Startups sell the best shovels in the mobility gold rush
Thursday 06 September 2018Article
My colleague Nic Farhi has previously discussed here that the real money in the rush to 'mobility' and autonomous vehicles might be made from those selling support services and infrastructure ("shovels") to the new ecosystem.
This is a bold strategic pivot in an environment where big gorillas with deep pockets (OEM, FAANGs, Uber) are throwing money at the wall and hoping a mobility/AV model will stick.
However and whenever this shakes out, those vehicles will still need financing, servicing, cleaning, fueling/charging, inspecting, repairing etc. These will tend towards natural winners at scale either in direct fulfillment or as enabling platforms where network effects drive consolidation.
Another innovative example is Zebra Fuel, bringing mobile re-fueling to business fleets in the UK.
Whilst it is exciting to see startups ambitiously going after this prize, the opportunity seems to be passing by some of the more traditional businesses that should have the existing infrastructure to flourish.
The most obvious candidates would be fleet leasing and rental businesses who have extensive networks and some OEM relationships.
Equally, dealer franchise groups have multiple points of physical presence and servicing capability that could be a key ingredient.
At a time of economic uncertainty, and as they grapple with their own risks/opportunities as car ownership changes, will they find the capital and bandwidth to respond to the challenge?
“What I think will happen over the long run — companies that can efficiently take care of their cars, minimize costs and be hyper-efficient will be the companies that win in the long run for mobility”
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