Innoviz — Takeaways About Our Fast-Growing Start-Up

Our portfolio company, Innoviz just announced a new round of financing of $65M, one of the largest fundraising ever for an Israeli start-up.

The new funding is an impressive vote of confidence in the technology and market potential of Innoviz by Magna International and Delphi, two of the world’s leading automotive solution providers (Tier 1). Moreover, it provides the company with the required capital to execute its ambitious product development and production ramp-up in the race to win the LiDAR market for autonomous driving.

Innoviz was founded about 18 months ago and quickly raised a $9M round of financing that was led by Vertex Ventures. The company has been growing ever since at an astonishing pace. It has:

• Grown its team of 5 co-founders to 75 employees, and counting;
• Showed a working demo after only 10 months at CES 2017;
• Developed 3 components that are the core of its product & filed numerous patents;
• Struck strategic partnerships with two leading Tier 1 partners — Magna International and Delphi;
• Worked intensively and closely with customers.

In many aspects, Innoviz is still an early stage start-up which needs to overcome many challenges. Nevertheless, there are already some takeaways from the company’s journey so far:

Team: Yes, we know it’s all about the people. The competition in Israel over top talent is stronger than ever. We held many discussions on whether the company can scale its team within the required pace without compromising on quality. Throughout last year, all of us at Vertex Ventures had the pleasure to hear from friends in the Israeli eco-system the same anecdote, “a friend of mine who is a top guy just joined your portfolio company — Innoviz”. This has assured us that the company is on track in recruiting a multi-disciplinary excellent team.

Don’t be afraid to speak with the big guys: Innoviz understood from day one that it can gain more than it would lose from initiating discussions with potential customers and strategic partners. In a market abounded with competing solutions, the company had to convince the industry that its Solid State LiDAR is indeed unique. This required revealing part of the “secrets” behind the company’s product. Understanding that the complexity of our technology is our best defense against competition, this has enabled the company to conduct these discussions and garnered it the genuine attention of some of the market leaders.

Short development cycles equal customers trust and interest: The big automotive vendors (the OEMs) as well as their Tier1 suppliers are very conservative. In order to gain their interest and trust, which has led to discussions about product specifications and critical features, the company practiced very fast development cycles. Each new version demonstrated significant progress over its predecessor in Innoviz’s product and increased the credibility of the company’s product roadmap and forecasts.

We are often asked why LiDARs are so important for autonomous vehicles. LiDAR provides the best high resolution 3D imaging of the vehicle’s surrounding in every weather condition, even when facing direct sunlight. With this in mind, we believe that LiDARs will become a critical part of a sensor fusion that feeds information to the brain of the autonomous vehicle. The sensor fusion will also include cameras (i.e. MobileEye) and RF Radar.

Innoviz can be very proud of its execution to date. The future of the company depends on its ability to keep the momentum and drive at the same speed and quality. The company is well positioned as a market leader and we believe they have what it takes to become the LiDAR industry golden standard.