Ford paid $65 million in a deal that was definitely not an acqui-hire.
Last Friday, Ford bought shuttle-van startup Chariot in an all-cash deal. But the price wasn't disclosed, so it wasn't clear whether this was a case of a distressed startup selling for a bargain-basement price, or Ford paying a solid price for a strategic fit into its long-term plans.
Turns out it was the latter.
Business Insider has since learned that the automaker paid $65 million, plus earnouts to make employees with stock options whole. The startup had raised only one round of $3 million after emerging from startup factory Y Combinator in 2015.
As one person familiar with the deal said, it definitely wasn't an acqui-hire, and investors are happy with how it came out.
Chariot offers beleaguered Bay Area commuters an alternative to the overloaded mass-transit system. The startup uses 100 Ford Transit 15-seat vans to serve 28 crowdsourced routes, according to Ford. Currently, the routes are based on demand from riders, but after the Ford acquisition, data algorithms will take over and, Ford says, allow trips to be scheduled in real time.
Chariot CEO Ali Vahabzadeh previously told Business Insider that the deal took shape over more than a year and half, then accelerated in recent months.
In addition to the Chariot acquisition — the first by Ford Smart Mobility, the company's future-of-transportation unit — the carmaker announced that it would collaborate with the bike-sharing service Motivate in the Bay Area to integrate its services into Ford's FordPass app. Users will be able to access pedal-powered transportation through Ford's GoBike feature in 2018, when the service launches.
GM has also been making aggressive moves in the transportation-tech space, investing $500 million in Lyft and buying autonomous-car startup Cruise this year.
Chariot investors included SoftTech VC, Semil Shah, Maven Ventures, Major League Baseball Ventures, and Winklevoss Capital, among others.