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CORRESP
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Stellar
Acquisition III Inc.

c/o
Ellenoff Grossman & Schole LLP

1345
Avenue of the Americas

New
York, NY 10105

October
25, 2018

VIA
EDGAR

U.S.
Securities and Exchange Commission

Office
of Information Technologies and Services

100
F Street, N.E.

Washington,
D.C. 20549

Attention:
Folake Ayoola, Special Counsel

 Re: Stellar
Acquisition III Inc.

Amendment
No. 3 to Registration Statement on Form S-4

Filed
October 2, 2018

File
No. 333-224227

Dear
Ms. Ayoola:

Stellar
Acquisition III Inc. (the “Company”, “we”, “us” or “our”)
hereby transmits its response to the letter from the staff (the “Staff”) of the Securities and Exchange Commission
(the “Commission”), dated October 24, 2018 (the “Comment Letter”) regarding Amendment No.
3 to our Registration Statement on Form S-4 (the “Registration Statement”). We will shortly file with the Commission
Amendment No. 4 to the Registration Statement (“Amendment No. 4”), reflecting a number of updating changes.
A marked version of the Registration Statement, in the form that will be filed with the Commission will also be transmitted to
the Staff identifying all changes between Amendment No. 3 and Amendment No. 4 to the Registration Statement.

Comment:

General

Exhibit
10.22 (Form of Warrant to Purchase Shares of Series F Preferred Stock and PhunCoin of Phunware, Inc.) to the registration statement
provides that Phunware, Inc., a reporting company and not PhunCoin the subsidiary, will issue the PhunCoin upon the initial coin
offering of the PhunCoins by Phunware. Throughout the registration statement, however, it is stated that PhunCoin, Inc., the wholly-owned
subsidiary of Phunware, will issue the PhunCoins to holders of Phunware’s Series F convertible preferred stock who received
such shares pursuant to the Warrant. Additionally, in your response letter dated August 14, 2018, you stated that PhunCoin, Inc.
will issue the PhunCoins. It therefore appears that the disclosure is inconsistent with the terms of the Warrant and that Phunware,
rather than PhunCoin, Inc., is the issuer of the PhunCoin at the time the Warrant was entered into. Please revise your disclosure
to state that the Warrant providing for the PhunCoin will be issued by Phunware and explain how PhunCoin, Inc. could assume the
obligation to issue the PhunCoins that were sold under the terms of the Warrant. In addition, please advise how the holders of
the Series F convertible preferred stock have been advised that the PhunCoins will be issued by PhunCoin, Inc. rather than Phunware.

Response:
Phunware has advised the Company that Phunware’s wholly-owned subsidiary, PhunCoin, Inc., will be the issuer of PhunCoin.
Phunware intends to assign all of its obligations under the Series F Rights with respect to the issuance of PhunCoin to PhunCoin,
Inc. by means of an amendment to the Series F Warrant. Pursuant to the amendment, PhunCoin, Inc. will fully and unconditionally
assume the obligation to issue Exchange Tokens under the Series F Warrant. The holders of Series F Warrants will be promptly notified
of the amendment and assignment of the Series F Warrants following such time as holders of a majority of the shares issuable upon
exercise of all Series F Warrants have amended the Series F Warrants to provide for the assignment of such obligations.

In
addition to the foregoing, pursuant to the conference telephone call on October 24, 2018 among representatives of Stellar and
Phunware and the reviewing Accounting Branch Chief and Staff Accountant, Phunware hereby represents to the Staff (and Stellar
hereby represents that it believes such representation to be reasonable) that (i) the Rights that have heretofore been issued,
and the Rights that will be issued from the date hereof until the anticipated effective date of the Registration Statement, are
not and will not be material to the Registration Statement (including the financial statements included therein) or to any other
financial period or periods through the effective date (including, with respect to Phunware, financial statements covering the
period from July 1, 2018 until the effective date). Stellar and Phunware acknowledge that the Staff determined not to review further
the accounting treatment relating to such Rights at this time predicated on the foregoing representation. Phunware and Stellar
further advise the Staff that if, following the effective date of the Registration Statement, the amount of Rights sold or issued
becomes material, they expect to seek further guidance from the Staff relating to the accounting treatment of the Rights. As used
herein, the term “Rights” includes both rights to acquire PhunCoin pursuant to Phunware’s Rule 506(c) offering
and rights to acquire PhunCoin pursuant to warrants issued or to be issued to investors in series of Phunware’s Series F
convertible preferred stock offering, including any warrants or PhunCoin that may be issued by any subsidiary of Phunware.

We
thank the Staff for its review of the foregoing. If you have further comments, we ask that you forward them by electronic mail
to our counsel, Jeffrey W. Rubin, Esq. at jrubin@egsllp.com or by telephone at (212) 370-1300.

    Very
    truly yours,

    /s/
    George Syllantavos

    George
                                         Syllantavos

        Co-Chief
        Executive Officer

    cc:
    Jeffrey
    W. Rubin, Esq.

    Ellenoff
    Grossman & Schole LLP