Arc Raises $50M Series C to Scale Electric Boats and Marine Propulsion Systems

Two engineers looked at water and saw a battery problem hiding in plain sight. Mitch Lee and Ryan Cook were never chasing marginal gains on propellers or polish on legacy designs. The question they leaned into was sharper and a little uncomfortable for an old industry. What happens when a boat is treated like software with a hull instead of hardware with a gas tank.

Arc just pulled in $50M in Series C funding, and the money did not drift in quietly. Eclipse showed up again, alongside Andreessen Horowitz, Menlo Ventures, Lowercarbon Capital, Necessary Ventures, and Offline Ventures. That is not tourist capital. That is a table full of firms that understand timing, infrastructure, and the difference between a cool product and a category shift. Total funding now sits around $154.25M, which tells you this is not a side project. This is a build.

Arc is not selling boats the way legacy players sell boats. They are building an electric backbone that happens to float. Batteries, powertrains, thermal systems, software, all built in house. The Arc One proved people would pay $300K for electric performance on water. Limited run, sold out, done. The Arc Sport followed and kept the momentum, already sold out and moving into scaled production. Not hype, not theory, just demand showing up early and loud.

Then the commercial side hits, and the story gets heavier. A $160M contract with Curtin Maritime for 8 hybrid electric tugboats. Each one pushing over 4,000 horsepower with a 6 megawatt hour battery buffer. Ports like Los Angeles and Long Beach are not experimenting, they are preparing for zero emission realities. Arc is not pitching the future, they are wiring it into vessels that will move a third of the country’s waterborne goods.

The play here is clean if you know how to read it. Start high end, prove performance, lock in brand. Then scale into systems and infrastructure where margins stack and contracts stretch. Mitch Lee brings the operator instinct from building and exiting before. Ryan Cook brings the discipline of SpaceX level engineering where failure is not a rounding error. Together, they are not guessing. They are sequencing.

What stands out is not just the capital or the contracts, it is the vertical integration. Most companies assemble. Arc composes. That difference is where control lives, where margins hide, and where defensibility gets real. When your software updates improve a boat already in the water, you are not just selling a product, you are extending a relationship.

The marine industry has been slow to change because it could afford to be. Regulation is tightening, fuel economics are shifting, and expectations are catching up. Arc is stepping into that gap with timing that feels less like luck and more like pressure meeting preparation.

Big respect to Mitch Lee and Ryan Cook for building something that does not just ride the current, it changes it midstream, and to Eclipse, Andreessen Horowitz, Menlo Ventures, Lowercarbon Capital, Necessary Ventures, and Offline Ventures for backing a company that understands the difference between floating and actually moving forward.