Autonomous delivery company Nuro has acquired Ike, a startup founded by veterans from Apple, Google and the Uber Advanced Technologies Group that aims to commercialize self-driving trucks.
The deal, the latest in a busy season of acquisitions and consolidations in the autonomous vehicle industry, brings together two companies that share strong relationships and technology. Meanwhile, the two were pursuing different applications of autonomous vehicle technology – Nuro With local delivery and Ike on long-haul freight – their founders say there is a common vision for everything to do with logistics.
The financial terms of the deal were not disclosed.
Nuro is the giant in this regard, valued at $ 5 billion and employing more than 600 people. Ike employs around 60 people and had a post-money valuation of around $ 250 million last year, according to sources. However, the company's founders don't refer to this as the classic takeover of Silicon Valley. Ike's CEO, Alden Woodrow, who co-founded the company with Jur van den Berg and Nancy Sun, said more than 55 Ike employees and its three founders will join Nuro.
It was a clear opportunity to fulfill some of the principles we founded the company for, said Woodrow, who announced the acquisition in a blog post on Medium on Wednesday.
Woodrow told TechCrunch that Ike still has a runway, which means it has the capital it needs to continue. However, scaling an autonomous vehicle manufacturer into a trading company requires a capital pool of more than $ 52 million as well as partnerships. Ike made agreements with DHL, Ryder and NFI this fall to bring his technology to fleets, but those were still in the early stages.
"I think it's pretty clear how amazing Ike's team is and how good the technology they've built is," Dave Ferguson, co-founder and president of Nuro, told TechCrunch. "What's particularly compelling to Nuro is that Ike licensed Nuro's tech stack a few years ago. All of the technology they built is on that stack. There's a shared DNA. The technology that built them we can also transfer it very easily and integrate it into our system almost via plug-and-play. "
Nuro is able to leverage the technology developed by Ike to integrate it with their own on-premises provisioning application and also use it for potential future applications, Ferguson added.
What these future uses are is an unanswered question. Nuro patent applications reveal a number of ideas for delivering hot pizzas and lattes to smaller robots. With Ike's team on board, it is possible for Nuro to expand into other types of logistics applications beyond local delivery. Although Ferguson was quick to notice that Nuro's local delivery bot called R2 is the first and foremost product.
The founders of the two companies don't like to describe Ike as a Nuro spin-off. That may be technically correct, but their roots are intertwined.
Nuro was founded in June 2016 by former Google engineers Dave Ferguson and Jiajun Zhu. The startup was originally booted by Ferguson and Zhu, but by June 2017 the couple quickly raised a $ 92 million round of funding with investments from Greylock, Banyan, and gave NetEase founder Ding Lei (aka William Ding) a seat in Nuro Board of Directors.
Meanwhile, van den Berg and Sun were both working at Apple's special project group when they joined Otto, an autonomous trucking startup that Uber acquired in 2016. Woodrow, product lead on Google X's Makani project, would also end up at Uber ATG until February 2017 as group product manager of the self-driving truck program.
By 2018, Otto's last founder had left Uber and the self-driving truck program was in free fall. Sun, Woodrow and van den Berg left Uber in the spring of 2018. A few months later, Uber closed its self-driving trucking unit to focus on autonomous cars.
The three initially worked in Nuro's office. It was too small to accommodate the delivery bots and the growing team. Sun's VW RV served as Ike's conference room in those early days. Sun, van den Berg and Woodrow worked closely with Nuro's team for months before officially launching Ike in July. California and Delaware business records show this. The company name Ike is an allusion to former President Dwight D. Eisenhower and the US interstate system that he helped shape when the Federal Aid Highway Act was signed.
The aim of this initial collaboration was to find out how what Nuro built can be applied to a new use case in truck traffic. "This was an opportunity for us to go in our own direction and really focus on that as they continued to drive the delivery on-site," Woodrow said in a recent interview.
Ike would license Nuro's technology, specifically the hardware design, autonomous software, and data logging, maps, and simulation. In return, Nuro took a minority stake in Ike.
When Ike left stealth mode in October 2018, Nuro characterized his relationship with the new company as a partnership in which "we gave Ike a copy of our autonomy and infrastructure software and in return Nuro received a stake in Ike."
Ike started small and approached the task at hand with caution. By February 2019, Ike had around 30 employees and eventually the capital to hire more people after adding $ 52 million in a seed and Series A funding round led by Bain Capital Ventures. Redpoint Ventures, Fontinalis Partners, Basis Set Ventures and Neo also took part in the round. Ajay Agarwal, partner at Bain Capital Ventures, has joined Ike's board of directors.
Unlike others who chase autonomous trucks, Ike's founders said in a blog post that they weren't pushing for the first self-driving trucks to be on the road. According to multiple sources in the AV trucking world, Ike has earned a positive reputation in the industry for its systems engineering approach and simulation tool. But it wasn't known
With Ike working calmly, Nuro became better known thanks to a $ 940 million investment from SoftBank Vision Fund in February 2019. Nuro expanded his team to more than 600 employees and partnered with Kroger in 2018 to manage a delivery service in Arizona. The pilot, who originally used Toyota Prius vehicles, switched to his R1 delivery bot. Nuro has also worked with companies like CVS, Domino, and Walmart. The company developed a second generation vehicle known as the R2, which is designed for local delivery service for restaurants, grocery stores, and other businesses. The R2 received an exemption from the federal government earlier this year that allows it to work as a driverless vehicle.
Investors weren't done with Nuro. The COVID-19 pandemic delayed the plans of many Silicon Valley startups. There were bright spots, however, including the potential for on-site delivery. Nuro raised an additional $ 500 million in November on a post-money valuation of $ 5 billion. The Series C round was led by funds and accounts advised by T. Rowe Price Associates, Inc. with the participation of new investors such as Fidelity Management & Research Company and Baillie Gifford. The round also includes existing investors such as SoftBank Vision Fund 1 and Greylock.