I didn’t go to CES 2025 with the intention of getting wet on a cold January lake in Lake Mead. But when I discovered Los Angeles-based boat startup Arc has brought a new sports boat to Las Vegas, I figured it was worth the risk. That. The Arc Sport is a joy to drive, even after 30 minutes out on a choppy lake. It is maneuvered like a heavy jet ski – the weight helps it feel stable. I’ve driven a lot of electric cars, trucks, and SUVs that weigh like drag. In this case, I like to have a little heft below us. Like a boat, Arc has moved fast as a start. Arc, founded by a former SpaceX engineer, came out of stealth in 2021 with the backing of Andreessen Horowitz and Lowercarbon Capital’s Chris Sacca. It raised a $30 million Series A a few months later, led by Eclipse Ventures partner and former Tesla executive Greg Reichow. The startup shipped its first $300,000 Arc One in early 2023, raised another $70 million the same year, and is working on the $258,000 Arc Sport. image credit: sean o’kane In keeping with that pace, Arc delivered the first Sports boat to a customer late last year. It’s a “very fast development time,” founder and CEO Mitch Lee told TechCrunch as we zipped around Lake Mead. And it’s only possible because Arc took the time to learn how to make a limited-run One boat before moving on to something with a bit more mass appeal, according to Lee. “Arc One for us is [Tesla] Roadster. The first step is, let’s build this boat. Let’s do it on a small scale, and let’s learn from what the boat is in the field with customers,” said TechCrunch in an interview in November. “Now there are boats going through hurricanes. We have a boat launched in 95 degree water. Those lessons are very valuable.” When I arrived, Lee was shivering in the winter wind next to Lake Mead, but clearly still happy to show off Arc Sports and what it can do. We got on board and hit the water. This is an impressive boat before you hit the throttle. The fit and finish on the boat I piloted, which is still technically a production-oriented vehicle, is striking, especially because CES is not known as a place for polished prototypes. There are elements that can make people wonder, though. There’s a Tesla-style horizontal touchscreen with smart, fluid software that doesn’t scream “legacy manufacturer.” The second screen is located behind the steering wheel, showing the speed, battery level, and the view from the front camera. Image credit: Sean O’Kane The Sport is quieter than a typical gas boat. It is not silent. I could still hear the motor working under our feet; but it was easy to hear Lee, his two colleagues, and the other journalists on board. It’s not louder than the wind and the sound of the wake thrown behind us – a feature that sets Arc boats apart from many other hydrofoil-based electric boat startups. If you combine it with other quality of life improvements, the Sport offers few other gas competitors – like no smoke, powerful software that updates over-the-air, twin thrusters that make it easy to turn and park the boat, a retractable barrier canopy to protect from elements, and the lack of winterization required – it makes sense why lovers of water sports can pay a premium for this boat. Boats are not always difficult to control. The real learning curve comes from knowing how to navigate and act on the water. Driving the Sport on empty Lake Mead, even in choppy water, is not without its challenges. Put your hands on the steering wheel, lift the key on the throttle knob, and push forward to have 500 horsepower fun. The 226 kWh battery keeps the boat planted, and also helps the relatively short 23-foot frame make quick turns when I turn the wheel. This is the most fraught part of the experience with wind and chop. Sure enough, we were greeted by waves, splashing the icy blue water fed by the Colorado River into Lake Mead. It’s worth it, though. Everyone should be able to have fun. Image credit: Sean O’Kane On the way back to the pier, when toweling off, it’s hard not to notice Lake Mead’s depletion. A powerful combination of drought and human activity has reduced the reservoir to just 27% of its total capacity, according to NASA. In every direction I could see where the water line used to be, a phenomenon called the “bathtub ring”. This has a direct impact on boaters who use the lake for recreation – exactly the kind of people Lee hopes to sell. Lake Mead had to close some boat launches and ramps over the last few years, according to the National Park Service, and extend the rest to reach the new lake, lower level. I didn’t ask him if the evaporation of freshwater lakes was a risk to the Arc’s addressable market – that’s a bleak idea I’ll raise next. What I understand is that Lee has said that the goal is that every watercraft switches to electricity. That includes looking beyond powersports, perhaps even to government and defense – an idea that seed investor Andreessen Horowitz is quite fond of today. When I asked Lee about this in November, he demurred, but left the door open. “We can’t be disrupted too early, because if we do, we will fail as a company,” he said. “The reason we can develop Arc Sport so quickly is because of the work done on Arc One. I can go down this long list of all carryovers and IPs, but the same thing applies to commercial, moving to the government sector, and our aspiration as a business is always to do that. We are not ready to discuss anything there.”
