The Renault-Nissan-Mitsubishi automotive alliance has announced the launch of Alliance Ventures, a new corporate venture capital fund that plans to invest up to $1 billion to support open innovation over the next five years.
According to a press release, the fund expects to invest up to $200 million in its first year in start-ups and open innovation partnerships with technology entrepreneurs focused on new mobility, including vehicle electrification, autonomous systems, connectivity and artificial intelligence.
With further annual investments, Alliance Ventures is set to become one of the largest corporate venture capital funds in the automotive industry over the period of Alliance 2022, the strategic midterm plan launched last year by Renault-Nissan-Mitsubishi.
Carlos Ghosn, chairman and CEO of Renault-Nissan-Mitsubishi, says, “Our open innovation approach will allow us to invest and collaborate with start-up companies and technology entrepreneurs, who will benefit from the global scale of the alliance. This new fund reflects the collaborative spirit and entrepreneurial mind-set at the heart of the alliance.”
The press release says the new fund offers potential partners access to the global scale and scope of Renault-Nissan-Mitsubishi, which sold more than 10 million vehicles in 2017 through 10 separate brands with a presence in all major automotive markets.
Alliance Ventures will invest in start-ups to bring new technologies and businesses to the Renault-Nissan-Mitsubishi while ensuring a fair financial return, the release adds. The fund will make strategic investments at all start-up stages and will incubate both new automotive entrepreneurs and forge new partnerships.
The first deal by Alliance Ventures will be a strategic investment in Ionic Materials, a Massachusetts-based company that is developing solid-state cobalt-free battery materials. The equity acquisition coincides with the execution of a joint-development agreement with the alliance for the purpose of R&D cooperation. According to the release, Ionic is the developer of a pioneering solid polymer electrolyte that enables improved performance and cost effectiveness of high-energy density batteries for automotive and multiple other applications.
Alliance Ventures will be led by François Dossa, who has over 20 years of experience in investment banking, plus six years of experience within the alliance – most recently, as CEO of Nissan Brazil. The Alliance Ventures team will also draw on the expertise and business opportunities identified by a cross-functional team of experts from Renault, Nissan, and Mitsubishi.
Alliance Ventures will define innovation areas and geographic markets for investment, working with existing research and advanced engineering teams, and will recruit venture capital experts to develop the platform. It is expected to be co-located in Silicon Valley, Paris, Yokohama and Beijing, close to the technology and research centers of the Renault-Nissan-Mitsubishi alliance member companies, as well as to areas with strong innovation ecosystems.
Renault (40%), Nissan (40%) and Mitsubishi Motors (20%) will jointly fund the new entity, which will have a dedicated investment committee to make investment decisions and monitor their performance.
“This investment initiative is designed to attract the world’s most promising automotive-technology start-ups to the alliance,” says Ghosn.