Alibaba's Internet Car Startup Banma Raises $233 Million
Banma said this fundraising gave the company a valuation of over $1 billion.
Banma Network Technology Co. Ltd., co-founded by Alibaba Group Holding Ltd. (NYSE: BABA) and SAIC Motor Corp, has raised RMB 1.6 billion ($233 million) in its first financing round.
The fundraising was led by Yunfeng Capital, a Hong Kong-based venture capital fund co-founded by Alibaba's Jack Ma and other entrepreneurs. State-backed SDIC Fund Management Co. and SAIC Venture Capital Corp., an investment firm in Las Vegas, are the other two main investors in this round of financing, according to Crunchbase. Banma said this fundraising gave it a valuation of more than $1 billion.
Banma's CEO Hao Fei said the money raised would be used for hiring, investing in technology and upgrading its offerings.
Founded in 2015, Banma managed to enter the billion-dollar unicorn club in less than three years. Less than a year after it was founded, Banma launched China's first mass-produced so-called "Internet Car" – the Roewe RX5. Alilbaba's chairman Jack Ma personally introduced the car to the public, and said "it's a breakthrough embodying years of research and technological innovation."
"It is a product that demands the most secure and reliable end-to-end connectivity," said Alex Shi, ex-CEO of Banma.
The term "internet car" refers to the Internet of Things (IoT) where all devices are connected. Powered by an operating system called the AliOS, the Roewe RX5 controls the basic functions of the infotainment system, like navigation, radio, and smartphone integration.
The system also goes beyond connecting devices. It also helps recommend music or nearby restaurants based on data gathered during earlier trips.
So far, Banma has joined forces with Morris Garages, SAIC Maxus, Dongfeng Citroen, Qoros, Ford, and other carmakers. More than 16 car models, 500,000 vehicles being driven in China are powered by its unique operating system, the company said.
Banma expects its operating system to be used in 6 million vehicles in China by 2023, according to the South China Morning Post.