Detroit startup Grounded secures $5 million seed funding and opens new manufacturing facility

Detroit-based Grounded has had to be flexible since it was founded in 2022.

The startup was initially built around the idea of customizing electric vans like Ford’s E-Transit and General Motors’ BrightDrop for the “van life” set, using a modular, “Lego-like” system. Sensing a bigger opportunity, Grounded then started customizing those vans for small businesses. But then GM discontinued BrightDrop last year, Ford axed plans for a next-generation electric Transit van, and EVs generally became a harder sell in the United States.

That hasn’t stopped Grounded. On Tuesday, the startup announced that it has closed a $5 million seed round, with repeat investments from existing backers Also Capital and Chicago-based early-stage firm The 81 Collection, along with Animal Capital, the Michigan Outdoor Innovation Fund, and “various SpaceX alumni,” according to founder and CEO Sam Shapiro.

Grounded has also opened a new 50,000-square-foot manufacturing facility in Detroit where it will take its core modular design business and scale it to be vehicle-agnostic, allowing the startup to customize fit kinds of fleet needs — be they electric or combustion-powered. Production at the facility starts this month, according to the startup, with capacity ramping up next year.

“This new facility is a turning point for Grounded,” Shapiro said in a statement. “We built this company to bring smart, modular electric vehicles to the businesses and institutions that keep our cities running. With this expansion, we can finally build at the scale our fleet customers need and bring our platform to an entirely new class of commercial vehicles.”

Grounded has already snapped up customers in the commercial (like Colgate and Nokia), medical (Wayne State University Medical and the Healthy Mothers, Healthy Babies Coalition of Hawaii), and even veterinary sectors. In a statement on Tuesday, Grounded’s chief product officer Nadia Meyer said the company is seeing “notable growth” from food and beverage and public safety customers, among others.

For Shapiro, GM’s cancellation of BrightDrop was a catalyzing moment. He wrote in a blog post late last year that Grounded would embrace gas-powered vehicles, allowing the startup to build on far more popular models like Ford’s combustion-powered Transit and Mercedes-Benz’s Sprinter vans. It also allowed Grounded to seek out customers who weren’t ready for electric vehicles due to infrastructure challenges.

Shapiro said at the time that Grounded would exhaust the remaining available BrightDrop inventory while it pivoted to new models, including leveraging electric and hybrid options from fellow startup Harbinger.

“Grounded is not an ‘EV company,’ nor is Grounded a vehicle company at all,” Shapiro wrote. “We build the smart, high-tech, modular workspace or living space on top of the chassis: the design, materials, power system, and Grounded+ software that turn a vehicle into a modern, connected mobile healthcare vehicle, command center, camper van, coffee shop, and more. The application layer on top of the vehicle is our product.”