Recurrent, the Seattle-based startup that provides independent reports on the condition of used electric car batteries, has raised $3.5 million to power its business.
The seed round was led by Wireframe Ventures, with participation from PSL Ventures, Vulcan Capital, Prelude Ventures, Powerhouse Ventures, Ascend.VC and AAA Washington.
The startup officially launched in September as the first company to offer third-party reports on battery life and range of used electric vehicles to help car buyers with their purchase decision. Recurrent has more than 2,500 EV owners connected and providing data in exchange for receiving monthly battery reports for their cars. On the dealer side, the company has attracted 10 early-adopter dealerships so far.
CEO and co-founder Scott Case said the funding will be used to invest in the data science powering the reports. He said a big thing to watch for the company in 2021 will be the 3-year anniversary of the first release of the Tesla Model 3.
“On average, the first time a car sells in the used market is three to four years after it was originally sold new,” Case said. “The Model 3 was such a high volume vehicle when it first came out that sales of all used EVs in 2021 are projected to be almost double what they were in 2020.”
Case said that big increase in used supply is coming at the time when the majority of car owners in regions like the Puget Sound area say that they will consider an EV for their next car. He also said that the used car market in general has been on fire for most of this year as the pandemic and public health concerns associated with mass transit have driven people to shift to used cars.
Recurrent has collected over 1 million data points from the volunteer EV drivers who receive monthly reports. That massive, proprietary data set is used to train Recurrent’s machine learning algorithms and help the startup predict future battery life and range at the individual vehicle level.
Emily Kirsch, founder and managing partner of Powerhouse Ventures, said in a news release that her firm is excited about the potential impact of President-elect Joe Biden’s administration’s policies on EV adoption, including favorable policies in the European Union that could gain similar acceleration in the U.S.
Case said it all depends on what happens in the Georgia Senate run-offs in January.
“At the very least, we’ll see a return to higher fuel efficiency standards based on executive action, but there’s a lot more possible if the Democrats win control of the Senate,” he said. “You could see a Cash for Clunkers 2.0 program as an economic stimulus measure that creates strong incentives for taking combustion engine vehicles off the road and replacing them with EVs.”
Any momentum around making sure that EV-related incentives don’t just benefit wealthier buyers of new cars, but also benefit middle- and lower-income people who are more likely to buy used cars, would benefit Recurrent, Case added.
Recurrent is a spinout of Seattle studio Pioneer Square Labs and previously received $300,000 in the form of a convertible note from PSL Ventures, its venture arm. The startup employs four people full time and is looking to add four more in January or February.
