The concept of free Wi-Fi coverage in urban areas is nothing new, but range and other logistical limitations have hampered efforts to provide connectivity on municipal scales. Enter Veniam, an up-and-coming European startup that bagged $4.9 million in funding from top US investors on Tuesday bring its unique approach to the challenge to American cities.

The Portuguese team spent 18 months developing a “vehicular network technology” that turns cars, buses and almost every other conceivable means of motorized transportation into moving Wi-Fi hotspots. The promise is to turn the more than one billion vehicles that roam the world into mini-servers.

The building block of the vision is a compact device called NetRider that makes it possible to equip space-constrained vehicles such as personal cars with capabilities for creating hotspots and exchanging data with other nodes in what Veniam refers to as the “Internet of Moving Things.” Touted as having up to 10 times the range of other products, it provides a choice of using Wi-Fi or cellular connectivity and, crucially, comes with a range of privacy controls that make it possible to strip all identity from vehicles.

Transportation providers can manage their NetRider implementations through a cloud-based console that Veniam says simplifies administration and automates updating with scheduling options. The software also comes with a plethora of security features, from full network encryption to analytics functionality that scans for analogous activity, ensuring the privacy of users is maintained exactly as they specify.

Veniam sees its technology being applied mainly in two use cases. The first is how the mass transportation authority in the startup’s home town of Porto deployed it: as an affordable way to provide Internet access to commuters. But the other application potentially has more impact. By hooking up automotive sensors to the connected universe, vehicles themselves can become smarter. A recent study by the National Highway Traffic Safety Administration estimated that timely data on road activity could prevent as many as 592,000 car crashes every year in the US alone. And that’s not to mention the usefulness of such information in addressing technical problems and mitigating congestion, among other applications.

True Ventures is betting that Veniam will emerge as the linchpin of that connected future. The early-stage fund led the new $4.9 million round in the startup, which also saw the participation of Union Square Ventures, Cane Investments and anonymous private backers. The capital will be used to expand the company’s Mountain View office and accelerate the deployment of vehicular networks in the US, starting with New York City, the San Francisco Bay Area and Austin.

The company explains more in this video (2:47)

Photo via Veniam video