Investors Aren’t Putting The Brakes On Auto Safety Investment

We’ve been driving cars for over a century. But still, humanity hasn’t mastered the task of getting around town without causing undue death and injury.

Around 1.35 million people lose their lives on the world’s roads every year, per WHO estimates, and as many as 50 million suffer injuries. The organization calls it “an unacceptable price to pay for mobility.”

Startups concur. And while technology alone won’t save us from poor driving, founders are working on a range of innovations that could make a definitive difference in reducing the incidence and impact of accidents.

Investors are on board as well. Demand for enhanced automotive safety has driven a wave of funding in companies focused on the space in recent years. The sector is also producing exits, including Qualcomm’s acquisition this week of Autotalks, a maker of chips used in crash-prevention technology.

To get a sense of the scope of investment, we used Crunchbase data to curate a list of funded companies working on vehicle and road safety technology that have raised capital in the past couple years. The resultant list includes 11 companies, including Autotalks, that have collectively raised over $2 billion to date.

Large funding recipients

By far the most heavily funded startup in our sample set is Motive, a San Francisco-based provider of fleet management technology employing Internet of Things hardware and artificial intelligence. Its offerings include an AI dashcam that provides automated coaching to correct unsafe driving habits as well as tools to track compliance with safety regulations.

Ten-year-old Motive (formerly KeepTruckin) has raised over $567 million to date, per Crunchbase data. Its most recent financing, in May 2022, was a $150 million Series F led by Kleiner Perkins and Insight Partners.

Others are raising large sums with an eye toward improving safety in autonomous and semi-autonomous vehicles. Prominent among these is TTTech, an Austrian company that develops hardware and software aimed at improving safety for autonomous mobility. Last year the company closed on a $274 million round backed by Audi, a longtime partner.

Most recently, Phantom Auto, a software company focused on safety for remote operation of logistics vehicles, raised a reported $25 million in April from corporate investor ConGlobal.

Not everyone’s into self-driving, but safety is an easy sell

The wave of safety-related investment coincides with the realization that commercialization of fully autonomous driving technology has not proceeded at the speed early boosters had hoped. While vehicles today have ever-more sensors and technology to detect risks on the road, humans are still overwhelmingly behind the wheel.

In contrast to fully autonomous autos, tech to improve safety of human-navigated vehicles seems to be a much easier sell.

Qualcomm, for one, seems to see enough profit potential to shell out a reported $350 million to $400 million for Autotalks. It pitched the purchase as a way to gain market share in so-called “vehicle-to-everything communication technologies,” which it says will “play an increasingly important role as they become critical sensors for automotive safety systems.”

Mobileye, known for its advanced driver assistance systems, as well as autonomous driving technologies, has also met a welcome reception on Wall Street. Shares are up since its Nasdaq debut in October, with the company recently sustaining a market cap around $33 billion.

Success here isn’t  just about profits

However, auto safety is one of those areas where startup success isn’t only measured in big exits and investment returns. The best outcome for all involved would be to see technologies contribute to meaningful reductions in roadway injuries and fatalities. I’ll take that over a massive IPO any day.

Illustration: Dom Guzman

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