Rimac Group, the electric hypercar builder and new owner of luxury auto brand Bugatti, just secured more than $535 million in Series D fundraising, giving the company a valuation of more than $2 billion.
Based in Croatia, Rimac is best known for its all-electric hypercars, the latest being the Nevera, which produces 1,914 horsepower using four electric motors and is capable of a 0-60 mph time of just 1.85 seconds. It can race from 0 to 100 mph in 4.3 seconds and set a new world record, completing the quarter mile in just 8.582 seconds.
It’s the second infusion of cash the company’s gotten in the last two months, following the nearly $130 million from Investindustrial in April, plus $75 million from Porsche and a few others last summer. In short, the company’s hauled in nearly $750 million in new funds in less than a year.
Of course, it begs the question: what’s Rimac going to do with the new money? Plenty.
Starting with getting some breathing room from all the cash it has been putting out in the last few years. The company’s been in growth mode not only terms of its physical size, but also corporate structure.
Expanding the family
Last November, Rimac Group acquired French luxury carmaker Bugatti, and formed a new company: Bugatti Rimac d.o.o. The deal united a 10-year-old upstart automaker with a legendary brand with a product line dating back 110 years.
Officially, the Rimac Group is Bugatti Rimac’s majority shareholder with a 55% stake; Mate Rimac, founder and CEO of Rimac Group, retained his 35% share in that company. Porsche has a 22% stake, Hyundai Motor Group owns an 11% stake, while other investors hold the remaining 32 percent.
Rimac Automobili and Bugatti Automobiles will remain as unique brands with separate products. The company said development, production and supply of battery systems, drivetrains and other EV components will be produced by Rimac Technology, a new company fully owned by the Rimac Group. Mate Rimac will serve as CEO of both Bugatti Rimac and Rimac Technology.
Making a car safe is expensive
It’s been putting the Nevera through its final homologation paces so it can sell the electric rocket in the U.S. Crashing cars is expensive business and it’s been crashing them since 2019, ringing up millions of dollars in “research.”
“The Nevera was designed to excel in every area, with each component scrutinized and carefully engineered to deliver the best possible performance,” said Mate Rimac, the company’s founder and CEO, earlier this year.
“For four years now, we have been applying that same painstaking attention to detail to the safety of Nevera, with engineers working tirelessly on thousands of digital simulations and modifications to prototype vehicles, just to see their work destroyed during the crash testing process.
“All of their efforts have been absolutely crucial to the development of Nevera, and as this latest test concludes the Nevera crash-testing program, which brings us close to finally being able to hand over our next-generation all-electric hypercar to its first owners throughout the world.”
There’s no place like home
The company broke ground on a new global headquarters in Zagreb, Croatia last fall with a price tag exceeding $220 million. Not only is the company’s administrative home, it will also house its research and development and production base as well.
The cutting-edge complex will enable the company to ramp up from prototype and smaller volume projects to high-volume production of its high-performance electric drivetrain and battery systems for many global car companies, officials claim.
It will also serve as the production base for all future Rimac models and their key components, including the Nevera. The site will also house a test track and a museum and when at full capacity have 2,500 employees.
None of the above
The last round of investment, Series D, can raise a few eyebrows. Sometimes it means the company didn’t get as much as it wanted in its previous attempt to secure new equity and it’s convinced some new investors to put some money into the company.
That seems unlikely given the growth curve of the company and the companies involved in the latest round, especially SoftBank. If the name seems familiar, it should. The Japanese investment fund is heavily invested — at one point pledging $60 billion — in the auto industry, most recently having a large stake in Cruise Automation, the self-driving technology company, run by General Motors.
GM just bought out SoftBank’s stake in Cruise in March for $2.1 billion so that cash has to go somewhere. SoftBank has previously invested in ridesharing entities Uber, Didi Chuxing, Ola and Grab. However, the firm is dealing with its own issues with debt it needs to pay off. This leads to the next possibility: an initial public offering by Rimac.
Often Series D investors are looking to get a company over the hump, so to speak, to a stock offering, where everyone hopes to make some money. However, there haven’t been any rumblings about that and Rimac Group has a lot on its plate.
The funding could just be a good way for Rimac Group to stay private longer in order to get the Nevera to market, build the new headquarters and digest the acquisition of Bugatti.
