Article by Dana Olsen, PitchBook

It’s not exactly a secret that VC investment in the transportation industry is on the rise. Ride hailing companies and self-driving technology are among the hottest topics in the business world, and as the way people transport themselves and their things continues to evolve, the sector is likely to receive even more attention—and even more funding.

Autotech Ventures is betting that the automotive industry will continue to spawn valuable startups. The specialty VC firm, which focuses on companies in the ground transportation space, has closed its debut fund on more than $120 million. Founded by Quin Garcia and Alexei Andreev, Autotech Ventures already has a portfolio of six companies, including Lyft, in a ground transportation industry that the firm sees as being on the verge of a transformation.

“There are things happening really fast, the pace of innovation is accelerating, and it will have major societal impacts,” Andreev told PitchBook. “I think that within the next 10 to 15 years, we’ll see some pretty drastic changes in how people live, especially in metropolitan areas.”

In some ways, that transformation is already underway. The ridehailing sector is the perfect example of the widespread change taking place in how people move around their world. Uber, with its $68 billion valuation, is currently the most valuable private company in the world, and it’s not for nothing: The ridehailing giant recently hit the 5 billion mark in terms of total rides completed. Smaller rival Lyft, meanwhile (worth $7.5 billion) is now providing more than one million rides per day.

Autonomous vehicle technology is another niche area in the ground transportation sector that illustrates the industry’s potential. Self-driving vehicles are still far from commonplace, but activity in the space has steadily risen over the past five years, from just one deal in 2012 to 30 last year, per PitchBook data.