Techpoint Charlie
Published in

Techpoint Charlie

Shaping the Future of Mobility

Insights from the Investor Panel at Autonomy's Funding the Movement Event

Last week, we flew to Paris for the Autonomy Summit & its Funding the Movement track. We got up at an unholy hour on the morning of the 18th to participate at the investor panel, which in just 45 minutes provided us with invaluable insights into mobility trends, differences between US and European markets, and how the automotive industry can participate in the future of mobility. This post will cover our main takeaways from the session.

Moderated by Florian Graillot, Founding Partner of Astorya.vc, the panel featured:

  • Stéphane Cobo, Corporate Innovation Manager at Groupe RATP, the world’s fifth largest public transport company
  • Gerod Carfantan, COO at Sente.link accelerator, a Chicago-based innovation program designed to scale high-potential mobility startups
  • Mark Paris, Partner at Urban.us, a NYC-based early-stage investment firm and the organizers of BMW Mini’s Urban-X accelerator
  • And Tanja Kufner, my boss, Partner at Porsche subsidiary MHP and Head of its investment and acceleration arm, dynamics.vc

Let’s dive in:

What are the investment trends in the European mobility sector?

The broader innovation themes lean toward platforms & services that seamlessly get people to their destination combining every mode of transportation available. The panelists also noted that cities and metropolitan areas will most likely own the multimodal mobility platforms, which signifies a need for services that will help them manage large masses of data.

The growing availability of intermodal transport options leads to a steady decline in personal vehicle sales. This indicates a shift from ownership to fleets, which is something OEMs need to start preparing for sooner rather than later.

How can traditional automotive companies participate in — or better yet — help shape the future of mobility?

The panel was quick to cite the 2017 McKinsey study on the startup investment ecosystem in the mobility sector, which stated that in contrast to overall funding activity in this area, OEMs are spending very little money on startup investments. Their VC spend looks even smaller when compared to total OEM R&D budgets. This is not exactly a huge commitment to supporting innovation.

On the surface, corporates are all about innovation. OEMs love to boast about working with startups, engaging in innovation ecosystems, running accelerators, and CEOs will readily approve pilot projects with startups. Getting to a Proof of Concept in a partnership is relatively easy, but implementing and scaling such a pilot into the core business makes it the CTO’s problem, which is where the biggest challenges arise.

Suddenly, a startup becomes a risky technology supplier and is subject to Procurement processes, Compliance & IT Security guidelines, etc etc. The challenges mount, the delays pile up, and the cooperation doesn’t seem worth the effort anymore. Instead….

What steps can corporates take to ensure successful partnerships with startups?

This question incited by far the most animated discussion in the panel — and the most attention from the audience. Everyone had something to add, but what’s clear is that the corporation needs to make the most compromises in the partnership in order to attract the best startups and allow their technologies to grow over time. It’s simple: the party that has the most to give should be the one to give the most.

Here are some of the best practices mentioned:

  1. Hack the corporate processes. I have heard and said this countless times. Create exceptions for all of the hurdles you can by going through the approval processes before even approaching a startup for a partnership. A great example of this in practice was by RATP Group. Stéphane Cobo said they were trying to test a startup’s technology on their infrastructure, but French regulations were preventing this so they leveraged their global presence and tested in the UK and Hong Kong, where no such regulations existed.
  2. Demonstrate the value of the partnership internally. In order to get complete buy-in from internal stakeholders, you have to be able to show the (potential) technological and economic value of the project. Show numbers, development and implementation roadmap, feedback from customers, etc. to reassure the board that the risk is worth taking.
  3. Manage expectations on both sides. No matter how high your rank or how long you’ve been with your organization, you won’t be able to magically wave away some of the hurdles. If a certain technology is completely banned by IT security, communicate this to the startup before they begin to develop the project. This will save effort, time, and money on both sides.
  4. Define the target market and KPIs for the partnership. Do not launch a collaboration unless you & your internal stakeholders have agreed on a market and a rollout strategy for the product you want to build with a startup. If there’s no organizational commitment or plan to see the partnership through in the long term, it’s not worth the trouble in the first place.
  5. Have a clear innovation strategy. Define what technologies you want to develop internally and differentiate those from what you want to do externally with investments and collaborations with startups. Set KPIs for your startup collaboration strategy and be accountable to see them through.

What are the differences between the French, German, and US markets in terms of mobility innovation?

It’s clear that Silicon Valley does not have a monopoly on innovation. That being said, if a startup from outside the US wants to scale, they cannot bypass the US market. Gerod Carfantan of Sente.link offered advice for mobility startups looking to expand into the US: you need to make your company attractive to American investors. The reality is, VCs in the US are more likely to invest in companies that have a Delaware incorporation.

Mark Paris of Urban.us noted that there’s a big difference in the priorities of VCs in the US vs. those in Europe: for American investors, the most important aspect of a potential investment is the team, whereas Europeans are more cautious and favor traction over anything else.

Just by walking around the venue and looking at the mostly French exhibitors, it’s clear that France is far more advanced than the rest of Europe on multimodal, shared, and electric mobility. Never had I seen so many different types of bikes, scooters, buggies, rollers, cars, and wheeled motorized everything.

Seriously.

In contrast to France, Germany, with its economic backbone rooted in the automotive industry, is less advanced when it comes to exploring new forms of mobility. It’s understandable though — when the reputation of your country is excellence in engineering, your automotive companies will want to maintain the highest possible standard for their cars. Excellence is expected by its customers, but it’s also a constraint on developing new products quickly. If OEMs want to keep up with the rapid pace of technological development, they have to look outside their own GmbHs.

Now what?

Dieselgate left the entire automotive industry reeling (rightfully so), and we’re still feeling the aftershocks. In Germany, the cultural shift away from driving your own vehicle will take more time, but OEMs are taking active measures to help shape the future of mobility by supporting open innovation. Our (grand)parent company Porsche is no exception.

Porsche is not only building their own CVC, they also partnered with Axel Springer to launch the APX accelerator, an early-stage tailor-made program, which is perfect for industry-agnostic founders who want to build and scale digital products. Porsche is also a longtime supporter of Plug n’ Play’s Startup Autobahn in Stuttgart, a garage-style acceleration program that is excellent for startups to get an introduction to the major players throughout the entire automotive supply chain.

And the final piece of the puzzle? To scale pilot projects with startups to more corporates clients, we’re building dynamics.vc with the support of Porsche subsidiary MHP, a management and IT consulting firm with over 300 clients across the mobility & manufacturing supply chain.

The future of mobility looks very promising indeed. It’s clear that for established automotive companies to participate in the innovation of the sector, they need to form partnerships and sacrifice process for progress to successfully co-create with startups.

--

--

--

A group of tech enthusiasts telling stories of the future of mobility, startup/corporate partnerships, and collaborative innovation

Recommended from Medium

Now Book LPG Gas Cylinder Using WhatsApp in minutes, Know the full process

Who will be cheaper, a car finance broker, or a car dealer?

Zero to One — A Short Review

Neutrinos capabilities in technology services

The future of vending Part 1

New Bing Features You Need in 2017 for Optimal Performance

The payments hyperloop: How open banking is creating a fast lane in the consumer payments journey

The Coolest Retail Stores In NYC Right Now

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Karina Schultz

Karina Schultz

Marketing @ SPREAD.ai 🚀

More from Medium

State of the Market: The Goalposts

Powering the Next Era of DNA-Enabled Industries

GridMatrix pitches as a finalist in Miami’s Inaugural Wyncubator Competition