Following up on my post almost 2 years ago – fresh fundings are going to EV makers and autonomous driving.
The check sizes are big – you need billions of dollars to compete with the $800 billion Tesla.
1/ Microsoft + Cruise, $2+ billion
A new investor in the EV space – Microsoft (NASDAQ: MSFT) led the $2+ billion round for GM’s (NYSE: GM) Cruise, with valuation up to $30 billion. Microsoft’s Azure is getting the new customers: GM and Cruise.
Cruise, as a self-driving unit, spent $0.8 billion in operating cash flow in 2019.
At December 31, 2019, external investors held 17.3% of the fully diluted equity in Cruise Holdings. After this funding, GM should still have 77%+ of Cruise.
2/ Rivian, $2.65 billion
The financing is led by T. Rowe Price and the firm is valued at $27.6 billion. This is in addition to the $2.5 billion raised in July 2020.
3/ Lucid Motor, $2 billion (?)
It was reported (rumored) that Lucid Motor will go public via a SPAC deal with Churchill Capital Corp IV (NASDAQ: CCIV), which raised $2.07 billion last year.
The transaction could be valued at up to $15 billion.
CCIV share closed at $17.9 today, or 79% above its blank check ipo price of $10.
If pre-money Lucid is worth $13 billion, then buying CCIV at $17.9 is buying Lucid at over $23 billion.
There were a lot more others, with SPACs. To name a few others – Lordstown Motors (NASDAQ: RIDE) raised $1.175 billion; Luminar (NASDAQ: LAZR) raised $570 million; Fisker (NYSE: FSR) raised $1 billion, etc.
Plus, Apple will make EVs, Alphabet has Waymo, Amazon has Zoox and invested in Rivian. With Microsoft’s deal today and Tesla surpassing Facebook in market cap: now top 5 big tech in the US all have an EV play.
Takeaways:
1/ Cash might be abundant today – cash will be a competitive edge tomorrow.
2/ Covid-19 delayed most EV companies’ production for 1 year – that’s a gift for those who can produce – namely Tesla. The valuation jump includes the unexpected another year ahead.
3/ Top 5 big tech in the US all have an EV play.