What is driving the increased volume of auto technology deals? – Steve Greenfield

It has been quite an active year for mergers, acquisitions, and auto technology deals, and an even busier year for Automotive Ventures. On today’s show, we’re pleased to welcome Steve Greenfield, CEO and founder of Automotive Ventures. Greenfield advises founders, owners, and CEOs on mergers, acquisitions, and raising capital. He’s also the host of both CBT’s original series, the Friday 5 and Founder Focus.

Merger and acquisition activity has been on fire in almost every sector and the automotive retail space is no exception. In fact, maybe car dealers are experiencing record-breaking quarterly profits, which speaks to the resilience of the industry. Additionally, there are reports that automakers are starting to see a steady increase in the supply of semiconductor chips. All of these signs point to robust earnings for the remainder of the year from Greenfield’s perspective.

Digital retailing solutions are being swooped up by larger companies left and right it seems. Roadster was recently acquired by CDK Global and Gubagoo was sold to Reynolds & Reynolds, to name a few. Greenfield says that digital retailing is a trend that was steadily rising in popularity before the pandemic hit. Then, 2020 really accelerated the need for digital retailing solutions. Startups saw this as an opportunity to sell.

The question for average car dealers then becomes – how do I compete with the giants like Carvana, Sonic Automotive, or Lithia? Dealers need to maintain their relevance to consumers and offer a comparable experience. Digital retailing providers have benefited from this development and it has led to acquisition activity. In fact, approximately $1.2 billion dollars has been spent this month on digital retailing alone.

Greenfield’s venture capital firm Automotive Ventures has recently also raised a $7 million dollar round of funding. Backed by 67 investors, 21 of whom are dealer principals, Automotive Ventures aims to deploy investor capital into early-stage automotive companies. So far, Greenfield has made nine small investments (between $100,000 – $200,000) into very early-stage automotive or mobility startups, not limited to the U.S.

To find out more, check out the complete interview above.

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