Lost a €1.5 Billion Deal – Then Came the Series Order: Felix Pörnbacher (DeepDrive) Shares the Full Story

Five years of development, a lost €1.5 billion contract – and then, finally, the breakthrough: DeepDrive's electric motor is going into mass production for a global automaker. "For us it was the North Star, but it was never the finish line. It was always the starting line," says Felix Pörnbacher, Co-Founder and Co-CEO of DeepDrive, who joins Fabian on the Unicorn Bakery podcast for the second time.

In this conversation, Felix talks about what landing a series production order actually does to a company, how the team picked itself back up after losing a major contract, and why he believes every hardware founder should seriously consider China as their first production location.

The Road to the First Series Order

DeepDrive's pipeline consists of projects ranging from $100 million to $1.5 billion in contract revenue, spread across three to eight years. Once a contract is awarded, it typically takes another year and a half to two years before production actually starts – a long stretch during which industrialization, supply chain readiness, and manufacturability become critical, alongside the required lifespan of 300,000 kilometers.

DeepDrive took this reality seriously from day one: the company's fifth employee was a quality engineer. The underlying philosophy: act from the very beginning as if the series order already exists, rather than building quality processes only after the contract is signed.

The Defeat Before the Victory

Before the series order came through, there was a painful setback. Forty people spent three to four months working on a project worth €1.5 billion in revenue volume – and ultimately lost to an established competitor. Instead of sugarcoating the loss, Felix addressed it head-on in a company townhall: "It really sucks that we just lost this one."

That openness has become part of DeepDrive's culture. Everyone on the team knows the slide with the line "we're in the business of lucky shots" – five red crosses for failed attempts, one green checkmark for success. A constant reminder that in this business, setbacks are the rule, not the exception.

From Engineering to Execution

DeepDrive describes its current stage like this: 60 to 70 percent of the project's value has already been created, but only 20 to 30 percent of the actual work hours have been spent. In other words, most of the work still lies ahead as the company shifts from engineering to execution.

Concretely, that means around 30 BOM items (Bill of Materials), each backed by two to three suppliers. In the conversation, Felix also explains what A-, B-, and C-samples mean in practice – the different maturity stages a component goes through on its way to series readiness.

Organizationally, DeepDrive has structured itself accordingly: an engineering lab in Munich, plus "execution vehicles" for Europe, China, and – going forward – the US.

China, Robotics, and Capital

A central topic of the conversation is the comparison between Western and Chinese manufacturing. A production line in the West costs around €20 million and requires 18 to 20 months of lead time. In China, that drops to a quarter or a third of the time and cost. For Felix, this is precisely why every hardware founder should evaluate China as a first production location – not out of principle, but out of economic logic.

At the same time, DeepDrive is opening up a new business area: robotics is becoming its own business unit. Felix sums up the underlying logic in one sentence: "Every joint is an electric motor." The technology DeepDrive has developed for electric vehicles translates directly into robotics applications.

Financing logic is shifting too, now that there's a real order book behind the company. Instead of relying solely on venture capital, DeepDrive is now tapping into CapEx, working capital, and project finance instruments – financing options that only become accessible once there's a solid book of orders to back them up.

Takeaway

DeepDrive's story shows just how closely setback and breakthrough are intertwined in the hardware business. A lost €1.5 billion contract wasn't the end – it was part of the journey toward the company's first real series order. And as Felix emphasizes, that series order itself isn't a finish line either. It's the starting line for what comes next: execution at scale, expansion into China and the US, and a new playing field called robotics.