The venture firm Fontinalis Partners was founded in 2009 as its leaders saw an opportunity for technological advancements to improve the way that goods and individuals moved.
“We felt strongly that, over the next several years, there was going to be a wave of innovation that would not only affect the automotive sector, but manufacturing, transportation, logistics, retail and other high-consequence industry,” said Chris Stallman, partner of Fontinalis Partners, in an interview with FreightWaves.
“Smartphone adoption, prior to 2010, wasn’t that high so when we first started, it was a time where a lot of the first business models [we invested in] were centered around urban transportation, ride hailing, car sharing and delivery services,” said Stallman of the company’s past investments that have had successful public offerings, mergers or acquisitions. These include Lyft, Postmates, Telogis, Ouster and nuTonomy.
On Thursday, the venture firm announced that it has raised $104 million for its third fund, Fontinalis III, to continue focusing on mobility opportunities ranging from seed to Series B funding.
Stallman explained that this fund will focus on a new frontier of indirect mobility themes that can create great value in optimizing the way that people and goods are moved.
“A lot of these technologies require advances in AI, machine learning, cybersecurity, semiconductors and a lot of the hard sciences, in order to create breakthroughs to improve how products are delivered to customers,” he said.
“We are not just investors in vertical companies like supply chain, industrial and auto technology, but investors in companies that serve a whole variety of different end markets.”
An example of these broader mobility-themed businesses is its portfolio company Tomorrow.io, a weather technology company.
“They are in the business of creating new datasets to better predict weather for big enterprises. Some of their customers, like a major rail operator, worry about things like crosswinds, which lead to derailments of train cars. They have logistics firms, airlines, even major league baseball teams that are all worried about being incorrect on their delays and cancellation decisions,” Stallman said.
Venture firm details: Fontinalis Partners
|Firm locations||Detroit, Boston and other remote locations|
|Investment team||Five partners, two principals, one associate and six venture partners|
|Number of investments to date||56 total investments: 24 seeds and 32 Series A and later stages|
|Areas of focus||Mobility themes including clean technology, e-commerce enablement, fintech, industrial, manufacturing and supply chain technology|
|Successful investment details||IPO: Lyft (NASDAQ:LYFT) and Life360 |
SPAC mergers: Ouster (NYSE:OUST)
M&A: Postmates’ $3.9 billion sale to Uber (NYSE:UBER), Telogis’ $900 million sale to Verizon (NYSE:VZ), nuTonomy’s $450 million sale to Aptiv (NYSE:APTV)
Upcoming: Turo planned IPO
|Committed capital to date||$270 million|
Stallman also explained that many of the original leaders of these first-generation mobility companies like Tesla, Uber and Lyft are creating an ecosystem of new companies looking to broaden the application of mobility technology.
“New developments are being built off the success of earlier ones,” he said. “We invested in a company called Unfolded.ai earlier this year. It is a geospatial technology that allows companies to overlay a lot of data onto a map and understand their data from a location context. The four founders previously worked together on the geospatial team at Uber. Uber was sitting on the largest dataset of mobility data in the world, and there were no tools available to analyze it. They were able to find a way to do so. … In May, they were acquired by Foursquare.”
With these new funds, the company is looking forward to investing in mobility applications like these including other themes like demand planning and forecasting, e-commerce technology, additive manufacturing, clean mobility and fintech.
“We are very interested in areas where mobility collides with other themes,” said Stallman. “Companies becoming more open to innovation will make these collisions much more frequent.”
Disclosure: Fontinalis led FreightWaves’ $3.4 million seed round and has been active on its board since.