Electric vehicle startup Canu announced on Tuesday morning that it would go public later this year with a valuation of $ 2.4 billion. It joins several electric vehicle manufacturers making the leap into public markets. Like other new entrants, Cano will use an unusual listing method that avoids the traditional initial public offering.
Canu’s unique strategy participates in its “skateboard architecture” form, essentially a flat chassis that includes all of the vehicle’s functional elements. This allows the bodies to be adapted for many types of applications, which canu refer to as “top hats”, can be made on the same type of frame. Cano states that this modular approach will allow the company to serve wider market segments at a lower cost.
Canoo also stands out for its planned subscription model, which it describes as month-to-month and “no obligation,” while also including maintenance, warranty and charging. Nikola plans a similar subscription model, but Nikola is primarily focused on commercial electric freight trucks and is expected to require more commitment from customers.
Canoo’s first vehicle, by contrast, will be a consumer-focused “lifestyle vehicle” called Canoo, due to launch in 2022. The vehicle is highly unusual, essentially a soft box that takes up the entire length of the chassis. . Canoo has said that this is meant to harness the future potential of autonomous driving, and some of Canoo’s concept designs show that the vehicle became something of a driverless rolling sedan.
The option of renting a consumer vehicle on a monthly basis would be quite novel for consumers, while leaning towards a broader trend for membership income assumed by entrepreneurs and investors. However, the no-compromise model also reveals specific risks if Canu’s products are depressed or consumers are trivial.
In lieu of an initial public offering of new Canoo shares, the car company will be acquired by the so-called Special Purpose Acquisition Company (SPAC), Hennessy Capital Acquisition Corp IV, which has raised funds for this purpose.
SPAC’s public listing method has already been used this year by electric vehicle startups Nikola and Fisker. In general, a listing on SPAC is faster than a traditional IPO, and the EV market in particular has entered a phase where market momentum appears to be on edge. Tesla, the category pioneer, has seen tremendous share growth in the past 12 months, culminating in the expectation that it will join the S&P 500. Other EV makers seem eager to build on that success.
Canoo was founded just two years ago, but it is not a rookie team. The company was founded after executives fled the chaos at Chinese-owned electric vehicle startup Faraday Future.
