German air taxi startup Volocopter plans to raise fresh funds from investors, its Chief Executive Florian Reuter said on Thursday, adding that a deal to go public via a special purpose acquisition company (SPAC) was one option.
Volocopter this month tapped investors led by U.S. asset manager Blackrock for 200 million euros ($239 million) in backing as it seeks certification for its battery-powered flying taxi.
"We expect to need more money in the future," Reuter said in an interview. "You can expect us to continue raising money going forward."
Reuter aims to bring the VoloCity air taxi into commercial service in the next two years, in a race with startups including U.S. rival Joby which plans to go public via a $6.6 billion SPAC deal.
Joby, which has partnered with Toyota Motor Corp and Uber Technologies, has announced it will merge into Reinvent Technology Partners in a deal expected to close in the second quarter.
SPACs are shell companies that float on the stock market and then seek a target to merge with. The structure provides a simpler route to public markets for venture capital-backed startups than an initial public offering - especially those that have yet to generate revenue and want to raise fresh funds.
TWIN TRACKS
Volocopter is pursuing a twin-track strategy with its drone-like aircraft, trialling a remote-controlled cargo lifter with logistics group DB Schenker, and developing a two-seater flying taxi of similar design for urban air transport.
In Germany, it faces a challenge from Lilium, a Munich-based air taxi startup whose fixed-wing design is more suited to longer, inter-city hops. Lilium has been reported to be eyeing a deal to go public via a SPAC.
Reuter described Volocopter as a technology leader but said he was aware of the risks of falling behind against rivals with strong financial backing.
"What's most important is that you always have enough funds to implement your strategy, full throttle," he said.
Asked specifically about whether merging with a SPAC was an option, Reuter said: "A SPAC is something that is is interesting, but it's not the only way. There are alternatives.
"We are exploring various routes to determine what is the best way forward for Volocopter. We do observe rumours, but we are not adding to the speculation."
This month's Series D funding round brought the total amount raised by Volocopter to 322 million euros, with investors Avala Capital, Atlantia, Continental, NTT and Tokyo Century coming on board. ($1 = 0.8375 euros)
(Writing by Douglas Busvine; Editing by Arno Schuetze and Keith Weir)
