As self-driving cars become a force on American roadways, Sherwin Prior is already looking ahead at new ways to leverage autonomous vehicle technology.
“You’re going to see it deployed in manufacturing facilities," says Prior, co-founder of VC investment firm Blue Victor Capital. “Where today, you see people driving around in those little trucks at the airport, you’ll see autonomous vehicles deployed. You’re going to see it in more commercial vehicles. And we’ll continue to work on autonomous cars.”
Prior was a pioneer at GM Ventures, the corporate venture capital arm of General Motors, where he managed over $250 million in assets to drive the growth of autonomous vehicle technology.
“Mary Barra, CEO at General Motors, has been famously quoted as saying, ‘There is going to be more change in the next 10 years than in the past 100.’ It’s absolutely true in the transportation space,’” he says.
Seeing the future
Prior and his business partner, Anish Patel, left GM to strike out on their own — in search of ways to continue disrupting the transportation industry.
“In 2016, the world changed, and the nature of my venture syndicates changed,” Prior says. “I had both oil and gas companies and insurance companies as strategic investors. It became really clear to people that the future of mobility and how people move from A to B would change quite dramatically. The impact was going to be so broad across many verticals.”
Both Prior and Patel have deep experience investing in in-vehicle mobility startups, having completed 22 direct investments, 12 exits and seven investments together.
“My job at GM Ventures was about seeing the future before the future was here,” Prior says. “It doesn’t feel like a job. It feels like a calling. The fact that I can bring people together and bring technologies to market or help people who create technologies — I’m not a technology creator. I’m a technology enabler through financing.”
One of the philosophies that drives Prior’s work is the idea that people — and companies — must be willing to reinvent themselves.
“I have a saying that some people find funny: ‘Many people believe they are talented. But few want to prove it,’” he says. “That applies to corporations. As part of GM’s corporate strategy development team, starting in 2010, we helped drive a message then that the auto industry was traditionally viewed as a pie divided by the major automakers. But it can no longer be looked at that way.”
The work continues
There is still much work that needs to be done to make autonomous vehicles ubiquitous. The Society of Automotive Engineers has an automation spectrum that goes from Level Zero, a car in which the driver performs all tasks, up to Level Five. At SAE’s Full Automation stage, “the vehicle is capable of performing all driving functions under all conditions. The driver may have the option to control the vehicle.”
Prior notes, “There are some real serious challenges to overcome for us to reach level four and five autonomy. You’re going to see a lot of emerging technology and software there. I’m specifically thinking about validation. There are millions and millions of miles that have to be driven to validate these technologies. And you see software companies that are developing validation tools for simulations that are going to be really important.”
Of course, it’s not only about vehicles on the road or at the airport or in a manufacturing facility and figuring out how to make them move safely. When you have something that is managed by a computer, you also have unsavory people who will try to hack into that network and try to cause harm to the users.
“It’s the industrial internet of things,” Prior says. “Think about the enterprise at your office. People are all using computers and there are IT folks who seek to protect it from intrusion. Manufacturing facilities are also connected to networks. They have to be protected. But we don’t see companies that traditionally pursue cybersecurity pursuing it on the manufacturing side. That’s going to be a key area.”
A new world
Venture capital investors eyeing transportation mobility will have many opportunities over the next 15 to 20 years to shape the future. And yes, there are concepts on the drawing board for cars that could eventually take flight.
“It has to be looked at as a continuum of transportation,” Prior says. “You’re starting to see more around vehicles/cars that can fly. That’s real. We’re going to pursue that, whether it’s Intel, GM Ventures or HorizonX, which is Boeing’s venture capital arm. You have to figure out how to monetize the movement of people or goods from Point A to Point B.”
Editor's note: Sherwin Prior will be one of the featured panelists at the Aspire Dealmakers Conference on April 11 at the Westin Book Cadillac in Detroit. His luncheon panel discussion will focus on NextGen M&A: How Mobility and AI Impact Dealmaking Activity, Decisions and Investments. Use code DEAL100 to save $100 on tickets.