Saleh said.
The company won’t enter any new countries in Africa in the near future. “We plan to expand all over Nigeria. We think it’s a large enough market for now,” said Saleh. Nigeria is Africa’s most populous nation (190 million) and largest economy.
Powered by WPeMatico
Slack aims to be the most important software company in the world, says CEO
Slack this morning disclosed estimated preliminary financial results for the first quarter of 2019 ahead of a direct listing planned for June 20.
Citing an addition of paid customers, the workplace messaging service posted revenues of about $134 million, up 66% from $81 million in the first quarter of 2018. Losses from operations increased from $26 million in Q1 2018 to roughly $39 million this year.
In addition to filing updated paperwork, the Slack executive team gathered on Monday to make a final pitch to potential shareholders, emphasizing its goal of replacing email within enterprises across the world.
“People deserve to do the best work of their lives,” Slack co-founder and chief executive officer Stewart Butterfield said in a video released alongside a live stream of its investor day event. “This desire of feeling aligned with your team, of removing confusion, of getting clarity; the desire for support in doing the best work of your life, that’s universal, that’s deeply human. It appeals to people with all kinds of roles, in all kinds of industries, at all scales of organization and all cultures.”
“We believe that whoever is able to unlock that potential for people … is going to be the most important software company in the world. We aim to be that company,” he added.”
Slack, valued at more than $7 billion with its last round of venture capital funding, plans to list on the NYSE under the ticker symbol “SK.”
The business filed to go public in April as other well-known tech companies were finalizing their initial public offerings. Following Uber’s disastrous IPO last week, public and private market investors alike will be keeping a close-eye on Slack’s stock market performance, which may determine Wall Street’s future appetite for Silicon Valley’s unicorns.
Though some of the recent tech IPOs performed famously, like Zoom, Uber and Lyft’s performance has served as a cautionary tale for going out in poor market conditions with lofty valuations. Uber began trading last week at below its IPO price of $45 and is today down significantly at just $36 per share. Lyft, for its part, is selling for $47.5 apiece today after pricing at $72 per share in March.
Slack isn’t losing billions per year like Uber, but it’s also not as close to profitability as expected. In the year ending January 31, 2019, Slack posted a net loss of $138.9 million and revenue of $400.6 million. That’s compared to a loss of $140.1 million on revenue of $220.5 million for the year ending January 31, 2018. In its S-1, the company attributed its losses to scaling the business and capitalizing on its market opportunity.
Workplace messaging startup Slack said Monday, February 4, 2019 it had filed a confidential registration for an initial public offering, becoming the latest of a group of richly valued tech enterprises to look to Wall Street. (Photo by Eric BARADAT / AFP) (Photo credit should read ERIC BARADAT/AFP/Getty Images)
Slack currently boasts more than 10 million daily active users across more than 600,000 organizations — 88,000 on the paid plan and 550,000 on the free plan.
Slack has been able to bypass the traditional roadshow process expected of an IPO-ready business, opting for a path to Wall Street popularized by Spotify in 2018. The company plans to complete in mid-June a direct listing, which allows companies to forgo issuing new shares and instead sell directly to the market existing shares held by insiders, employees and investors. The date, however, is subject to change.
Slack has previously raised a total of $1.2 billion in funding from investors, including Accel, Andreessen Horowitz, Social Capital, SoftBank, Google Ventures and Kleiner Perkins.
Powered by WPeMatico
Equity Shot: Judging Uber’s less-than-grand opening day
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.
We are back, as promised. Kate Clark and Alex Wilhelm re-convened today to discuss the latest from the Uber IPO. Namely that it opened down, and then kept falling.
A few questions spring to mind. Why did Uber lose ground? Was it the company’s fault? Was it simply the macro market? Was it something else altogether? What we do know is that Uber’s pricing wasn’t what we were expecting and its first day was not smooth.
There are a whole bunch of reasons why Uber went out the way it did. Firstly, the stock market has had a rough week. That, coupled with rising U.S.-China tensions made this week one of the worst of the year for Uber’s monstrous IPO.
But, to make all that clear, we ran back through some history, recalled some key Lyft stats, and more.
We don’t know what’s next but we will be keeping a close watch, specifically on the next cohort of unicorn companies ready to IPO (Postmates, hi!).
Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple Podcasts, Overcast, Pocket Casts, Downcast and all the casts.
Powered by WPeMatico
How the trade war with China hit Uber’s public offering
Uber’s much heralded public offering has arrived not so much with a bang as with a whimper, thanks largely to the ongoing trade war between the U.S. and China.
Overnight, the U.S. government made good on the threat from President Donald Trump to hike tariffs on $200 billion worth of Chinese goods to 25% up from 10%.
As a result, stock markets slid further on Friday, and their decline hit Uber’s initial public offering. The company’s shares began trading at $42.54, below its initial pricing of $45 per share.
At its initial pricing, Uber was valued at $75.5 billion, below the $120 billion price that Wall Street thought the company would fetch late last year, but still among the biggest public offerings in history. Only Facebook’s $81 billion public offering and the whopping $169 billion debut of Alibaba were bigger, according to a Dealogic analysis cited by Business Insider.
Uber’s historic public offering — which was designed to raise at least $90 billion for the ride-hailing giant — was no match for the equally historic struggle between the U.S. and China’s emerging economic superpower.
The rising tariffs were designed to hit business equipment, but will also affect prices on some $40 billion in consumer goods — ranging from clothes to furniture, refrigerators, washers and dryers.
Trump boosted tariffs after China reneged on certain concessions it had made during the trade negotiations. Chiefly, the U.S. was looking for written commitments from the Chinese government that it would provide less direct support to its state-owned enterprises and loosen restrictions on U.S. companies operating in the country.
Uber’s disappointing debut can’t be chalked up to trade woes alone. Its immediate American rival, Lyft, has seen its stock decline precipitously since its opening at nearly $79 per share. Lyft is now trading at around $55 per share.
Yesterday, Lyft reported its first earnings as a public company, losing $1.14 billion on $776 million in revenue.
While Lyft is focused on consumer transportation, Uber has expanded to include freight shipping and meal delivery as part of its attempts to become an all-in-one hub for consumer and business logistics.
That expansion has come at a cost. The company may have generated revenues of $11.3 billion in 2018, but it operated at a $3 billion loss for the year. And Uber is deeply in the red. With deficits reaching nearly $8 billion by the end of 2018, as MarketWatch points out.
Trade wars, it seems, trump transportation disruption.
Powered by WPeMatico
Singapore’s Grain, a profitable food delivery startup, pulls in $10M for expansion
Cloud kitchens are the big thing in food delivery, with ex-Uber CEO Travis Kalanick’s new business one contender in that space, with Asia, and particularly Southeast Asia, a major focus. Despite the newcomers, a more established startup from Singapore has raised a large bowl of cash to go after regional expansion.
Founded in 2014, Grain specializes in clean food while it takes a different approach to Kalanick’s CloudKitchens or food delivery services like Deliveroo, FoodPanda or GrabFood.
It adopted a cloud kitchen model — utilizing unwanted real estate as kitchens, with delivery services for output — but used it for its own operations. So while CloudKitchens and others rent their space to F&B companies as a cheaper way to make food for their on-demand delivery customers, Grain works with its own chefs, menu and delivery team. A so-called “full stack” model, if you can stand the cliched tech phrase.
Finally, Grain is also profitable. The new round has it shooting for growth — more on that below — but the startup was profitable last year, CEO and co-founder Yi Sung Yong told TechCrunch.
Now it is reaping the rewards of a model that keeps it in control of its product, unlike others that are complicated by a chain that includes the restaurant and a delivery person.
We previously wrote about Grain when it raised a $1.7 million Series A back in 2016, and today it announced a $10 million Series B, which is led by Thailand’s Singha Ventures, the VC arm of the beer brand. A bevy of other investors took part, including Genesis Alternative Ventures, Sass Corp, K2 Global — run by serial investor Ozi Amanat who has backed Impossible Foods, Spotify and Uber among others — FoodXervices and Majuven. Existing investors Openspace Ventures, Raging Bull — from Thai Express founder Ivan Lee — and Cento Ventures participated.
The round includes venture debt, as well as equity, and it is worth noting that the family office of the owners of The Coffee Bean & Tea Leaf — Sassoon Investment Corporation — was involved.
Grain covers individual food as well as buffets in Singapore
Three years is a long gap between the two deals — Openspace and Cento have even rebranded during the intervening period — and the ride has been an eventful one. During those years, Sung said the business had come close to running out of capital before it doubled down on the fundamentals before the precarious runway capital ran out.
In fact, he said, the company — which now has more than 100 staff — was fully prepared to self-sustain.
“We didn’t think of raising a Series B,” he explained in an interview. “Instead, we focused on the business and getting profitable… we thought that we can’t depend entirely on investors.”
And, ladies and gentleman, the irony of that is that VCs very much like a business that can self-sustain — it shows a model is proven — and investing in a startup that doesn’t need capital can be attractive.
Ultimately, though, profitability is seen as sexy today — particularly in the meal space, where countless U.S. startups have shuttered, including Munchery and Sprig — but the focus meant that Grain had to shelve its expansion plans. It then went through soul-searching times in 2017 when a spoilt curry saw 20 customers get food poisoning.
Sung declined to comment directly on that incident, but he said that company today has developed the “infrastructure” to scale its business across the board, and that very much includes quality control.
Grain co-founder and CEO Yi Sung Yong [Image via LinkedIn]
Grain currently delivers “thousands” of meals per day in Singapore, its sole market, with eight-figures in sales per year, he said. Last year, growth was 200 percent, Sung continued, and now is the time to look overseas. With Singha, the Grain CEO said the company has “everything we need to launch in Bangkok.”
Thailand — which Malaysia-based rival Dahamakan picked for its first expansion — is the only new launch on the table, but Sung said that could change.
“If things move faster, we’ll expand to more cities, maybe one per year,” he said. “But we need to get our brand, our food and our service right first.”
One part of that may be securing better deals for raw ingredients and food from suppliers. Grain is expanding its “hub” kitchens — outposts placed strategically around town to serve customers faster — and growing its fleet of trucks, which are retrofitted with warmers and chillers for deliveries to customers.
Grain’s journey is proof that startups in the region will go through trials and tribulations, but being able to bolt down the fundamentals and reduce burn rate is crucial in the event that things go awry. Just look to grocery startup Honestbee, also based in Singapore, for evidence of what happens when costs are allowed to pile up.
Powered by WPeMatico
Equity Shot: Uber’s IPO terms and Slack’s S-1
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.
Kate and Alex are back (again), bringing you the latest on the IPO front. As Friday is coming to a close, we’ll keep this post short to leave plenty of room for you to dig into the audio. Welcome to the weekend.
Up first we dug into Uber’s latest S-1 filing. This time, the company set a price range for itself (TechCrunch’s coverage here), valuing itself at $84 billion and also detailing estimates of its first-quarter results (Crunchbase News’s notes here).
We suspect Uber will ultimately price a top that range. Time will tell.
And then we turned to Slack, who’s direct listing will help set the historical tone for the unicorn era; screw your money, Slack says, we have our own. Well maybe not, but the company has impressive growth, killer margins, and, to our surprise, larger GAAP deficits than we expected. The company’s filing was fascinating.
But worry not, we can figure out how to value Slack. It’s Uber that left us scratching our heads. Expect next week to be another blizzard of news and numbers.
Thanks as always for listening to the show. We’ve never had more downloads than these last few weeks. It means a lot that you want to hang out with us. Don’t forget that we have an email address (equitypod@techcrunch.com), and a hashtag that Alex needs to learn to use: #equitypod.
Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple Podcasts, Overcast, Pocket Casts, Downcast and all the casts.
Powered by WPeMatico
Postmates has launched in 1,000 new cities since December
Postmates is expanding like crazy ahead of an initial public offering expected later this year. The food delivery business has launched in 1,000 new cities since December, the company announced today.
San Francisco-based Postmates now operates its on-demand delivery platform, powered by a network of local gig economy workers, in 3,500 cities across all 50 states. Postmates does not yet operate in any international markets aside from Mexico City.
“We want to enable anyone to have anything delivered on demand and this latest expansion allows us to deliver on that promise across all 50 states in the US,” Postmates co-founder and chief executive officer Bastian Lehmann said in a statement.
The company says it now reaches 70 percent of U.S. households and delivers food from some 500,000 restaurants, helping it to compete with food-delivery powerhouses Uber Eats and DoorDash. Additionally, Postmates recently launched Postmates Party, a new feature that lets customers within the same neighborhood pool their orders.
Postmates is poised to follow Uber into the public markets. The company — which has raised more than $670 million in venture capital funding, including a $100 million pre-IPO financing in January that valued the business at $1.85 billion — filed confidentially for a U.S. IPO in February.
The company completes 5 million deliveries per month and was reportedly expected to record $400 million in revenue in 2018 on food sales of $1.2 billion. Uber Eats, for its part, was expected to begin reaching 70 percent of the U.S. households by the end of 2018 and reportedly has plans in the works to use drones to deliver food by 2021.
DoorDash, meanwhile, is a rocketship. The food delivery company is active in 3,300 cities and claims to be growing 325 percent year-over-year. The company recently closed a $400 million Series F financing at a $7.1 billion valuation. It’s likely to go public in the next year, too.
Powered by WPeMatico
Canoo, the electric vehicle startup formed from Faraday Future’s ashes, seeks $200 million
Less than a month after rebranding as Canoo, the startup electric vehicle company formerly known as Evelozcity is on the hunt for $200 million in new capital.
The startup, which is backed by a clutch of private individuals and family offices hailing from China, Germany and Taiwan, is hoping to line up the new capital from some more recognizable names as it finalizes supply deals with vendors, according to a person with knowledge of the company’s plans.
Canoo is locking in final contracts with its vendors and is going to be in production with prototypes before the end of the year. The company, which will make its vehicles available through a subscription-based model, already has 400 employees and just announced new key hires along with its rebranding.
It’s a quick ramp for a company that only two years ago was struggling to extricate itself from the morass that was Faraday Future.
Canoo began life as Evelozcity back in 2017. It was formed after Stefan Krause, a former executive at BMW and Deutsche Bank, and another former BMW executive, Ulrich Kranz, absconded from Faraday Future amid that company’s struggles.
Reportedly, Krause and Kranz left over repeated clashes with Faraday’s founding team of Jia Yueting, the main investor and shareholder, and Chaoying Deng, according to the Verge.
The situation at Evelozcity became so toxic that after the two men left, Jia accused them of “malfeasance and dereliction of duty.”
The company was launched in secret, but news of its existence came to light after Faraday Future filed a lawsuit accusing the new company of the theft of trade secrets.
Now, Canoo is rounding out its executive team and pushing forward with plans to bring prototype vehicles to market by the end of the year.
Olivier Bellin joined the company as its head of operations from STMicroelectronics, a Geneva-based semiconductor company where he served as chief financial officer of the company’s U.S. operations.
Former president of BMW manufacturing Clemens Schmitz-Justen also joined the company as its head of manufacturing — overseeing the contract manufacturing strategy, which will see the company outsource production of vehicles in the U.S. and China.
Canoo said that it intends to use a modular “skateboard” approach to its vehicle design where different form factors can rest atop its chassis. The company touts that its different cabins can be tailored to suit the needs of different customers — ranging from commuter vehicles, public or group transportation, delivery vehicles and private cars.
The company is also crafting its user interface and subscription services around its passengers and renters. To that end, Canoo has brought on James Cox, a former Uber executive in charge of product operations for the ride-hailing business’ rider application, who will be developing digital products for the company’s initial customers, according to a March statement.
Initially, Canoo will target customers in Los Angeles and the Bay Area, with additional plans to expand to San Diego and Seattle when the company brings its commercial vehicles to market in 2021.
Canoo plans to use blockchain technology to secure its subscription services and ensure an asset-light approach to development by outsourcing its manufacturing in the U.S. and China, according to one person with knowledge of the company’s plans.
With the development of that subscription model, the car company is taking a page from the playbook other automakers are beginning to toy with. Despite the fact that Cadillac cancelled its Book subscription service late last year, companies like BMW, Volvo and Porsche have all pressed on with their experiments with subscriptions.
As it rolls out its subscription service, Canoo is targeting a lower price point than its competitors for its fully electric and “autonomous-ready” vehicles.
At the end of the day the company believes that there are more than 35 cities around the world that are suitable for its offering.
And now that the lawsuits are over and Faraday Future continues to wobble, it seems that plans for Canoo are gathering steam.
The rebranding effort, and the company’s new name itself, is indicative of its goals.
“We picked Canoo because it sounds distinctive, looks cool and creates a feeling of both relaxation and movement,” said Krause, in a statement. “For thousands of years, a canoe has been a simple, sustainable transportation device used all over the world.”
Powered by WPeMatico
Pinterest prices IPO above range
Pinterest priced shares of its stock, “PINS,” above its anticipated range on Wednesday evening, CNBC reports. The company will sell 75 million shares of Class A common stock at $19 apiece in an offering that will attract $1.4 billion in new capital for the visual search engine.
The NYSE-listed business had planned to sell its shares at between $15 to $17 and didn’t increase the size of its planned offering prior to Wednesday’s pricing.
Valued at $12.3 billion in 2017, the initial public offering gives Pinterest a fully diluted market cap of $12.6 billion.
The IPO has been a long time coming for the nearly 10-year-old company led by co-founder and chief executive officer Ben Silbermann . Given Wall Street’s lackluster demand for ride-hailing company Lyft, another consumer technology stock that recently made its Nasdaq debut, it’s unclear just how well Pinterest will perform in the days, weeks, months and years to come. Pinterest is unprofitable like its fellow unicorns Lyft and Uber, but its financials, disclosed in its IPO prospectus, illustrate a clear path to profitability. As for Lyft and Uber, Wall Street analysts, among others, still question whether either of the businesses will ever achieve profitability.
Eric Kim of consumer tech investment firm Goodwater Capital says despite the fact that Pinterest and Lyft are very different companies, Lyft’s falling stock has undoubtedly impacted Pinterest’s offering.
“They are so close together, it’s hard for those not to influence one another,” Kim told TechCrunch. “It’s a much different category, but they are still both consumer tech and they will both be trading at a double-digital revenue multiple.
The San Francisco-based company posted revenue of $755.9 million in the year ending December 31, 2018 — 16 times less than its latest decacorn valuation — on losses of $62.9 million. That’s up from $472.8 million in revenue in 2017 on losses of $130 million.
The stock offering represents a big liquidity event for a handful of investors. Pinterest had raised a modest $1.47 billion in equity funding from Bessemer Venture Partners, which holds a 13.1 percent pre-IPO stake, FirstMark Capital (9.8 percent), Andreessen Horowitz (9.6 percent), Fidelity Investments (7.1 percent) and Valiant Capital Partners (6 percent). Bessemer’s stake is worth upwards of $1 billion. FirstMark and a16z’s shares will be worth more than $700 million each.
Zoom — another tech company going public on Thursday that, unlike its peers, is actually profitable — priced its shares on Wednesday too after increasing the price range of its IPO earlier this week. The price values Zoom at roughly $9 billion, nearly surpassing Pinterest, an impressive feat considering Zoom was last valued at $1 billion in 2017 around when Pinterest’s Series H valued it at a whopping $12.3 billion.
Profitability, as it turns out, may mean more to Wall Street than Silicon Valley thinks.
Powered by WPeMatico
Sila Nano’s battery tech is now worth over $1 billion with Daimler partnership and $170 million investment
Sila Nanotechnologies and its battery materials manufacturing technology are now worth more than $1 billion.
The company, which announced a $170 million funding led by Daimler and a partnership with the famed German automaker, started building out its first production lines for its battery materials last year. That first line is capable of producing the material to supply the equivalent of 50 megawatts of lithium-ion batteries, according to Sila Nano’s chief executive officer Gene Berdichevsky.
That construction, made on the heels of a $70 million investment round, is now going to be expanded with the new cash from Daimler and 8VC along with previous investors Bessemer Venture Partners, Chengwei Capital, Matrix Partners, Siemens Next47 and Sutter Hill Ventures.
Berdichevsky would not comment on how much production capacity would increase, but did say that the company’s battery materials would find their way into consumer devices before the end of 2020. That means the potential for longer-lasting batteries in smart watches, earbuds and health trackers, initially.
From its headquarters in Alameda, Calif., Sila Nanotechnologies has developed a silicon-based anode to replace graphite in lithium-ion batteries. The company claims that its materials can improve the energy density of batteries by 20 percent.
“If you can increase energy density by 20 percent… you can use 20 percent fewer cells and each pack can cost 20 percent less,” says Berdichevsky. “The subtext of it is that it is the way to drive price of energy storage down. And that’s the way for the electric vehicle market to sand more and more on its own.”
That kind of cost reduction is what brought BMW and Daimler to partner with the company — and what led to the massive funding round and the company’s newfound unicorn status.
“Our valuation is over $1 billion dollars now,” Berdichevsky says.
Image courtesy of Sila Nanotechnologies
For Daimler, the materials that Sila Nanotechnologies are developing will give the company’s commitment to electrification a much needed boost.
Mercedes-Benz has plans to electrify its entire product suite by 2022, the company has said. That means Daimler has to accelerate its production of electrified alternatives to its fuel-powered fleet — everything from its 48-volt electrical system (the EQ Boost), to its plug-in hybrids (EQ-Power) and the more than 10 fully electric vehicles powered by batteries or fuel cells. The company is projecting that between 15 percent and 25 percent of its total sales will be electric by 2025 — depending on customer preferences, infrastructure development and the regulatory environment in each of the markets in which it sells vehicles, the company said.
In all, Mercedes-Benz cars has committed to investing €10 billion ($11.3 billion) in the production of vehicles and another $1.3 billion into a global battery production network. The global battery production network of Mercedes-Benz Cars will in the future consist of nine factories on three continents.
“We are on our way to a carbon free future mobility. While our all-new EQC model enters the markets this year we are already preparing the way for the next generation of powerful battery electric vehicles,” said Sajjad Khan, executive vice president for Connected, Autonomous, Shared & Electric Mobility, Daimler AG in a statement.
Still, consumers shouldn’t expect to see vehicles with Sila Nano’s technology until at least the mid 2020s, as automakers look to prove that the company’s battery technology meets their quality assurance standards. “The qualification time means there’s many years of work to make sure it is reliable for next 10 to 20 years,” says Berdichevsky. “Our partnership is geared towards mid-2020s production targets, but the qualification is something that takes quite a while.”
The company’s latest round brings its total financing to just under $300 million since its launch in 2011. And as a result of the latest funding, former General Electric chief executive Jeff Immelt will take a seat on the company’s board of directors.
“Advancements in lithium-ion batteries have become increasingly limited, and we are fighting for incremental improvements,” said Immelt. “I’ve seen first-hand that this is a huge opportunity that is also incredibly hard to solve. The team at Sila Nano has not only created a breakthrough chemistry, but solved it in a way that is commercially viable at scale.”
Powered by WPeMatico