TechCrunch Mobility: Is $16 Billion Enough to Build a Profitable Robotaxi Business? | TechCrunch

Welcome back to TechCrunch Mobility – your central hub for news and insights on the future of transportation. To get this in your inbox, sign up for free here – just click TechCrunch Mobility!

WaymoThe acceleration of the past eighteen months is undeniable. The Alphabet-owned self-driving company now operates commercial robotaxi services in six markets, including the San Francisco Bay Area, Phoenix, Los Angeles, Austin, Atlanta and Miami. It has plans to expand its fleet of self-driving taxis to more than a dozen new cities internationally this year, including London and Tokyo.

And now it has $16 billion to fuel that expansion. Is it enough?

When I spoke to a few industry observers, the answer kept falling into lame “kind of” and “it depends” territory.

First the bull case. Alphabet is clearly committed to ensuring Waymo’s success; the parent company is and remains the main investor. That means Waymo isn’t exposed like other AV startups that suddenly lost their funding after their backers (often older automakers) became skittish or giddy.

The ridership and mileage metrics are also exploding and will likely continue on that trajectory unless regulators derail it. (Waymo offers 400,000 rides every week in six major U.S. metropolitan areas, and by 2025 alone it will more than triple its annual volume to 15 million rides.)

However, this does not guarantee success, especially if the metric is focused on profitability. Waymo still needs to resolve several issues, including costs and increasing attention from regulators (the company’s Chief Safety Officer just testified in a Senate trade hearing). If Waymo simply wants to be the licensor of its AV technology, it will have to relinquish ownership, which means giving up some control. That’s difficult with an emerging technology under scrutiny.

And while some of you will fight me on this, the internal production of it is also lacking Tesla has. Yes, Waymo has car partners. But it doesn’t offer the same financial leverage or ability to reduce costs with scale.

Disagree? Send your argument to my email at kirsten.korosec@techcrunch.com.

A little bird

The investors behind the now defunct EV startup Canoe were always mysterious – in fact, they were only revealed as part of a lawsuit. Six years ago I was given the tip to look at one of them specifically: David Stern. He had connections to Prince Andrew, but was otherwise a ghost.

However, I thought of him when the Justice Department began releasing his files Jeffrey Epstein. My curiosity about whether he would appear in the documents was quickly overwhelmed by the fact that he was in fact a close business associate of the convicted sex offender. He brought Epstein investment opportunities from all over the world, and in particular he pitched him on investing Faraday future, Clear enginesand Canoo during the go-go days of mobility finance. Read my story about Stern and Epstein’s relationship and how mobility startups were once in the mix.

– Sean O’Kane

Do you have a tip for us? Email Kirsten Korosec at kirsten.korosec@techcrunch.com or my signal at kkorosec.07, or email Sean O’Kane at sean.okane@techcrunch.com.

Offers!

Autonomous vehicle technology is about more than just robotaxis – it’s a difficult and costly endeavor that only a handful of well-capitalized companies are into Tesla, Waymo, And Zoo are pursuing. Many startup founders are applying the AV systems they’ve developed to other use cases, including off-road defense, trucking, forklift, mining, and construction. Investors who are afraid of missing out on the AV party are jumping into these sectors.

Basic robotics is the latest example of investor interest. The Silicon Valley autonomous vehicle technology startup, founded by Waymo and Segment veterans, is developing a self-driving system that can be retrofitted to construction equipment. And it just raised $270 million in Series B funding, co-led by CapitalG and the Valor Atreides AI Fund. Other investors include Xora, 8VC, Eclipse, Emergence Capital, Perry Creek Capital, NVentures (the venture capital arm of Nvidia), Tishman Speyer, Massachusetts Institute of Technology, Georgian, Incharge Capital, C4 Ventures and others.

Bedrock raised over $350 million in a short period of time (the company was founded in 2024). And while that may not seem like much compared to the size of some seed rounds in the AI ​​lab sector, it shows that money is flowing into brick-and-mortar AI startups. I expect more deal flow; More importantly, I expect that the startups that focus on practical applications of automated driving systems will attract talent – ​​if they can afford it. For example, Bedrock has hired Vincent Gonguet, who previously led AI safety and tuning at Meta for all Llama models, as head of evaluation. It also hired John Chu from Waymo.

Stay tuned for my interview with co-founder and CEO of Bedrock Robotics Boris Softman.

Other deals that caught my attention this week…

German manufacturer of electric motors Additive drives €25 million raised ($29.5 million) from Nordic Alpha Partners.

Start-up of autonomous underwater vehicles Apeiron laboratories closed a $9.5 million Series A round led by Dyne Ventures, RA Capital Management Planetary Health and S2G Investments. Assembly Ventures, Bay Bridge Ventures and TFX Capital participated.

GoCabthe African mobility fintech startup, has raised $45 million financing round consisting of $15 million in equity and $30 million in debt. The equity round was co-led by E3 Capital and Janngo Capital, with participation from KawiSafi Ventures and Cur8 Capital.

Mitra EVa commercial EV fleet company in Los Angeles, Raised $27 million in financing, including equity financing from lead investor Ultra Capital and a credit facility from S2G Investments.

AI by landa Seattle-based developer of self-driving systems designed for military operations, $100 million raised in a round led by 8VC. Other investors included Point72 Ventures, Ascend Venture Capital, Shasta Ventures, Overmatch Ventures, Valor Equity Partners and StepStone Group.

Plugthe second-hand EV marketplace, Raised $20 million in a Series A led by Lightspeed with participation from Galvanize and existing investors Autotech Ventures, Leap Forward Ventures and Renn Global.

R3 Roboticsa European startup that wants to automate the disassembly of EV systems on a large scale, €20 million raised ($23.6 million) in combination of grants and venture capital financing. The €14 million ($16.5 million) Series A financing was co-led by HG Ventures and Suma Capital. Oetker Collection, the European Innovation Council Fund (EIC Fund) and existing shareholders, including BONVENTURE, FlixFounders and EIT Urban Mobility, also participated.

In sectionsan El Segundo, California-based aviation automation startup has raised more than $300 million in a Series C investment. The round, led by Autopilot Ventures, pushes its valuation to $1.15 billion. Other investors include Fidelity Management & Research Company, ArrowMark Partners, Atreides Management LP, BAM Elevate, Baron Capital Group, Sustainable Capital Partners, Positive Sum, Qatar Investment Authority, RCM Private Markets Fund managed by Rokos Capital Management and Woodline Partners.

Notable reading and other tidbits

China has banned hidden electronically operated door handles popularized by Tesla. The ruling, published by China’s Ministry of Industry and Information Technology, says all new cars sold in the country before January 1, 2027 must have mechanical releases on the door handles. There are rumors that Europe could soon follow suit.

Uber continues to take steps to make it competitive in the autonomous vehicle sector. The company has been promoted Balaji Krishnamurthythe vice president of strategic finance and investor relations, to become the CFO. This may not seem connected to AVs, but it is. Krishnamurthy actively promotes the company’s autonomous ride-hailing partnerships and holds a board seat at AV company Waabi. During the company’s Q4 call, he talked about AVs, saying the company would invest capital in its AV software partners, partner with AV makers through equity investments or through offtake agreements, and “support our AV infrastructure partners.”

In the meantime, a high-profile lawsuit is underway Uber has issued a mixed verdict for the taxi company, which was sued after a woman alleged she was raped by her Uber driver in November 2023. A jury determined that Uber was liable as the apparent agent of the driver and awarded the plaintiff $8.5 million. The jury rejected claims that Uber was liable for negligence or design defects and declined to award damages. An Uber spokesperson, who emailed TechCrunch a statement, said it “affirms that Uber has acted responsibly and invested meaningfully in passenger safety. We will continue to put safety at the heart of everything we do.” Uber plans to appeal the decision.

One more thing…

Last week we conducted a survey in our newsletter asking what the name or ticker is from Elon Musk‘s combined super company should be. Thanks to those who emailed their suggestions, many of which were space-themed, like Galactic As for the poll, the majority chose pure X.

That makes sense, since Musk has often spoken and posted about X, the everything app. About 50% voted for

My choice? I think ultimately it will be X, and the company will include more than just SpaceX and xAI.

Sign up for our newsletter to participate in our polls!