Mobility AI Startups You Probably Don’t Know but Should Watch in 2021
Self-driving companies get the headlines but these under-the-radar startups have great potential for investors
When it comes to artificial intelligence, self-driving and autonomous tech receive all the attention in the world of mobility startups. There are many companies in this space. Most have blockbuster valuations and headline glory. Argo AI, Waymo, Pony.ai, Zoox (check out this list) — you are probably familiar with all these names.
But some new companies are bringing machine learning, artificial intelligence, and predictive action to other areas of mobility, while others are indirectly powering self-driving technology. These startups are often hustling in the background, without the star-studded status of a Waymo or a Cruise. But there’s incredible value and growth potential with some of them.
Here are 5 startups with a slightly different flavor of AI that you should keep an eye on in 2021:
>> Cerence (NASDAQ:CRNC): This Burlington, Mass., company, founded in 2019, provides AI-enabled voice recognition software for cars. Cerence is a spinoff from Nuance Technologies — one of the pioneers of speech recognition software. You probably know Nuance from their Dragon suite of products.
Voice recognition in cars goes hand-in-hand with autonomy, as future vehicles will need to learn commands far more complex than “play Spotify” to help drivers keep their hands off the wheels.
True, Cerence faces stiff competition from the likes of Google. For instance, Ford recently chose the search engine company over long-time partner Cerence to power its in-car voice recognition.
But Cerence is also upping the game with its “conversational AI” software and continues to win business in new segments like EVs with customers such as Chrysler (Stellantis) and Volkswagen.
And unlike many of the self-driving players, Cerence has strong revenue growth and profit to boot — a key reason behind its strong stock price (up 300% in the last 12 months).
>> Rekor Systems (NASDAQ: REKR): At its core, this Maryland-based company provides license plate recognition technology. But its applications are where things get interesting. The information it gets from spotting cars is then processed by AI-driven analytics through a range of software suites.
For instance, Rekor’s OpenALPR platform can help drive-thru restaurants process orders more quickly or efficiently. Let’s say you order a coffee and bagel at your favorite Starbucks every day. Rekor’s technology can in theory notify your store when you are on your way so that you won’t even have to place an order.
That’s just one possibility. Mastercard has partnered with Rekor to explore such opportunities in predictive customer service.
Rekor is working with governments in traffic management and road safety as well. It also targets parking operators and law enforcement agencies to grow its customers.
Rekor’s stock has gained nearly 400% in the last 12 months based on strong earnings growth.
>> Recogni: This Silicon Valley company has been around since 2017 but it is steadily approaching escape velocity. Recogni builds AI-powered chips that drive vision recognition in autonomous vehicles — so in a sense, it is more of a “mainstream” AI company than the others on this list.
The company aims to increase and optimize the processing power required for data coming from various autonomous sensors (Camera, RADAR, Lidar, etc.). Faster processing is critical to AI development in self-driving vehicles.
“The issues within the Level 2+, 3, 4, and 5 autonomy ecosystem range from capturing/generating training data to inferring in real-time. These vehicles need datacenter class performance while consuming minuscule amounts of power. Leveraging our background in machine learning, computer vision, silicon, and system design, we are engineering a fundamentally new system that benefits the auto industry with very high efficiency at the lowest power consumption.” — RK Anand, CEO of Recogni.
Recogni faces off with the likes of NVIDIA and Samsung, but the company’s impressive roster of engineers and technical ideas have drawn strong interest from investors.
In 2019, it closed a $25 million Series A with Toyota AI Venture, BMW i Ventures, and several others. It upped the game to $49.5 million with a recent Series B. German parts supplier Continental also acquired a minority stake in Recogni with the aim of onboarding its technology to its vehicle platforms.
>>Tchek: This early-stage French startup brings AI to vehicle inspections. Cars need to be checked for damage and flaws at various stages — on lease returns, at car rental lots, service shops.
Tchek wants to disrupt this market, which roughly averages at 5 billion inspections per year globally, by automating the inspection process, reducing time and effort, and eliminating human error.
The company recently raised $3.6 million and is already working with rental company Europcar to test out its Tchek Scan technology. Europcar is using the technology to better capture damage on rented vehicles to increase operation efficiency and lower repair costs.
Acerta Analytics: Production flaws cost automakers time, money, and reputation. For self-driving cars, the stakes are even higher at the assembly line. As cars take more control away from humans, manufacturing errors can be catastrophic.
Acerta, a Canada-based company, has a simple but valuable premise. It uses AI to predict production defects. There’s potential in what the startup is trying to achieve. The barrage of sensors and software that future cars will require will make error reduction not only more critical but also more complex. There will be demand for solutions that companies such as Acerta are bringing to the market.
Acerta already has an impressive roster of customers. Ford, General Motors, Nissan are among the automakers working with this startup, which was formed in the engineering halls of the University of Waterloo.
“We apply AI to the data [that] manufacturers are able to collect during various stages of production and use it to predict earlier in the process whether the system is going to fail.” — CEO Greta Cutulenco, Automotive News Canada
Acerta’s solutions are not just applicable to the factory floor and production management. It is also using its AI capabilities to learn about software malfunctions in on-road vehicles, allowing automakers to learn about them and eliminate them in future cars or through software patches.
Acerta has some appeal to the industry. It closed a $7 million Series A funding in 2020 to expand in Europe and Japan. It has also increased demand for its solutions as OEMs and suppliers are looking at ways to cut costs and increase production efficiency.