That funding round raised $40 million and was led by Blackbird, with Main Sequence also returning from an earlier round. Other investors in Baraja include Japan’s Hitachi Construction Machinery, Regal Funds Management, Perennial Value Management and industry superannuation fund HESTA.
At the time this took external capital raised by Baraja to $90 million, but it also announced an investment from automotive safety technology company Veoneer in January.
However, customers have slowed their development of new vehicles, due to tightening financial conditions, and Mr Collarte said it had decided to cut staff working on some of its existing products, to focus on new advances already in development.
The January investment was said to be aimed at helping Baraja further its development of new Spectrum HD25 technology, which it described in 2021 as a “generational leap” for automotive LiDAR.
“We did not take this [redundancies] decision lightly and are committed to providing support and assistance to those affected by these changes. We remain dedicated to delivering ground-breaking LiDAR technology to our customers around the globe,” Mr Collarte told the Financial Review in an email.
“With a change in industry outlook, Baraja has scaled back its legacy products to focus on its next-generation LiDAR. We’ve restructured the engineering teams in Australia and the United States to deliver Spectrum HD 2025, our high-volume low-cost automotive product built on Spectrum-Scan with breakthrough Doppler capabilities.”
Doppler refers to the Doppler Effect, which relates to how light waves change to alter the perception of nearby objects when the viewer is moving.
Despite also announcing an agreement to have its technology incorporated in vehicles by an unnamed automotive original equipment manufacturer late last year, revenue at the company has a long way to go to support the amount of research and development investment required.
Investor support
Blackbird Ventures partner Rick Baker, who is on Baraja’s board, said his firm remained a strong supporter of the company, and that the job cuts would give it the “runway” needed to deliver what he described as a very special piece of Australian technology.
“Unfortunately a number of factors have meant that Baraja couldn’t fund its full team going forward, this is predominantly driven by the slowdown in customer programs as autonomous vehicles take longer to roll out, and other vehicle manufacturers delay their next-generation programs,” Mr Baker said.
“At the same time, the global capital markets have become difficult for hardware companies that are still predominantly in the R&D phase.
“No founder wants to have to downsize their team. The human cost is real, and our thoughts are with those affected. We’re doing everything we can to help find new roles for them within our portfolio through our hiring programs.”
According to LinkedIn updates by some Baraja staff, the job losses came unexpectedly and were across a range of roles. These included senior technical staff and engineers, software experts, product managers, marketing and accounting employees.
Some staff members, who had come to Australia on skilled migrant visas linked to Baraja, also posted on LinkedIn about their urgent need to find alternative employment to stay in the country.
‘Tech wreck’
The job losses come as the Australian tech start-up sector recalibrates its expectations for external funding, as investors became more parsimonious after the first quarter of 2022.
A survey of Australian tech start-up investors by Folklore Ventures and Cut Through Venture on Tuesday found company valuations fell by an average of 29 per cent in 2022.
This and earlier research by KPMG and Techboard, led to venture capital investors warning local tech start-ups that they face a painful 2023, with a focus on profitability and capital efficiency replacing a previous thirst for dramatic growth.
Main Sequence partner Bill Bartee, who is a board observer at Baraja, said the company has built a world-class research and engineering team globally, but particularly in Australia, where a lot of those skills didn’t previously exist.
“Baraja has been a pioneer in developing next-generation LiDAR to enable full self-driving cars. Few Australian-founded companies have tackled a challenge so complex,” Mr Bartee said.
“In the past year, markets have changed drastically, both with start-up funding as well as broader strategy changes and consolidation in the automotive industry. That has necessitated a change in how Baraja is structured and its approach to market.”
