Softbank’s Vision Fund has made another massive bet on autonomous driving technology, leading a $940m investment into Nuro.ai, a maker of robot delivery vans.
The deal adds to Softbank’s expanding portfolio in the transportation-technology market, following its Vision Fund’s $2.3bn investment in General Motors’ self-driving car unit, Cruise, last May.
Masayoshi Son’s $100bn tech investment fund also holds stakes in ride-hailing services such as Uber and Didi, which harbour ambitions in autonomous driving. Last October, SoftBank formed a joint venture with Toyota, called Monet Technologies, to provide mobility services including food deliveries.
Nuro was founded in Silicon Valley in 2016 by Jiajun Zhu and Dave Ferguson, two veterans of Google’s self-driving car team — now known as Waymo — after they decided that delivering groceries was a more achievable goal for autonomous vehicles than passenger-carrying robo-taxis.
Without people on board, developers of self-driving delivery vans face lower regulatory requirements and do not have to worry as much about ensuring a smooth, comfortable ride.
The influx of capital from Softbank’s Vision Fund takes the start-up’s total financing to more than $1bn. SoftBank’s investment values Nuro at $1.7bn, without including the new funds raised.
The deal comes just a week after another autonomous driving start-up founded by former Google engineers, Aurora, raised $530m from investors including Sequoia Capital and Amazon, which is said to value that company at $1.5bn, including the new capital.
“Our mission as a company is to accelerate the benefits of robotics in everyday life,” said Mr Ferguson. He added that Softbank’s Vision Fund and Mr Son’s “300-year vision” to develop automation and artificial intelligence were a “perfect partner”.
Yet despite the huge new investment, Nuro’s business is still in its infancy, with only half a dozen of its bespoke delivery vehicles on the roads.
Nuro, which first obtained a permit to test autonomous vehicles in its home state of California in April 2017, has been testing its technology with American supermarket chain Kroger since last year. After initially testing with a fleet of modified Toyota Priuses, the two companies began grocery deliveries to customers in Scottsdale, Arizona in December — close to where Waymo recently began its first robo-taxi service for paying customers at around the same time.
Mr Ferguson said Nuro was in talks with several large automotive and electronics manufacturers about building out a larger fleet of its delivery vehicles. A new design is already in the works that builds on feedback from its real-world testing — such as enlarging the doors to the onboard lockers that contain customers’ groceries. “It’s not an amazing experience if you go to get your groceries and you bang your head on the door,” Mr Ferguson said.
“Nuro’s world-class team has successfully scaled their self-driving technology out of the lab and into the streets,” said Michael Ronen, managing partner at SoftBank Investment Advisers. “In just two years Dave, Jiajun and team have developed Nuro from a concept into a real business using robotics to connect retailers to customers.”
Unlike smaller delivery robots that move slowly along the pavement, such as Amazon’s recently unveiled Scout and those being tested by Starship Technologies in London and Silicon Valley, Nuro’s vehicles use the roads. Its rivals include Udelv, which was founded by former Apple and Tesla engineers and last month formed a partnership with Walmart.
Mr Ferguson said the financing would allow the company to expand to new regions, increase the size of its fleet and hire more engineers.
Before its latest round, Nuro had raised $92m in mid-2017, led by Silicon Valley-based Greylock Partners and Gaorong Capital, a Chinese venture capital firm formerly known as Banyan Capital. That deal was not announced until January 2018.