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Stellar Acquisition III Inc.

90 Kifissias Avenue

Maroussi Athens, 15125

Greece

+30 210 876-4858

June 11, 2018

VIA EDGAR

U.S. Securities and Exchange Commission

100 F Street, N.E.

Mail Stop 3720

Washington, D.C. 20549

Attention: Folake Ayoola, Special Counsel, Office of Information
Technologies and Services

    Re:
    Stellar Acquisition III Inc.

    Registration Statement on Form S-4

    Filed April 11, 2018

    File No. 333-224227

Ladies and Gentlemen:

Stellar Acquisition III Inc. (the “Company,”
“we,” “our” or “us”) hereby transmits its response to the comments of
the staff (the “Staff”) of the Division of Corporation Finance of the Securities and Exchange Commission contained
in the Staff’s letter dated May 14, 2018 (the “Letter”) regarding the above-referenced registration statement
on Form S-4 (the “Registration Statement”). For ease of reference, the numbered paragraphs below correspond
to the numbered comments in the Letter, with the Staff’s comments presented in bold font type.

The responses below follow the sequentially
numbered comments from the Letter. Capitalized terms used but not otherwise defined herein have the meanings ascribed to such
terms in the Registration Statement. We have today filed with the Commission Amendment No. 1 to the Registration Statement (“Amendment
No. 1”), including a number of updating changes and, to the extent indicated below, reflecting our responses to the
Staff’s comments.

General

 1. Comment:

You disclose on page 72 that, pursuant to the merger
agreement, Phunware has agreed to use commercially reasonable efforts to consummate an initial block-chain technology token generation
event via the launch of PhunCoin on or prior to June 30, 2018.

Response:

Please see the specific responses set forth below
following each of the comments below.

The Company has correspondingly updated the disclosure
on pages 189 and 190 of Amendment No. 1.

Securities and Exchange Commission

June 11, 2018

Page 2

Comment:

Please provide details of the mechanics of Phunware’s
initial block-chain technology token generation event. Explain how Phunware intends to comply with the registration and other requirements
of the federal securities laws.

Response: Phunware has advised the Company
that it intends to form a wholly-owned subsidiary (the “PhunCoin Sub”) that will be the issuer of the PhunCoin.
PhunCoin will be designed for use within the PhunCoin ecosystem, which is intended to be a rewards marketplace and data exchange
whereby users receive PhunCoin in exchange for their information and PhunCoin can be redeemed by users for goods and services.
The PhunCoin ecosystem is currently in the development stage and is intended to enhance and augment Phunware’s current mobile
application platform, which enables businesses to engage, manage and monetize the information collected by Phunware’s customers
from Phunware’s consumers.

We have been advised that Phunware currently anticipates
that Phunware’s products and technologies will be enhanced through the creation of the PhunCoin ecosystem, and that users
in the new PhunCoin ecosystem will fall into three basic categories:

 · Manufacturers, consumer product companies, marketing firms, brands
and other sellers of goods and services. Phunware generally refers to this group as its “customers.”

 · Individuals that provide personally identifiable information to Phunware
and its customers. Phunware generally refers to this group as “consumers.”

 · Application developers that will include the PhunCoin software development
kits into their applications and other software developers and engineers that will help create and maintain the PhunCoin ecosystem.
Phunware generally refers to this group as “developers.”

As advised by Phunware, Phunware
anticipates that when the PhunCoin ecosystem becomes operational, Phunware’s customers will generally continue to pay cash
for use of Phunware’s technology and its consumers and developers will generally receive PhunCoin in exchange for providing
services and information to Phunware and its customers.

Initially, the PhunCoin Sub will
be issuing rights to receive future PhunCoin (the “Rights”). These Rights will only be issued to accredited
investors pursuant to an offering conducted in accordance with Rule 506(c) of Regulation
D under the Securities Act of 1933, as amended (the “Securities Act”) that complies with know-your-customer
(“KYC”), anti-money-laundering (“AML”) and accredited investor verification requirements.
This offering of Rights is intended to fund the development and completion of the PhunCoin ecosystem. In addition, as part of
Phunware’s Series F preferred stock financing conducted in reliance on exemptions from registration requirements under Section
4(a)(2) of the Securities Act, investors in such financing received a warrant to purchase Series F preferred stock of Phunware
as well as a right to the future issuance of a certain amount of PhunCoin.

Securities and Exchange Commission

June 11, 2018

Page 3

Phunware has advised the Company that, when the PhunCoin
ecosystem is operational, which Phunware expects will be approximately one year after the Rule 506(c) offering for Rights has closed,
Phunware expects that the PhunCoin Sub will issue PhunCoin pursuant to Regulation A (Tier 2) (“Reg A+”). Phunware
intends to use Reg A+ because it expects the recipients of PhunCoin to include both accredited and unaccredited investors who will
be issued PhunCoins that have been qualified in the Reg A+ offering. As described in greater detail below, Phunware expects consumers
to provide their personally identifiable information and data in exchange for PhunCoin that has been qualified under Reg A+, to
assist customers by better informing brands through enriching data by consumers providing additional information to build a more
complete consumer profile and/or by consumers participating in marketing campaigns. With respect to secondary purchases and sales
of Rights, if applicable, and PhunCoin, such transfers will only be permitted in compliance with either resale exemptions under
federal securities laws such as Rule 144, or the qualification of such privately placed PhunCoin under the Reg A+ offering discussed
below (subject to volume restrictions on selling shareholder securities). In addition, the listing and trading of PhunCoin will
only be authorized on alternative trading systems registered with the SEC. As the PhunCoin Sub (prior to the qualification of PhunCoin
under Reg A+) is a non-reporting company, the transfer restrictions applicable to accredited investors will be lifted after twelve
months pursuant to Rule 144, and Phunware intends to use only compliant exchanges in order to ensure proper KYC/AML processes are
in place.

Comment:

Describe how the token generation event will result
in proceeds to you and disclose how you will use those proceeds.

Response:

Phunware’s “token generation event”
referred to in Amendment No. 1 is meant to refer to the launch of its PhunCoin ecosystem, initially through the Rule 506(c) offering
for Rights, which will result in proceeds to the PhunCoin Sub and its parent company, Phunware (together, the “Phunware
Companies”), to be followed by a fully compliant Reg A+ offering for PhunCoin. The Company has been advised that Phunware
currently expects that the proceeds from the Rule 506(c) offering of Rights will be used solely to fund development of the PhunCoin
ecosystem, with any additional amounts being used at the discretion of Phunware.

The Company has been advised that Phunware currently
estimates that the proceeds from the Rule 506(c) offering of Rights will be used as follows:

 · 35%
- Sales & Marketing

 · 35%
- Research & Development

 · 20%
- Ecosystem Development

 · 10%
- General & Administrative

Securities and Exchange Commission

June 11, 2018

Page 4

Comment:

Please describe the technical characteristics of
the PhunCoin, including how it will be distributed and whether, and if so how, holders can trade or redeem it.

Response: Phunware has advised the Company
that PhunCoin will be digital assets built and transacted on top of an existing blockchain technology. Phunware does not intend
to create its own blockchain technology. As a part of its research and development, Phunware expects to evaluate several blockchain
technologies to determine which of these providers meet the design specifications Phunware requires to create the ecosystem. Phunware
is currently evaluating the feasibility of potential solutions such as Ethereum, Stellar, Cardano and EOS. For each blockchain
technology, Phunware expects to conduct technical evaluations, performance evaluations, user testing, and other analyses in order
to determine the best technology for the PhunCoin ecosystem. In addition, Phunware will only launch on a blockchain technology
that will enable it to comply with the registration and other requirements of the federal securities laws and other applicable
laws and regulations.

As
described above, the initial distribution of PhunCoin will occur through the issuance of PhunCoin in connection with the warrant
and the offering of Rights (which will entitle holders to exchange those warrants or Rights, as applicable, for PhunCoin) and
thereafter through the qualification and issuance of PhunCoin in compliance with Reg A+. Accredited investors who purchase Rights
in the Rule 506(c) offering are expected to receive their PhunCoin via a transaction on the blockchain to a digital wallet under
their control only after the 12-month holding period has ended or in conjunction with a qualified Reg A+ offering in which the
PhunCoin related to the 506(c) offering will be included in the PhunCoin to be qualified under Reg A+ (i.e., up to $15 million
assuming a $50 million initial Reg A+ offering); provided, however, that their PhunCoin may be released earlier if SEC
compliant alternative trading systems and/or technology that allows required resale restrictions to be embedded in the blockchain
is otherwise available sooner. Accredited investors who hold warrants are expected to receive PhunCoin
upon the earlier of the date such PhunCoin are freely tradeable under rule 144 or the qualification of the Reg A+ offering.

Once Phunware’s proposed Reg A+ offering is
qualified by the Commission, Phunware intends to distribute PhunCoin qualified under Reg A+ to consumers in exchange for their
agreements to provide certain benefits to Phunware, including, but not limited to, enriching their data with additional information
and participating in marketing campaigns that will assist Phunware to deliver increased value to customers. Phunware also expects
to distribute PhunCoin qualified under Reg A + to developers in exchange for services, i.e., for the inclusion of the PhunCoin
software development kit (i.e. SDK) into the developers’ applications and for the application usage data they provide to
the system.

Securities and Exchange Commission

June 11, 2018

Page 5

Phunware has advised the Company that it plans to
also register as a money services business with the U.S. Department of the Treasury’s Financial Crimes Enforcement Network
to the extent PhunCoin are considered a convertible virtual currency. Phunware also plans to obtain state money transmitter licenses
where required as it builds its digital marketplace in order to enable holders of PhunCoin to redeem their tokens with the PhunCoin
Sub for gift cards or other digital goods and services offered by the PhunCoin Sub. Phunware is exploring whether, in the future,
PhunCoin could also be transacted between users as opposed to redemption by PhunCoin Sub (for example, facilitating token holders
paying developers directly with PhunCoin for digital goods and services provided by developers or consumers using PhunCoin to purchase
goods directly from customers). Phunware understands that this type of functionality may require the PhunCoin ecosystem to become
a registered broker-dealer and registered as an alternative trading system with the Commission.

Phunware has also advised the Company that to the
extent that state securities laws impose additional restrictions or requirements on the issuance of the PhunCoin to users, it will
not issue PhunCoin in those states unless the issuance complies with such state rules and regulations.

To reiterate, the parameters of the PhunCoin ecosystem
and the specific mechanics and processes to be used in operating the ecosystem and issuing PhunCoins are still being analyzed and
formulated. Therefore, the descriptions above may be modified in order to ensure compliance with all regulatory requirements at
both the federal and state levels, including in the areas of securities law, commodities laws and FinCen regulations that are identified
as being implicated in the PhunCoin ecosystem as it eventually will be implemented.

Comment:

Describe whether you have or will take action to
have PhunCoin listed for trading on any trading platform.

Response: The Company has been advised that,
at this time, Phunware has not taken any steps to list PhunCoin on a trading platform. Phunware has advised the Company that it
intends to list PhunCoin on trading platforms in the future, provided that those platforms comply with all applicable federal securities
laws.

Comment:

Describe the legal and economic rights of the PhunCoin.
Disclose whether all PhunCoins will have the same rights.

Response: The Company has been advised by Phunware
that PhunCoin is intended to be a digital asset that entitles the holder to access the PhunCoin ecosystem that Phunware is building
and to use PhunCoin in exchange for goods and services in the PhunCoin ecosystem. Both the PhunCoin and the PhunCoin ecosystem
are currently under development, so the specific legal and economic rights have not been finalized. However, the Company has been
informed that Phunware does not expect that PhunCoin will have any governance, voting, ownership, dividend or other rights with
respect to either PhunCoin Sub or Phunware, and that Phunware expects that all holders of PhunCoin will have the same rights. The
Company has been advised that Phunware is committed to investor protection, transparency and full disclosure in addition to complying
with all the disclosure requirements of the federal securities laws in connection with the issuance of PhunCoin. The Company has
also been informed that, in this regard, Phunware intends to provide detailed information to all of its users as to the mechanics,
benefits and risks of using PhunCoin and the PhunCoin ecosystem.

Securities and Exchange Commission

June 11, 2018

Page 6

Comment:

Describe how PhunCoin relates to Phunware’s
core business and how Phunware will use PhunCoin for core business activities. Explain how you expect the token generation event
to impact your primary operations. Also, discuss the costs of creating PhunCoin and the material risks you face in implementing
it.

Response: Phunware’s
core business is as a mobile application platform enabling its customers to utilize the platform to engage, manage and monetize
their interaction with consumers. Today, this takes the form of software modules such as location-based services, analytics, content
management, marketing automation, and other customer engagement technologies designed to create desired business outcomes for
that customer.

Phunware has informed the Company that it expects
to integrate PhunCoin into its core business platform as well as create new software and systems to support the PhunCoin ecosystem.

PhunCoin will complement and supplement
Phunware’s core business by adding new capabilities for its customers to use “cryptonetworking” (see Response
to Comment No. 22) to engage consumers, while at the same time creating a new ecosystem that allows those consumers to benefit
from the provision and use of their data. Phunware has advised the Company that its