Lidar technology firm Luminar has secured an agreement with Yorkville Advisors Global and another unnamed investor to provide up to $200 million in new funding through the sale of convertible preferred stock over the next eighteen months. The deal was disclosed this past Wednesday in a regulatory filing.
This new infusion of capital arrives amid a period of significant turmoil for the company, following the recent abrupt departure of its founder and CEO Austin Russell and the subsequent appointment of Paul Ricci, former chairman and CEO of Nuance, as its new chief executive and board chairman. Additionally, Luminar announced this month its third wave of layoffs since early 2024.
Under the terms detailed in the filing, Luminar will initially issue $35 million worth of convertible preferred stock to investors, with the potential to issue subsequent tranches of up to $35 million each, no sooner than 60 days apart. Each tranche would be sold at a purchase price equivalent to 96% of its stated value. However, Luminar is under no obligation to release additional stock beyond the initial issuance.
Luminar CFO Tom Fennimore emphasized in a statement that this transaction provides important financial flexibility and enhances the company’s balance sheet. “Our restructuring efforts have significantly improved our liquidity runway, and this capital further supports our strategic goals,” Fennimore said. Funds from the initial tranche will reportedly be allocated toward general corporate expenses and to retire existing debt obligations.
Notably, Yorkville Advisors Global is known for making similar investments in struggling publicly traded enterprises, having previously delivered financial lifelines to companies such as Lordstown Motors, Faraday Future and Canoo, the last of which eventually filed for bankruptcy.
Founded by Austin Russell in 2012 when he was still a teenager, Luminar emerged from stealth mode in 2017 and quickly became one of Silicon Valley’s most celebrated startups amid heightened interest in autonomous vehicle technologies. The company merged in 2021 with SPAC Gores Metropoulos Inc., achieving a post-merger valuation of approximately $3.4 billion. Since then, however, Luminar’s market capitalization has drastically declined to around $179 million today.
Despite early successes and an initial infusion of capital that totaled $250 million before its SPAC transaction, the past year has witnessed major operational cutbacks as Luminar moved to streamline operations in the face of challenging market conditions. During 2024, the company undertook two layoff rounds that ultimately reduced its workforce by approximately 30%—equivalent to 212 employees—with some cuts extending into early 2025. Another round of layoffs commenced on May 15 this year, expected to incur cash charges between $4 million and $5 million, and is projected to be accounted for over the second and third quarters of 2025.
