Deal focus: Momenta brings brains to self-driving cars

Momenta is barely a year old, but the autonomous driving software developer is already one of China’s most sought-after start-ups, having managed to go from prototype to application in a matter of months.

The prototype that the founding team – including three ex-Microsoft researchers – showed investors comprised a camera placed in front of a computer screen which was playing a car-racing game. It demonstrated how Momenta’s deep-learning engine can process images, locate buildings, vehicles and pedestrians, and position them in a 3D map in real time. The software has since been purchased by multiple automakers and auto components suppliers with a view to introducing it in real cars. 

“The company’s performance has exceeded our expectations,” says Ray Hu, co-founder of Blue Lake Capital, which led a Series A for Momenta in 2016 and re-upped a few months ago. “Its technology has been adopted by renowned auto players, validating our initial assumption that the team had the proprietary technology to compete with other players in the market.”

Last week, the company raised a $46 million Series B led by NIO Capital, an investment unit of Chinese electric-vehicle maker NIO. The round also featured Mercedes-Benz’ parent company Daimler, Shunwei Capital Partners, Sinovation Ventures, and Unity Ventures. Momenta expects to work with NIO and Daimler at the operational level in the future.

A handful of Chinese and US start-ups have created artificial intelligence (AI) software for autonomous vehicles. However, Momenta claims to differentiate itself in two ways: one, its software can process data generated from consumer-grade cameras, whilst others require expensive, high-definition cameras; and its technology can optimize the performance of a self-driving car faster and more accurately.

Self-driving technology is still nascent and no start-up has yet addressed every facet of the market. But in due course, they will be targeting the same customers, Hu says. Mercedes-Benz has promised to introduce fully autonomous cars within five years, while NIO plans to launch an autonomous electric vehicle by 2020.

Momenta will use the new capital to build out its AI capabilities, commercialize its visual technology and further develop its high definition mapping software. The company is also creating software for level-four autonomy driving, which means the car is fully self-driving in certain environments but it still needs a driver in the seat for emergencies. 

“Domestic carmakers such as BYD and Geely have taken market share from international players like Toyota and Ford over the past few years. Some are moving aggressively in terms of adopting new technology for assisted driving and collision prevention. Momenta can provide the technology they need,” says Hu. “Meanwhile, by working closely with NIO on driverless car models, we hope that Momenta can soon launch one or two models as a showcase.” 

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• Topics
• Greater China
• Technology
• Early-stage
• China
• automobiles
• Blue Lake Capital
• Shunwei Capital Partners
• Sinovation Ventures