CloudCar Raises $15 Million in Latest Funding Round Led by Jaguar Land Rover
【Summary】CloudCar, a Palo Alto-based startup that specializes in cloud services for automotive businesses, announced earlier this week that it completed a $15 million “minority” investment with the British automaker.
A common practice by large companies across almost all top-performing sectors is backing or acquiring startups with the intention of leveraging the target's technology; and as a result, boosting their own products in the process. Examples of this classic strategy in action includes Twitter's acquisition of Vine (2012), fintech powerhouse Stripe's investment in Stellar (2014) and Jaguar Land Rover's sole participation in a venture funding round with CloudCar.
CloudCar, a Palo Alto-based startup that specializes in cloud services for automotive businesses, announced earlier this week that it completed a $15 million "minority" investment with the British automaker. Founded in 2011, the startup is a symbol of where the auto industry is headed in the next decade: the cloud and machine learning.
With this in mind and considering that Jaguar Land Rover's parent company is India-based auto manufacturer Tata Motors (more on this later), why did the British brand invest in CloudCar?
Connected Cars and Machine Learning
Jaguar Land Rover is interested in making cars smarter. In 2016, it launched InMotion, an independent venture that focuses on developing and testing apps, services and platforms for connected cars. The company has repeatedly expressed its interest in modernizing its vehicles for tech-savvy customers. In order to do this, it needs a strong, reliable cloud network – where all of the processing, passing of data and storage takes place. Furthermore, the cloud is the core foundation of internet services in today's smart cars.
CloudCar is capable of delivering all of these requirements and more. As the name of the startup suggests, almost all of its services are either based in or related to the cloud. But Jaguar Land Rover could easily build and scale a cloud network on its own without help from CloudCar – if it wanted to. So going beyond this, it seems that the British automaker is also interested in the establishment's machine learning features. The startup's machine learning capabilities include Natural Language Processing (NLP), which allows drivers to initiate requests via human speech without needing to fiddle with the touchscreen panel. For customization and integration, CloudCar also provides software development kits (SDKs) for automakers.
As mentioned earlier, Jaguar Land Rover's parent company is Tata Motors. The Indian automaker is part of Tata Group, a $100 billion conglomerate that is also the parent company of Tata Elxsi, a publicly listed design firm. Tata Elxsi recently made headlines in the driverless car space for seeking permission from local transportation authorities to test autonomous vehicles on public roads. The company's prototypes are repurposed units from Tata Motors, which is heavily developing driverless technology. It is very likely that Jaguar Land Rover's investment in CloudCar came to fruition partially due to Tata Motor's interest in boosting its own cloud-based network for connected vehicles.
"CloudCar has been working with premium manufacturers on some of the most exciting opportunities and challenges in the fields of machine learning and infotainment. This investment is integral to Jaguar Land Rover's vehicle technology programme: but the programme also presents an invaluable opportunity for other automotive manufacturers to get involved," said Executive Director of Corporate Strategy for Jaguar Land Rover, Hanno Kirner.
Michael Cheng is a legal editor and technical writer with publications for Blackberry ISHN Magazine Houzz and Payment Week. He specializes in technology business and digesting hard data. Outside of work Michael likes to train for marathons spend time with his daughter and explore new places.
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