UNITED STATES – Waymo, the self-driving unit of Alphabet Inc, has raised US$2.25 billion in its first external investment round and expects to add more outside investors, Reuters has reported.
The company has also revealed that its self-driving trucking business will be called Waymo Via.
Waymo was founded 11 years ago as a small project inside Google and is now widely considered the leader in developing self-driving technology.
Analysts however believe that Waymo and its principal rivals are still years away from building large-scale businesses around that technology.
Alphabet Chief Financial Officer Ruth Porat while addressing the Morgan Stanley investor conference said that the outside investors will help Waymo be more disciplined.
Waymo Chief Executive Officer John Krafcik, in a media briefing however, declined to confirm whether Alphabet plans to sell or spin off Waymo, saying it was “certainly a possibility for the future.”
Krafcik described the outside investment as part of “an evolutionary path that we had always imagined” that could lead to “more independence” for Waymo.
He said Alphabet would continue to join other investors in funding Waymo.
In addition to Alphabet, initial investors include auto parts supplier Magna International Inc,U.S. dealership chain AutoNation Inc (AN.N), the Canada Pension Plan Investment Board, and three large investment firms: Silver Lake, Andreessen Horowitz and Mubadala Investment.
“There’s a valuable added governance discipline when you have additional voices at the table,” Alphabet CFO Porat said. “It’s sort of somewhere between private-independent and public.”
Last September, investment bank Morgan Stanley slashed its projected valuation of Waymo to $105 billion from its earlier estimate of $175 billion, saying the commercialization of self-driving vehicles and technology was taking longer than expected.
Waymo plans to offer a range of self-driving transportation services, from its Waymo One ride hailing business in Phoenix to the new Waymo Via logistics business that would bundle local and long-haul delivery, Krafcik said.
The company also has partnered with Lyft Inc, Fiat Chrysler Automobiles, and Jaguar Land Rover, and is considering partnerships with other automakers and transportation service providers in various markets outside North America.