The German “flying car” startup Lilium is talking to investors in an effort to raise up to $500 million (€453 million) in a new funding round, sources told TechCrunch. Fundraising on that scale would mark the most capital yet raised by an air taxi startup, and could move the prospect closer to becoming a reality.
Lilium has already raised over $100 million in prior fundraising rounds, from investors including Tencent, Atomico, and Obvious Ventures. Even for small aircraft such as air taxis, development and certification can cost upwards of $1 billion, according to Avionics International.
Plus, companies like Lilium are relying on building and operating an entire fleet of aircraft, and gaining certification and regulatory approval for a concept that still may seem far-fetched to regulators and the public.
An executive from another flying car startup told TechCrunch that these hurdles lead to sustained costs over time:
“It’s a known secret how hard it is to raise growth rounds in this space because it’s such a new and untested market. Early investments were betting on the market vision and the concept of radically new mobility, but now it’s dawning on investors and others that it’s also a regulation play, and more.”
In recent years, the prospect of small, short-distance air travel has been proposed by startups like Lilium and Volocopter, as well as established companies like Uber, Boeing, and Airbus. Many have already made substantial progress, with successful test flights and the beginnings of pilot programs in early launch cities. Some are hoping to launch their first services in as little as three years.
Lilum announced its first successful test-flight of an electric, five-seat, vertical take-off and landing vehicle in May, following its success with a two-seat version.
Unlike many air taxi companies which are planning on very short distance trips within cities to bypass traffic, Lilium is focused on regional travel between cities and into rural areas. These longer trips could save more time and offer more value for travelers.
Lilium is aiming for a range of 300 kilometers, at 300 kilometers an hour. While other companies are working on models similar to drones or helicopters, Lilium’s aircraft resemble small, fixed-wing jets, allowing it to cover longer distances more efficiently.
A Lilium representative told Avionics International:
“We’re glad the world is getting as excited as we are about flying taxis, but we don’t recognize these numbers and we don’t comment on speculation regarding fundraising activities. Today our focus is squarely on putting the Lilium Jet through its paces on the airfield.”
Photo by Lilium