BMW i Ventures has launched a new $300 million fund with the timely theme of AI reshaping the way the automotive industry operates. And BMW AG's independent ventures want to be in the driver's seat.
The fund, announced Wednesday, will make early-stage investments in Series B startups in North America and Europe that work on agent and physical AI (a term that includes AI as applied to robotics and self-driving cars), industrial software, advanced materials, manufacturing and supply chain technologies. This third fund brings the firm's total capital under management to $1.1 billion.
The challenge, of course, is finding AI startups that aren't just riding on the hottest tech trend in decades.
“We always try to focus and move towards what the new trends are, not just for trends, but towards what will actually determine the future,” Marcus Behrendt, managing partner at BMW i Ventures, said in a recent interview with TechCrunch.
The company's previous funding reflects Behrendt's thinking. When BMW i Ventures launched its first fund in 2016, autonomous vehicles and digital technologies were at the heart of its investment strategy. The second fund of 2021 focused on startups working on sustainability and supply chain.
For Behrendt and managing partner Kaspar Sage, AI will not only be the next big trend, but also the foundation on which other technologies will be built. And ultimately, they said, they will change robotics, the way software is developed and the way cars are manufactured.
Sage, who is based in the company's Silicon Valley office, said some of the biggest opportunities are those that may seem mundane but have a bigger impact. As an example, Synera, a German company backed by BMW i Ventures, uses AI agents in its design and engineering process, Sage said.
Synera started as an integrated software company that helps engineers automate and streamline complex design workflows in industrial engineering. The company then built an AI agent on top of that platform, which already contained data about materials, sizing, and other engineering parameters, Sage explained.
“And what we get from this is crazy because we can basically shorten the process of humans interacting to make certain changes, say three weeks, and we can reduce that to minutes,” Sage said. “And when you think about it, that's a very powerful thing.”
The company continues to focus on other areas in which it has invested, including advanced materials and circular supply chains. Behrendt said the new fund's focus on AI could expand the toolkit for sustainability, rather than replacing it.
The company has not yet made any investments from this third fund. However, the second fund, which is being finalized, includes investments in a number of AI-focused startups, including five recent ones that the company is not yet ready to talk about. The company used the second fund for more than 35 investments in total.
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