Arc, a US-based electric boat startup, has raised $70m in a Series B funding round to drive growth.

The round was led by Eclipse, with participation from both new and existing investors including Menlo Ventures, Andreessen Horowitz, Abstract Ventures and Lowercarbon Capital.

Set up in 2021, Arc has developed and sold limited edition battery-electric boats, dubbed Arc One, priced at $300,000 each.

In an interview with Bloomberg Television, Arc chief technology officer Ryan Cook said: “We are only two and a half years old. We have sold and delivered these to customers — that is incredible for a hardware company — and it speaks to the engineering team that we have.”

Now, the company is looking to shift away from being a luxury electric boat maker to offer more “cost-effective” products.

A new model is planned for next year; however no information has been released, the publication said, adding that the business is now accepting completely refundable reservations.

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In a blog post, Arc said: “Our next move is to target the booming water sports market, and we are now charged to do it.”

Following the funding, the company plans to focus on developing the next generation of electric boats and expanding its operations to cater to customer demand.

To meet those goals, Arc said it is setting up a new factory in Torrance, California spanning 150,000 square feet, which is expected to open later in 2023.

The company is also recruiting across all departments including engineering, sales and marketing, production, and operations.

Eclipse managing partner Lior Susan told Bloomberg Television: “There is a new industrial renaissance in this country. You now can build the most sophisticated boat in Los Angeles.

“That would not be something you could do before. I think we are seeing companies like Tesla, SpaceX, Arc and others building a new industrial regime in this country.”

Eclipse also led Arc’s $30m Series A funding round in November 2021.