
Luminar Plans $3.4B Reverse-Merger IPO - apsec112
https://www.thestreet.com/investing/luminar-driverless-car-producer-to-go-public-through-reverse-merger
======
cushychicken
Damn. Taking your company public in a multi-billion dollar SPAC deal at 25.
I'd barely figured out how to pay rent on time by that age.

------
Animats
For a company with no market? Yet another LIDAR company? Claiming to ship in
2022?

The whole automotive LIDAR industry is in a slump, because nobody is buying in
quantity.

~~~
pests
I really appreciate your constant LIDAR analysis in these posts. I always
expect to see a comment from you when posts are about self driving or lidar
advancements.

~~~
Animats
I'm all in favor of LIDAR, but I don't see what makes this company worth $3.4
billion as a public company. The investors are putting in $570 million.

Here's a list of the top players in automotive LIDAR: Delphi Automotive,
Continental, ZF Friedrichshafen, Infineon Technologies, Velodyne Lidar, Texas
Instruments Incorporated, First Sensor.[1] Not seeing Luminar on that list.

Their 2022 product seems to be yet another rotating scanner. 120 degree
horizontal field of view, 30 degree vertical. Possibly with some steering on
the vertical axis to deal with hills. Nice renders of the packaging. Why is
this worth $3.4 billion?

There are lots of other cheap LIDAR real soon now companies. Quanergy.
LeddarTech. InnoViz. Continental bought Advanced Scientific Concepts, which
had expensive solid-state LIDAR working well. Continental put that product on
hold because nobody wanted to order a few hundred thousand of them.
Continental is an auto parts maker, and they do volume products only. They
will sell you an expensive prototype if you want one. Delphi seems to be
taking a similar position.

[1] [https://www.marketwatch.com/press-release/lidar-for-
automoti...](https://www.marketwatch.com/press-release/lidar-for-automotive-
market-potential-growth-share-demand-and-analysis-of-key-players-research-
forecasts-to-2026-2020-08-13)

~~~
pests
I have definitely noticed a bias towards Continental in a lot of your posts.
Do you really think they have a leg up on the industry?

~~~
Animats
I liked the Advanced Scientific Concepts technology when I first saw it in
2003 or 2004 in Santa Barbara, when it was on an optical bench. No rotating
machinery. A later version is used by Space-X to dock the Dragon spacecraft
with the ISS.

Their device was very expensive because it required custom ICs made using an
unusual InGaAs process. But that's the kind of thing that becomes cheap when
production gets into millions. Continental is an auto parts manufacturer,
where every penny per part is carefully counted. If they thought they could
get the cost down in volume, they probably could.

But no market appeared. Continental appears to be able to make the things;
they have demoed and offer a prototype. Setting up an assembly line to bang
them out has to wait for a big order. Automatic driving isn't far enough along
to generate such orders.

Which is the big problem in all this. Nobody needs a million LIDARs yet.

------
csours
I understand Reverse-Mergers generally, but I don't really understand how the
money works.

?People? buy stock in an existing 'shell' company.

The shell company buys the target company and immediately re-brands itself as
the target company.

I guess I don't understand valuation and dilution and who has ownership after
the acquisition. It would seem that the founder would want to have a lot of
the stock (more than 50%), but the owners of the shell company would also want
to retain the ownership of their stock... Where does the stock come from for
equity for the founders and employees?

~~~
psanford
Matt Levine has been talking about SPACs a lot this year. Here's one of his
articles that gives a good overview of how they work (esp. vs an IPO):
[https://www.bloomberg.com/news/newsletters/2020-07-27/money-...](https://www.bloomberg.com/news/newsletters/2020-07-27/money-
stuff-spacs-aren-t-cheaper-than-ipos-yet)

------
gibolt
Lidar is almost always discussed in relation to self-driving vehicles.

What are some other applications that stand to benefit significantly from a
price reduction? Submersibles come to mind as a cost-prohibitive tech where
this could help somewhat.

~~~
hbcondo714
Augmented Reality apps. Apple includes a LiDAR Scanner in their latest iPad
that performs plane detection for AR object placement.

[https://developer.apple.com/augmented-
reality/arkit/](https://developer.apple.com/augmented-reality/arkit/)

~~~
michaelmior
I think it's a sign I need to go to bed when I read "plane detection" and
start wondering what airplane detection has to do with AR...

~~~
bigiain
I've been thinking idly about how to feed ADSB signals into the new Microsoft
flight sim so you could fly alongside real aircraft in real time...

------
jpm_sd
> All current Luminar holders will roll their equity stakes into the combined
> company , Luminar said.

Does this mean nobody is actually selling any of their shares?

Edit: Ah I got confused because this is called an "acquisition" but it's not
really an acquisition, is it.

~~~
apsec112
They may sell later, but not at the time of IPO itself. Often, there's a lock-
up period, where current stockholders are not allowed to sell to the public
until a certain amount of time has passed.

------
mrgordon
This is a copycat move following Velodyne going public in a reverse merger
with GRAF

I think Velodyne will do better as they have a larger market share and the
first mover advantage

------
sdan
Not surprising imo. There are a lot of lidar companies that have come out and
just like how self driving car teams/startups are almost required to be
strapped with an OEM or big co (torc with mercedes, zoox with amazong for
example), specialized lidar companies like Luminar and Ouster are pretty much
on a straight path to a merger or acquisition.

------
deepnotderp
Awesome stuff. I'm actually more excited to see what all the autonomous
vehicle compute and sensor stuff will be used for in different domains. Just
like cheap SoCs and MEMS from smartphones ended up being integral to the drone
industry taking off.

~~~
forgot_account
I see the applications/overlap with driving down the costs/size of multi-mode
precision-guided munitions: guided missiles and drones that use a mix of
laser, radar, and infrared sensing for all-weather accuracy. I'm not really a
hardware guy but I'd love to prototype something Spike-sized with COTS
sensors, then try to setup a factory in a developing nation.

[https://en.wikipedia.org/wiki/NAVAIR_Spike](https://en.wikipedia.org/wiki/NAVAIR_Spike)

------
enahs-sf
Can someone here please explain the motivation behind all these SPAC
transactions? Is it just to avoid the red tape and S-1 of IPO filing?

~~~
lmm
An SPAC lets the company negotiate a firm, fixed price, whereas an IPO is
(semi) exposed to the market. Of course that comes at a cost - the company
accepts a lower average price in return for reducing its risk. You can
understand why that has become a bit more appealing in the last few months.

------
supernova87a
How do we tell whether autonomous cars are actually making progress? Is this a
big bang final reveal, or is it possible to tell that every quarter, something
on the way to full autonomy is developing?

It seems that these spinoffs and acquisitions of Lidar companies, etc. all say
they solve a piece of the puzzle, but it still seems no closer to a real
system.

~~~
1123581321
Autonomous miles driven measures to a degree, but does not address concerns
about hardware being too limited.

------
person_of_color
Congrats, but is their LIDAR any good?

[https://www.reddit.com/r/SelfDrivingCars/comments/ifqzg7/com...](https://www.reddit.com/r/SelfDrivingCars/comments/ifqzg7/comment/g2r8zhe)

------
shinyFeature
> The CEO at Luminar, Russell, is 25. At age 17 he received a Thiel fellowship
> to build out Luminar.

Does the Thiel fellowship mean he dropped out of College? I am not familiar
with the founder but this feels odd and wrong to me given it's describing a
(technical?)founder for a autonomous driving startup? Fully autonomous driving
is a really hard technical problem and I believe you need a deep understanding
of many advanced topics understand the boundaries of this space, yet alone
innovate.

~~~
zitterbewegung
Yes, that was the point of the Thiel fellowship. It gives out grants if you
apply for people who decide to drop out / not go to college and pursue
something ambitious.

------
threeseed
Can we remove Thiel Fellow from the title ?

It's kind of annoying that startups are being defined by which investor did or
didn't write a cheque.

Founders deserve the credit for their startup's success not the VCs.

~~~
echelon
I think it's remarkable the CEO got an investment at age 17 and made it to an
exit.

Peter Thiel took a risk nobody else did.

~~~
threeseed
Taking a risk implies that you are going to be personally impacted if
everything falls through.

Peter Thiel is worth $2.1b and almost all VCs are investing institutional
money.

So I think it's ridiculous to even mention them in the same breath as founders
who are typically working 70+ hour weeks, dealing with immense stress and are
poorly paid for an idea that is statistically likely to fail.

