BMW i Ventures 2024 Predictions

Last year was another fruitful year for BMW i Ventures. We invested in several innovative, fast-scaling startups shaping the mobility, supply chain, and sustainability landscapes, including Formant, Ascon Systems, MacroFab, AMPECO, DeepDrive, and Cyclic Materials, amongst others.

As we begin 2024, we expect more fundraising, innovation, and promising investment opportunities. Breakthroughs in the electrification of transportation, positive advances in AI and IoT, leaps in robotics, and more will help us advance our mission of building a sustainable future and changing the mobility game. Here are a few of our predictions as the year unfolds.

The VC landscape:

Continued uncertainty will drive lower valuations. Investors still need to determine the proper valuation. While startups will be held to a higher standard, mainly to showcase capital-efficient growth, investors will remain concerned about the right entry prices. VCs will factor in uncertainty through discounted valuations and downside-protecting measures such as liquidation preferences. If startups can meet the higher requirements, there will be no risk in securing the next fundraising round.

Investors will look to distribute market risk. New investors will likely syndicate more investment rounds to lower risk, fostering collaboration in the VC market as investors join forces and founders win several value-adding investors to their shareholder base. Nevertheless, syndicating a round comes at the cost of a more intricate and time-consuming fundraising process.

EV maturity and autonomy:

Maturation of EV business models. The electrification of vehicles came with new business opportunities to address changes in the customer buying journey and post-purchase experience. New ideas have matured from the early conceptualization stage to product-market fit. Companies built to scale with the maturing market will be successful.

Autonomous long-haul trucks will finally hit the road. 2024 will be the year that we will see an increased number of autonomous trucks without safety drivers operating on U.S. highways.

2024 will bring increased investment in EV battery raw materials: This year, domestic supply chains for EV battery raw materials will see significant investments, particularly as corporations diversify their supply chains and bring more production and manufacturing to the U.S.

Advances in AI:

AI will remain a catalyst for several applications. AI will drive the need for more efficient compute and spur more companies to move to the cloud. It will also drive operational improvements and product development competitiveness. For example, Generative design AI tools will help design products to accelerate time-to-market and create better-performing products. AI also will help improve the cybersecurity of large network traffic systems. Rather than analyzing 100% of the data, a strategic AI approach will achieve a secured network by analyzing only a fraction of the data.

Generative AI is more mature than expected. Despite Gartner placing Generative AI at the peak of inflated expectations, certain signs are emerging that the Generative AI market is a lot more mature than expected. The fact that OpenAI reached $1.6B in annualized revenue last year and certain Generative-AI startups are already scaling their revenues at neck-breaking speeds suggests an accelerated adoption rate compared with other emerging markets. While many startups in this space will not make it, many of the next big companies are already being minted in the Generative AI space.

Robotics Automation and IoT

Ubiquitous satellite-based connectivity will become a game changer. IoT use cases around the globe will benefit from satellite connectivity. IoT device-makers and smartphone manufacturers will enable always-on connectivity leveraging satellite technology so devices never lose coverage, even outside traditional cellphone networks.

Robotics across manufacturing will gain widespread adoption. Rapidly advancing AI will usher in a transformative era for robotic solutions. The integration of advanced AI algorithms into robotic systems, combined with ongoing hardware improvements and cost reductions, will propel autonomous robotics to new heights. The democratization of advanced robotics, fueled by decreasing input costs, signifies a pivotal shift towards a future where intelligent machines redefine industries and daily life.

About BMW i Ventures

BMW i Ventures is the independent venture capital firm of BMW Group, investing in startups defining the future of mobility, supply chain, and sustainability. The firm has made many successful investments over the years in companies such as Blackmore, ChargePoint, CelLink, Fox Robotics, GaN Systems, Plus One Robotics, Our Next Energy, Tekion, Xometry, and many more. BMW i Ventures invests in all stages from seed to growth with a focus on Series A/B.

More information can be found at: https://www.bmwiventures.com.

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