Analysis
29 Jan 19

Start-ups moving into fleet telematics

The evolving telematics market is increasingly attracting new players, such as fleet telematics startups. Three dynamics demonstrate their growing importance and why you should care about them.

Investment of the automotive players

In their search for Telematics 4.0, OEMs are reaching out to startups. Jaguar Land Rover and Infiniti Motors (a subsidiary of Nissan) have even set up tech incubators dedicated to the connected car, in addition to the direct investment of OEMs in fleet telematics startups. The telematics startup Nauto, which develops V2X technology currently used in connected cars to detect collisions and track driver behaviour, for instance, received investment from BMW, GM and Toyota. Other key auto incumbent’s investment in fleet telematics startups from 2013 to 2018 according to CB Insights are GM’s investment in Telogis. Followed by Daimler who invested in Zonar Systems, which has been acquired by Continental. Volvo invested in Lytx and in Peloton Technology, a fleet telematics startup developing V2X technology used in truck platooning. The latter received investment as well from automotive companies Denso and Magna. Volkswagen invested in Ekoio and Porsche invested in Inrix, while Infiniti invested in Katsana, Carforce, and Roadlaunch. 

In 2017, according to CB Insights, 43% of the invested money of car makers in the private market went to startups dedicated to fleet telematics software, which was more than to any other category.

Interests of the telematics sector

The fleet telematics startups don’t stay under the radar of the telematics sector either. Three years ago, the Telematics Conference SEEurope was even preceded by a telematics startup conference. The conference was dedicated to startups working in the fields of telematics for fleet management and commercial vehicles, vehicle tracking, fuel, route and fieldwork optimisation, connected vehicles, transport, logistics, embedded solutions, maps and navigation, smart sensors, M2M solutions, IoT, smart cities, LBS, connected cars, and big data in transport. These are more or less the categories we find active telematics startups in. 

Telematics leaders reach out to smaller companies in order to reassure their position, or in the case of the acquisition of Fleetcarma, specialised in electric vehicles telematics, by Geotab, the telematics leader, to obtain a leading position in the changing mobility landscape: electric and connected vehicles.

Other funders gazing on telematics startups

Besides OEMs and telematics companies, the auto insurance industry is gazing at the telematics startups as well, because they consider them as market disruptors. 

Cambridge Mobile Telematics Inc., for instance, received $500 million in funding from the SoftBank Corp’s Vision Fund. The eight-year old startup uses smartphone data in order to analyse the behavior of drivers on the road. Its products are therefore aimed primarily at insurance firms, in order to perform their pricing based on measuring customers’ driving performance. The DriveWell platform provided by the startup is already used by insurers, vehicle fleets, wireless carriers and others to promote and enhance driver safety.

In the end, startups are getting more involved with the evolving telematics market; in order to keep theirselves in the running, already positioned players, such as the OEMs, the telematics companies and the car insurance companies for instance, have to collaborate with them and hence will increase their influence. 

One of the telematics startups to watch is the Australian-based startup OviDrive

Authored by: Fien Van den steen
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