Self-driving technology company Aurora Innovation was hoping to raise hundreds of millions in additional capital as it races toward a driverless commercial launch by the end of 2024. The company, which had arranged to sell up to $420 million worth of shares, exceeded its goal and raised $483 million.
Self-driving technology company Aurora Innovation is looking to raise hundreds of millions in additional capital as it races toward a driverless commercial launch by the end of 2024.
The California Department of Motor Vehicles this week granted Nuro approval to test its third-generation R3 autonomous delivery vehicle in four Bay Area cities, giving the AV startup a positive boost after facing some setbacks and financial struggles.
Andrej Karpathy, former head of AI at Tesla and researcher at OpenAI, is launching Eureka Labs, an “AI native” education platform. In tech speak, that usually means built from the ground up with AI at its core. And while Eureka Labs’s AI ambitions are lofty, the company is starting with a more traditional approach to teaching.
On today’s episode of Equity, Rebecca Bellan explored Google’s reported talks to acquire Wiz, a cloud security company, for around $23 billion. Wiz provides an “all-in-one approach to cloud security,” pulling data from Amazon Web Services, Microsoft Azure, Google Cloud and others, then scanning it all for security risk factors — something that Google might see as a good way to fortify its own cloud business, which grew 28% to $9.57 billion in Q1 this year.
When VanMoof declared bankruptcy last year, it left around 5,000 customers who had pre-ordered e-bikes in the lurch. Now VanMoof is up and running under new management, and the company’s current owners are courting those same customers by offering them a €1,000 discount off a new bike.
For the last two decades, Raquel Urtasun, founder and CEO of autonomous trucking startup Waabi, has been developing AI systems that can reason as a human would.
Everything in society can feel geared toward optimization – whether that’s standardized testing or artificial intelligence algorithms. We’re taught to know what outcome you want to achieve, and find the path towards getting there.
A new crop of early-stage startups — along with some recent VC investments — illustrates a niche emerging in the autonomous vehicle technology sector. Unlike the companies bringing robotaxis to city streets, these startups are taking their tech off-road.
Two recent entrants — Seattle-based Overland AI and New Brunswick-based Potential — are poised to get a first-mover advantage on this segment of autonomy.
While these startups are applying their tech in different ways, Overland AI and Potential do share some common off-road ground. Founders of each startup believe they’ve cracked the code to one of the more challenging applications of automated driving by building software that doesn’t rely on some of the main crutches of testing and deployment — such as detailed maps, large swaths of training data and the ability to fall back on remote assistance.
The U.S. Department of Defense and venture capital investors are taking notice.
Overland AI, which is developing a self-driving system designed for military operations like reconnaissance, surveillance and delivering electronic warfare packages, was awarded in April up to $18.6 million from the U.S. Army’s Defense Innovation Unit. The funds will be used to build a prototype autonomous software stack for its Robotic Combat Vehicle (RCV) program over the next two years.
The startup, which was founded in 2022, raised this week a $10 million seed round led by Point72 Ventures. The funds will be used to expand Overland’s team and continue developing OverDrive, the company’s autonomy stack, according to CEO and founder Byron Boots.
Meanwhile, Potential, which is making advanced driver assistance systems (ADAS) that allows ATVs, underground mining vehicles and passenger cars to handle off-road environments, has raised a $2 million CAD (~$1.5 million USD) extension to its seed round led by Brightspark Ventures, a Canadian early-stage VC. That brings Potential’s total funding to $8.5 million CAD (~$6.2 million USD). The startup has spent the last six years developing its technology and is now doing several pilot projects across power sports, motorcycles and automotive.
Potential and Overland AI aren’t the only companies trying to apply autonomous vehicle technology to areas outside of public streets. The high-cost pursuit of commercial robotaxi and self-driving truck operations has thwarted dozens of startups over the past several years. As those shut down, a new batch of startups such as Polymath Robotics, Forterra, Pronto.ai, Bear Robotics and Outrider have emerged with more grounded ambitions: applying AV tech to warehouses, mining, industrial and off-road environments.
“We are absolutely deploying capital in off-road autonomy,” Alexei Andreev, managing director at Autotech Ventures, told TechCrunch. “Actually, if anything, we are staying away from highway autonomy and completely doubled down on off-road autonomy.”
Most of the off-road companies that Autotech Ventures is investing in today are in the agricultural and construction sectors — products like autonomous mining vehicles, forklifts and tractors. Andreev says for these sectors, it’s about addressing the labor shortage while increasing productivity and making farms and construction areas safer.
“And if you remove people, you immediately get a reduction in your insurance premiums. So the ROI for those vertical applications is now and it’s significant,” said Andreev.
Another upshot: Off-road autonomy has found a friend in defense.
When it comes to automating off-road driving, the U.S. Army can be a great customer. After all, autonomous vehicles started as a DARPA project, says Jeff Peters, a partner at Ibex Investors. DARPA (Defense Advanced Research Projects Agency) is a U.S. Department of Defense agency focused on advancing technology for military use.
“The hype around AV moved a lot of the industry toward bigger potential commercial applications, but DoD projects have persisted,” Peters told TechCrunch over email, noting that autonomous mining startup SafeAI and autonomous trucking startup Kodiak Robotics have also pursued defense grants. “I think AV companies (those still around) will chase DoD projects because it offers large, non-dilutive funding in the interim prior to commercial operations.”
Overland AI is the latest byproduct of the DARPA program. Boots, a professor of machine learning at the University of Washington and founder of the Robot Learning Laboratory at the university’s school of computer science and engineering, has a long history of collaborating with the U.S. Army Research Lab and DARPA.
Overland was spun out from Boots’ research and team involved in DARPA’s RACER (Robotic Autonomy in Complex Environments with Resiliency) program, the goal of which is to develop self-driving vehicles that can handle tough terrain.
The program is still ongoing. Overland, which is stacked with deep tech veterans from Google, Nvidia, Apple, Waymo, Aurora, Embark and Argo as well as software engineers who’ve worked on mission-critical solutions at SpaceX, RTX and the U.S. Army, was recently selected to continue on to the second phase.
“The high-level idea is that currently just about every ground vehicle that the military uses has a person inside of it,” Boots told TechCrunch in a video interview. “And you can imagine if you can just pull the person out of the vehicle, that confers safety and tactical advantages.”
To pull the person out means vehicles must autonomously navigate complex off-road terrain using only onboard sensors (mainly cameras, according to Boots) and compute, without relying on maps, GPS or remote human operators. That means Overland’s software has to understand the geometry of the ground — including things like vegetation and mud — every step of the way, and how that affects vehicle dynamics.
“The terrain gets a vote on how the vehicle moves,” said Boots.
Overland’s tech “basically takes in the sensor data and builds a terrain representation as it goes,” Boots explained. Then the vehicle uses that digital representation “plus the goal that it’s trying to get to, which could be several kilometers away, to try to find a route through the terrain towards that goal.”
“Part of the benefit of having an autonomous system is that when the system is tasked, if you lose a communication link to that ground vehicle, it will continue to move towards its goal and try to complete the task until the communication link is reestablished,” said Boots.
Most on-road driving today relies on that telecommunications link to remote assistance, in part because the risk to other road users is higher. That’s why you’ll see Waymo and Cruise robotaxis bricked up on the streets of San Francisco, waiting for a remote operator to give them a nudge after they stopped driving to meet a minimum safety requirement.
“Military ground systems often need to function in unstructured, dynamic terrain. We believe self-driving technology built for well-defined streets and enclosed lots will struggle there, and that it takes a very strong team to deliver operationally relevant ground autonomy in these environments,” Chris Morales, partner on the defense tech team at Point72 Ventures, told TechCrunch.
“How can you actually enable somebody who maybe isn’t the 100% expert driver, but somebody who wants to go off-roading and experience these more challenging conditions?” Sam Poirier, CEO at Potential, asked in a recent interview.
Potential’s core platform, called Terrain Intelligence, uses computer vision to help vehicles see, interpret and prepare for complex terrain and changing surface conditions ahead. Terrain Intelligence can read data from a single camera, rather than relying on additional sensors like additional cameras, lidar and radar.
At the most basic level, Potential’s off-road ADAS alerts the driver to an impassable object up ahead or the need to switch to a better drive setting based on new terrain.
“The second level is, can we instead actually help to automate the changes of what are typically driver-assisted settings?” said Poirier. “Most vehicles have two-wheel drive, four-wheel drive, sand mode, mud mode, things like that. Ultimately, at this stage, it’s up to the driver to switch between these…and the driver has to understand when to use these different modes.”
Potential’s final level would involve using existing sensor data and fine-tuning those settings and pushing the limits of performance.
“There are things that the assistance tools can do that an individual driver — no matter how good your expertise — cannot do on their own,” said Scott Kunselman, an ex-Jeep chief engineer, auto industry veteran and advisor to Potential. “Stability controls are a good example because to enable stability control, you need independent brake control. The driver only has one brake pedal and actuates the whole brake system at once. Whereas stability control can individually actuate each wheel and that’s how you can produce, for example, the ability to offset yaw in a vehicle.”
Yaw, by the way, is when a vehicle’s weight shifts from its center of gravity to the right or left, which can cause it to spin out or fishtail.
Potential said it’s working with both Tier 1 suppliers and OEMs to license its software and integrate it directly into the vehicles. Andreev suggests Potential focus on business relations with Tier 1 suppliers rather than OEMs that are less likely to take a chance on a small startup.
Serve Robotics, the Uber and Nvidia-backed sidewalk robot delivery company, debuted publicly on the New York stock exchange Thursday, making it the latest startup to choose going public via a reverse merger as an alternative path to capital needed to fund growth.
The company, which spun out of Uber’s acquisition of Postmates in 2021, hits the Nasdaq under the ticker “SERV” with gross proceeds of roughly $40 million — “prior to deducting underwriting discounts and offering expenses,” per regulatory filings — at a share price of $4.
Serve completed its reverse merger with blank-check company Patricia Acquisition Corp in August 2023, and at the same time secured $30 million in a round led by existing investors Uber, Nvidia and Wavemaker Partners, bringing its total amount raised at the time to $56 million. While Serve’s debut in the public markets comes from a reverse merger and not a SPAC, the two alternate paths to IPO are not too dissimilar. They both provide startups with a faster route to public markets. However, pulling this particular financial lever has its risks, especially if the company is pre-revenue or bringing in very little revenue. We need look no further than the countless fallen autonomous vehicle and electric vehicle companies to determine that this is not a golden ticket to longevity or profitability.
Like any publicly traded company, this path does require financial disclosures that provides information on revenue and profits or losses.
Serve brought in $207,545 in revenue last year, up from $107,819 in 2022, per regulatory filings. That’s at a loss of $1.5 million in 2023 and $1.04 million in 2022. However, Serve Robotics said it’s expecting enormous growth fueled by money generated by going public. Those funds will go towards funding R&D for future generations of robots, manufacturing activities, geographic expansion and general working capital and corporate purposes.
The startup also has some big revenue ambitions. Serve said it aims to generate between $60 million and $80 million in annual revenue, with contribution margins of over 50% and positive cash flow by the end of 2025. The company pointed to recent momentum, including its 25% month-over-month increase in deliveries since 2022 when the startup started delivering for Uber Eats.
Future growth will come from scaling the 100 robots deployed today in Los Angeles to up to 2,000 robots in multiple U.S. cities by the end of next year through a contract with Uber Eats. Serve has also enlisted Magna International as a manufacturing partner. Currently, Serve handles 300 restaurants via the Uber Eats and 7-Eleven platform in LA, but has its eyes on Dallas, San Diego and Vancouver, Canada, according to CEO Ali Kashani.
Serve projects that a big portion of its revenue will come from ads, Kashani told TechCrunch.
“I never thought that I would start a robotics company and then be in the ads business,” said a tired, but excited, Kashani in a phone interview minutes after the bell rang. It’s normal for companies to barely sleep before making their public debut out of a need to finalize all the financials and pure adrenaline. “But it’s great because this can help offset the delivery costs, so everybody wins.”
Kashani said Serve has had a lot of inbound interest for ads on its cute little sidewalk robots. On an annual basis, ad revenue can generate 25% to 50% of Serve’s total revenue, he said.
That’s one of the value propositions Serve has pitched to investors. Serve also says it can tap the rapid progress in AI and robotics to help reduce reliance on cars, because who needs something as small as a burrito delivered in a sedan anyway?
“The tailwind here is that these robots are a lot more scalable than a lot of the alternative approaches we have,” said Kashani. “If you look at a car, it has about 3,000 times more kinetic energy than one of our robots, so just by nature, these are safer… for pedestrians, bikers for everybody else, and I think that’s definitely recognized when we when we talk to cities. So there’s a lot of regulatory momentum, but you also have the fact that there is a shortage of labor. You can see companies in the delivery space are still not necessarily profitable, and they’re looking for ways to bring some mix of automation into their fleets. So we see a lot of interest in in the solution that we’re providing.”
Serve’s robots operate at Level 4 autonomy, meaning they can operate autonomously within certain boundaries and conditions. However, Serve still relies on remote human operators to supervise operations in certain scenarios, like at intersections or if something unexpected happens.
The company’s offering is expected to close around April 22. Serve’s gross proceeds from the offering could hit about $46 million, according to Kashani, if Aegis Capital Corp., the deal’s underwriter, takes the company up on its 45-day option to buy up to 150,000 additional shares of common stock, or about 15% of the number of shares sold, to cover any over-allotments.
Upon the closing of the merger, Uber held a 16.6% stake and Nvidia an 14.3% stake in Serve, according to regulatory filings. An April filing shows that stake will change to 11.5% and 10.1% respectively once the offering closes, but a Serve spokesperson caveated that those percentages may change given the $4 opening share price.
Sarfraz Maredia, Uber’s vice president of delivery and head of its Americas region, has joined Serve’s board.
Serve Robotics started its life as Postmates X, the robotics division of on-demand delivery company Postmates. The autonomous sidewalk robots started delivering to Postmates customers in multiple Los Angeles neighborhoods in 2018. It started a commercial service in 2020.
Uber acquired Postmates in late 2020 for $2.65 billion. Three months later, Postmates X spun out as an independent company called Serve Robotics. The new name was taken from the autonomous sidewalk delivery bot that was developed and piloted by Postmates.
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