‘High risk, high reward’: VC firm with $1B in assets bets on driverless cars

Denver VC firm bets on driverless cars

Justin Borus is the founder and CEO of Ibex Investors. (Photos courtesy of Ibex Investors)

Justin Borus says we stand on the precipice of a mobility revolution powered by an invention that rivals the Wright brothers’ 1903 flyer in its ability to change the world.

“We see the electric driverless car as the biggest technological innovation of our lifetime, including the internet and, if you go back farther, including the automobile,” he said in an interview. “Intel has called it a $13 trillion opportunity. We think that is very understated.”

Borus, 46, is the founder and CEO of Ibex Investors, a Denver firm that this year surpassed $1 billion in assets and closed a $113 million Mobility Revolution Venture Capital Fund.

The fund doesn’t invest in driverless car companies; it invests in tech startups that might make driverless cars better. In Borus’ words, “We’re looking for the blue-jeans-to-gold-miners kind of businesses for the mobility revolution.”

The fund invested $6.4 million in a manufacturer of sensors for driverless vehicles, $4.5 million in a tech-driven trucking company and $3 million in an inventor of improved camera technology, among other investments. It’s a return-of-capital fund, meaning Ibex believes every investment has the potential to see a return of $113 million — the fund’s total.

“Really high risk, high reward kind of stuff,” Borus said.

Ibex HQ

Ibex Investors’ headquarters in Cherry Creek.

He added, “There is an appetite out there for a very small percentage of somebody’s portfolio to be something that is very high risk, high return. We would never recommend anyone allocate more than a very small portion of their portfolio to strategies like Ibex has.”

Headquartered in Cherry Creek with other offices in New York and Tel Aviv, Ibex was founded in 2003 and has specialized in Israeli startups for the past 10 years. A trip to Silicon Valley four or five years ago made Borus “an instant convert” to driverless cars.

“Once you go into a driverless car, it’s really a game changer. You’re going to have a 75 to 90 percent reduction in transportation costs, from insurance to gasoline to workman’s comp, combined with a 99 percent reduction in fatalities and injuries,” he said.

The future he sees is science fiction for now. Each vehicle will be a “living room on wheels.” Sports fans will have a recliner and flat-screen TVs in their cars. Fitness buffs, a treadmill and free weights. For businesswomen, a desk, chair and computer.

“This will be the biggest technological innovation of our lifetimes and how often do you get to say that and be a part of it and see it unfold in the next 10, 15, 20 years?” Borus said.

“And if we’re wrong?”

He paused for a few seconds.

“Sheesh. I hope we’re not.”