Aurora, the driverless vehicle start-up backed by Amazon and Uber, has unveiled plans to go public in a merger with a white-collar control company, becoming the first top-tier player in the industry to get a listing in stock market and establishing a test of investor appetite for such injurious firms.
Aurora said Thursday it would be founding a special-purpose purchasing vehicle created by LinkedIn co-founder Reid Hoffman and technology entrepreneur Mark Pincus.
The deal values Aurora at $ 11 billion and gives her about $ 2 billion in fresh funding, which she said would put her in a position to “launch her first standalone product by the end of 2023.”
The Bay Area company, which has 1,600 employees, was founded by a trio of pioneers of driverless technology – including executive director Chris Urmson, Sterling Anderson, who led the efforts of Tesla’s Autopilot, and Drew Bagnell, who left Uber self-driving group, which Aurora acquired last December.
Aurora was founded in 2016 amid a boom in startup robots that are emerging to compete with Google’s automotive project, where Urmson was chief engineer until his departure in 2015.
The deal gives Aurora access to the $ 850 million raised by Hoffman and Pincus’s Spac, Reinvent Technology Partners Y, plus $ 1 billion in new investment from a consortium that includes Baillie Gifford, Fidelity and the Investment Council of the Plan of Canada.
Aurora’s $ 11 billion valuation, up from $ 10 billion when it acquired Uber business last year, compares with the more than $ 30 billion valuations it recently put on rival vehicle companies. autonomous Cruise and Waymo, the Alphabet unit that is evolving from Google’s self-driving project.
Unlike GM-backed Cruise and Waymo, Aurora has not built a large fleet of prototype vehicles to test on the roads. Instead it focuses on testing in simulated worlds where it aims to “drive” the equivalent of 22m miles each day.
“We’ve invested heavily in simulation and virtual development tools,” Urmson told the Financial Times. The focus on virtual guidance in particular is “a huge cost advantage,” he added.
Aurora also put an initial emphasis on robotaxis in favor of semi-truck without driver. Earlier this year it signed partnerships with Volvo Trucks and Paccar, heavy truck manufacturer Peterbilt and Kenworth. Together, these groups have a combined market share in the United States of more than 50 percent.
It has also partnered with Uber, Toyota and Japanese parts supplier Denso. Uber, Paccar and Volvo contribute $ 1bn in new funding.
Aurora reported Thursday that it expects a cash flow of $ 553 million this year and expects an additional $ 3.7 billion in outflows for the next five years. The company will have $ 2.5 billion in cash after the closure of the Spac deal.
Shares in Reinvent Technology Partners Y rose 2 percent on the news of the merger.
Hoffman and Pincus are now Spac series retailers. Another of its blanket control companies has acquired flying taxi start-ups Joby Aviation earlier this year.
Pincus said investors in the Aurora deal have agreed to a four-year, longer-term closure, with typical Spac investors accepting only six months or a year.
“Aurora is in very fast iteration against a very tough problem, with a focus on current scale marketing, without leading live demonstrations,” Pincus said. “Everything they do to reduce hardware costs and work closely with OEM is focused on launching a truly commercial, scalable solution.”