Rivian investors explain why the startup's tech, Amazon deal, and management team make it a serious contender to become the next Tesla

An investor in Tesla, T. Rowe Price has been looking for EV companies with similar potential and was impressed by Rivian's technology and management, said Joe Fath, a portfolio manager at the financial-services firm.

"They're keeping their head down, and they're focused on building a real, durable business over time," he said.

The centerpiece of Rivian's tech is its EV platform, which includes its motors, suspension, and battery pack. Rivian says that platform will help the R1S and R1T achieve ranges of up to 400 miles or more between charges, up to 750 horsepower, and the ability to accelerate from 0-60 mph in three seconds. But strong performance is only part of the platform's appeal, Fath said. It's also at the center of Rivian's deals with Amazon and Ford, which plans to use the platform in one of its own vehicles.

That two-sided business model, as well as the company's financial resources and relative maturity, separate Rivian from its startup competitors in the EV industry, Fath said. According to Pitchbook, Rivian has raised $6 billion since it was founded in 2009. That's more than any other EV startup that hasn't gone public.

But Fath said the excitement Rivian has generated in its pre-production stage hasn't inflated the egos of its management team, which is led by CEO RJ Scaringe. Scaringe and Rivian's other executives are thoughtful, humble, and detail-oriented, Fath said; they understand where innovation can give them an edge (vehicle technology) and where it's better to follow the auto industry's best practices (manufacturing). And, Fath said, if you ask them a question about a specific number in their financial projections, they'll be able to explain it in detail, in contrast to the many companies that are less rigorous about their financial modeling.

"They've got every detail dialed in," he said.

While it remains to be seen if Rivian can handle the challenges of automotive production, Fath believes Rivian and other EV companies could eventually become more profitable than traditional automakers since EVs have fewer components than gas-powered cars, and EV companies don't have the expensive labor commitments some legacy automakers have built up over time.

"Once they reach scale," Fath said, "Tesla, and Rivian coming behind it, will have better margin structures than the traditional OEMs and better returns on invested capital."

The R1T and R1S will fill a hole in an EV market that doesn't yet have many SUVs and pickup trucks, Hassan Jameel, the deputy president and vice chairman of Abdul Latif Jameel's Saudi Arabia division, said in an email.

Abdul Latif Jameel was one of Rivian's earliest backers, first investing in the company in 2012. It saw in Rivian the possibility of major innovation.

"Taking the time to really understand the automotive manufacturing process allowed us to recognize Rivian's ability to create efficient and agile processes alongside cutting-edge technologies, which we believe have the potential to transform the industry," Jameel said.

Like Fath, Jameel praised Scaringe, citing his deep understanding of the auto and energy industries, long-term perspective, and humility.

"When I first met RJ in 2011, he was a 28-year-old entrepreneur who stood out as extremely knowledgeable and capable," Jameel said. "He continues to impress me every day."

A representative for Soros Fund Management said in an email that while the investment firm believes the EV market will grow large enough to support many companies, Rivian's vehicles offer a unique driving experience. The representative also highlighted Rivian's partnership with Amazon, saying it will demonstrate the financial and environmental advantages of EVs for fleet operators.

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