On Nov. 3, Einride officially announced its entry into the U.S. market through a pilot program with GE Appliances in Kentucky. While the company’s SAE Level 4 driverless Einride Pod has been running in Europe since 2019, the expansion into the U.S. is part of an aggressive push that company executives hope will transform freight movement on both sides of the Atlantic.
“The technology is here,” Robert Falck, founder and CEO of Einride, told Modern Shipper at the time. “It’s definitely happening as we speak. The GE Appliances installation is proof this can be done when society is [ready] to adopt this technology.”
In Europe, Einride is moving goods autonomously for Coca-Cola, SKF and Lidl. Since Oct. 1, 2020, Einride’s partners have seen a 90% decrease in carbon dioxide emissions with electrical transport, while matching the cost of diesel, the company said.
And that last part is important. Einride is building a sustainable transport future. To EQT Ventures, one of the company’s early backers, that environmental component is important.
“The electrification of trucking is one of the biggest transport improvements we can make in short order,” Ali Mitchell, partner at EQT Ventures, explained to Modern Shipper in a recent interview.
EQT Ventures is a diversified investment firm in Europe with over $500 million under management, Mitchell said. Importantly, about one-third of investments in its second fund are focused on companies working toward a more sustainable future. These investments cut across many sectors, including health, education, new energy and transport.
“Einride is probably the biggest breakout … in the [transport] space,” Mitchell said. He added that EQT was an investor in Wolt, a food delivery platform being acquired by DoorDash in an $8.1 billion deal.
It is those size of deals that EQT Ventures is hoping for when it makes an investment, Mitchell said, but when it comes to sustainability, the venture firm has a level of expectation.
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“We’re not investing in little tweaks here and there and dressing up software and greenwashing it,” he said, noting that EQT Ventures wants to find companies with passion and a plan.
“[Einride] is a great example of doing the right thing for the planet and the [right thing] for an investment fund,” he said.
Finding the right company is important, and in the case of Einride, the company’s approach fit EQT Ventures’ ideal.
“Sometimes startups get too far ahead of themselves,” Mitchell said. “Sometimes companies have a view of the future, but it’s 10 years from now and we need something right now.”
In the case of Einride, while the goal is a truly autonomous freight transport vehicle, the near-term goal is the electrification of the vehicle. Falck said that Einride’s Pods are designed to operate autonomously, but remote operators will monitor and help the vehicles navigate as needed. He said the ideal operation is 95% fully autonomous. The remote operator represents a new job opportunity, Falck said. The operator will provide the “decision-making” and when added to the power of autonomous, he believes “you have the best of both worlds.”
Mitchell addressed the competition Einride has in the race to electrify transport and ultimately produce a fully autonomous vehicle, but he believes the Swedish firm has the right approach.
“We looked at a number [of other investments] — there were a number of high-profile ones coming out of the U.S. — but they were focused on autonomy,” he said. “Einride is focusing on electrification first, autonomy second [and] Einride is winning the big customer contracts because what they want is electrification now and autonomy later.”
Mitchell also believes that Einride, which is building its purpose-built vehicle from the ground up, has an advantage over legacy truck makers such as Daimler, which must shift their entire business strategy from a diesel-focused business to an electric/autonomous-focused business. Consequently, these companies will have to sustain and manage two different business units to satisfy legacy products and new products, he noted.
As to the expectation of return on EQT Ventures’ investment in Einride, Mitchell said the firm’s typical expected timeline for an investment is eight to 10 years from the time of first money raised. He said Einride is expected to continue to win big contracts and there will likely be at least one more “very large funding round” in the near future.
Einride last raised $110 million in a series B funding round in May from first-time investors including Soros Fund Management LLC; Singapore’s Temasek Holdings Ltd.; Maersk Growth, the corporate venture arm of A.P. Moller – Maersk; and U.K. early-stage venture capital fund Northzone along with existing investors EQT Ventures, Plum Alley, Norrsken VC, Ericsson and NordicNinja VC.
Crunchbase reports the company has raised $152.3 million to date.
EQT Ventures has made 90 investments across its two funds, the second of which is $750 million, and has seen 13 exits so far, which Mitchell noted is a very successful rate for a fund.
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