Autonomous vehicles can evolve to impact society in profound ways by challenging assumptions we have lived by for generations. This presentation (and the discussion it supports) will explore the new opportunities as well as the challenges of autonomous vehicles, from how they will impact individuals’ lives during early adoption to how they will remake the urban cityscape in the long term. We will explore the technology’s impact on the concepts of vehicle ownership, parking, travel planning, and other parts of our lives shaped today around humans at the wheel, as well as practical challenges to realizing the long term opportunities.

1. Autonomous Vehicles:
Impact and Opportunities
June 2014

2. 2
 Firelake Capital was founded in 2002 and has made 26 portfolio investments
across two funds
 We invest in technology solutions for resource efficiency
 Notable portfolio companies include:
– Kurion in high-value waste cleanup,
– Simbol Materials in raw materials for batteries,
– Bluwrap in fresh protein logistics,
– Airware in UAV software operating systems,
– Ruckus Wireless in urban high-density wireless bandwidth, and
– EOS Climate in carbon emissions mitigation

3. 3
Autonomous vehicle technology is rapidly progressing
DriverAssist ProactiveVehicle SemiAutonomous FullyAutonomous
Production
vehicles
Widely available today Toyota 2014
Mercedes 2014
Volvo 2014
Audi 2015
Volkswagen 2014-15
GM 2015
Mercedes 2014
Volvo 2015
Nissan 2015
Toyota 2015-16
Tesla 2016
GM 2020
Tesla 2016 (?)
Mobileye 2016
Google 2018
Nissan 2020
Mercedes 2020
BMW 2020-22
Prototypes
Volvo 2012 Google 2010
Mercedes 2013
BMW 2013
Volvo 2017
 Adaptive cruise
control
 Lane departure
warning
 Blind spot assist
 Emergency
intervention
 Stop-and-go traffic
assist
 Automatic parking
 Autonomous highway
driving
 Complex
environments
 All-weather
 Manual drive still
supported

4. 4
Critical factors aren’t keeping pace with core technology
development
Category Key questions / issues
Liability questions
 Represents a shift in responsibility for driving from driver to the vehicle itself
 Increase in manufacturer’s product liability may delay adoption
 Do the laws provide automakers with liability protection for third-party alterations
or unintended uses?
Legal issues
 How are autonomous vehicles defined?
 Can state law accommodate federal preemption?
Architecture and
technology
 Direct to Level 4 autonomy, or incremental steps? (we believe direct to Level 4)
 Laser scanner + cameras + other sensors; a sufficient approach?
 Cyber security concerns
Interactions with other
vehicles
 How will human drivers interact with other autonomous vehicles?
 Is Vehicle-to-Vehicle communications (V2V) required?
Interactions with road
and infrastructure
 Is Vehicle-to-Infrastructure (V2I) communications essential?
 Digital mapping detail
We believe the compelling benefits of autonomous vehicle technology will drive resolution to
these obstacles in a reasonable timeframe

5. 5
Most people focus on the safety-related benefits of the
technology
Autonomous vehicles have the potential to dramatically
reduce car-related crashes, injuries and deaths as they
 Have faster reaction time than humans
 Can see 360 degrees
 Are programmed to follow local traffic laws
 Never get distracted, tired or impaired
Cost of car accidents
 5.4 million accidents annually in U.S.
 50 million injuries and 1.2 million fatalities annually globally
 Most due to human error
 $160B overall cost
 #1 cause of death for 4-34 year olds

6. 6
TODAY FUTURE
However, the benefits of autonomous vehicles stretch well
beyond safety and represent a true revolution
 Hope you booked flight already ($$$)
 Go to bed early
 Wake up at dark-o’clock and find a taxi
to the airport
 Suffer through security screening, a
cramped seat on airplane and endless
rules, delays
 Rent car at destination and drive to
meeting
 Repeat above on way home
 Spontaneous decision to travel
 Request car via mobile app
 Enter destination, press Go
 Sleep
 Arrive at meeting in morning
 Return home at your leisure
Scenario 1:Travelling to a business meeting tomorrow morning 400 miles away
Today’s transportation reality is a series of steps fraught with stress and time wasting
activities – autonomous vehicles change this entirely

7. 7
Autonomous vehicle technology changes how we perceive
time and distance
 Plan ahead
 Visits compete for open weekends
 Time spent driving is lost
 Drive at most congested times
 Spontaneous decision to travel
 Can visit any day of week
 Can work or sleep, etc. while in transit
 More easily shift drive time to less
congested hours
Scenario 2: Ability to stay in touch with family or friends a three hour drive away
TODAY FUTURE
Today seeing people three hours away is a major event – autonomous vehicles allow for
more frequent interactions and enables closer relationships

8. 8
The ripple effects of the technology are vast
 Location is everything
 Defined by time lost getting places
 Public transportation favors only
certain areas
 Balance travel time, home size, price
 Housing market is efficient around this
 Meaning of “location” changes
 Time spent getting places is not lost
 Purchase decision rebalanced toward
immediate environs
 Major dislocation in home values
Scenario 3: Deciding where to live
TODAY FUTURE
Autonomous vehicles are like having door-to-door public transportation from
everywhere to everywhere

9. 9
Autonomous vehicle technology dramatically extends the
casual driving distance threshold
autonomous
vehicle overnight
autonomous
vehicle
car
horse

10. 10
Early Adoption – Impact at Individual Level

11. 11
Late Adoption – Impact at Scale

12. Peter Shannon
pshannon@firelakecapital.com