Investors Hit the Brakes on Automotive Startups

Last year, Ted Serbinski called his accelerator, Techstars Detroit, the “‘comeback city’s’ startup ecosystem.” Since 2015, the accelerator had supported and mentored 54 transportation-related companies, with funding from some big transportation names, like Ford, Honda, AAA, and Nationwide…

But this year, Techstars Detroit won’t take on new startups. Instead, it’s shutting down, as earlier reported by TechCrunch. “Right now, there is no funding,” says Serbinski, the accelerator’s managing director. Part of the organization’s collapse is due to internal issues within Techstars, a global network of accelerators and itself a startup, Serbinski says. But the venture capitalist also blames trade winds within the automotive sector: a shift away from autonomous-vehicleinvestment and toward electrification, and a drive (no pun intended) toward less experimental businesses that can actually make money.