As the mobility industry continues to evolve, investors are finding more reason to get involved in the space and contribute to the momentum, says Komal Doshi. It’s a shift from the wait-and-see attitude that has limited growth in the past.
“Valuations are going higher for these mobility companies and that gives people the hope that because the impact is going to be so large, there is benefit in waiting for this long game,” says Doshi, director of mobility programs at Ann Arbor SPARK.
The global shared mobility market size is projected to reach $619.5 billion by 2025, according to a report earlier this year by San Francisco-based Grand View Research, rising at a compound annual growth rate of 25.1% during the forecast period. As smartphones and connected vehicles become more prevalent and the problem of traffic congestion in prominent cities worldwide continues to deepen, the market is expected to continue to expand.
“We have to think of better ways to move people that are more sustainable and more efficient,” Doshi says. “The impact is going to be very large. That's why it's an industry people are thinking more about now.”
We spoke with Doshi about the role dealmaking can play in building on this progress in the mobility industry.
At Ann Arbor SPARK, Doshi works with existing and new startups to identify and solve challenges, engage stakeholders and build relationships to advance the growth of the region’s mobility industry. She co-developed the Mobi Platform, a global platform for mobility entrepreneurs and industry players.
“The idea is how do we support innovation in the mobility space?” Doshi says. “How do we better connect our startups to big business, to opportunities within the public sector and to the testing facilities and all these great assets that we have in this area? How do we create a stronger mobility ecosystem? How can we develop Ann Arbor as a living laboratory for deploying these innovative technologies so that they can benefit the public?”
One of the limiting factors has been the newness of mobility and the reluctance of investors to lay out capital that may take a while to generate a return.
“A startup would often have to wait five to 10 years before they saw their product come to maturity,” Doshi says. “That would be too long to sit by idly without any revenue.”
Things are changing, however, as the industry puts products and technology on the road, making a tangible case for their value.
“There is more VC support, more angel support,” Doshi says. “There are grants now available that encourage innovation and partnership across sectors. There are new ways in which the private sector is interacting with the startups and with big business. Some groups are forming accelerators of their own. Some companies are doing more acquiring than they used to in a broader mobility segment. And in some cases, they have their own VC arms supporting innovative mobility technology.”
Motor City becomes Mobility City
Detroit has long been known as the Motor City. Now, it’s become a hotbed for the mobility sector with initiatives like the PlanetM program in Lansing and two testing centers: The American Center for Mobility and Mcity, which are both forward-thinking when it comes to transportation in the future, Doshi says.
It’s created a foundation for companies like May Mobility, an Ann Arbor-based company that builds autonomous shuttles for public transportation.
The company was founded in 2017 and has raised $33.6 million in funding over three rounds, according to Crunchbase.
“There was always the concern that since a lot of the capital was coming from the coasts, there would be an expectation for the company to leave the Michigan area,” Doshi says. “But thanks to the fact that the leadership was adamant that they wanted to remain in this region which has supported them and helped them grow and provides all the talent that they need in their backyard, as well as suppliers, they have not moved.”
May Mobility also formed a partnership with Bedrock, Dan Gilbert’s Detroit-based commercial real estate firm, to deploy the company’s autonomous shuttle in the city to serve a pressing need the company had in transporting people from the local park-and-ride to its offices.
Plenty of opportunities
The time is right for investors interested in doing business in mobility to take the plunge, Doshi says.
“Engage your local accelerators and programs,” Doshi says. “There are lots of events and conferences happening and these are great places to meet like-minded people and contribute. Startups always need help in every form and space. So if you have the knowledge to share and the time to share, get involved. It might just start with a cup of coffee and providing some guidance. But over the course of time, you might realize that there are companies out there that you feel as passionate about as they do. There might be more ways that you want to be connected with them than what might be apparent.”