Samsung Electronics aggressive investments in automotive startups trigger M&A possibilities in self-driving


Samsung Electronics has been making made large and small investments in startups for its overseas automotive (electronic equipment) business and is making rapid moves to secure related technologies such as self-driving. Industries are paying keen attention to whether Samsung Electronics’ move will lead to more M&As (merger and acquisitions) in the automotive field.

According to the industry reports on the 17th March, Samsung NEXT has invested in Israel’s automotive startup Brodmann17, which raised $11 million (about 1.25 billion KRW) in Series A funding recently. The exact amount of Samsung NEXT`s investment has not been disclosed, but the industry estimates it is worth millions of dollars.

Broadmann 17 is a company that specializes in developing Advanced Driver Support System(ADAS) based AI (Artificial Intelligence). It accurately recognizes surrounding situations through AI-based Deep Learning. Samsung NEXT had made a small investment in AI two years ago.

Samsung Electronics has been steadily paying attention to automotive businesses through its subsidiaries such as Samsung NEXT since it established the Automotive Innovation Fund worth $300 million (340 billion KRW) in 2017. There are about 10 companies under the fund including TT Tech (the U.S., 100 billion won), TetraVue (the U.S., 11.5 billion won), Solid Power(U.S.), AI Motives (Hungary), and Mapillary (Sweden).

Due to its pre-emptive investment effect, Samsung Electronics is ranked second (1152 cases) in the list of patent applications for self-driving technologies worldwide last year. Although Ford (1225 cases) ranked first, Samsung is the highest ranking for non-car manufacturers. 

“We will invest in venture companies that seek innovation and find new opportunities for growth,” said David, CEO of Samsung NEXT. “This is a win-win strategy for those companies and Samsung NEXT,” hinting at additional investment and M&A possibilities. 

In the case of Israel’s startup Corephotonics, in which Samsung Electronics invested $150 million early this year, it received millions of dollars in 2017. LoopPay, the predecessor of ‘Samsung Pay’ that was acquired in 2015, was also introduced to IM Business Department and M&A was established.

“It is clear that Samsung Electronics is going to develop its automotive field.” said a representative for the industry. “It will not only be looking at global partners but also M&A strikeouts are going to be considered.”

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