Alphabet’s Waymo raises RM9.5b for driverless cars

by BLOOMBERG/ pic by BLOOMBERG

NEW YORK • Waymo LLC raised US$2.25 billion (RM9.45 billion) from a slate of private equity investors, venture capitalists and automotive companies, the first time Alphabet Inc’s autonomous vehicle unit has taken outside funds.

Silver Lake Management LLC, a private equity firm, led the round, which also includes auto manufacturer Magna International Inc, car seller AutoNation Inc, Abu Dhabi’s Mubadala Investment Co and the Canada Pension Plan Investment Board.

“We’ve always approached our mission as a team sport,” John Krafcik, Waymo CEO wrote in a blog post on Monday.

The US$2.25 billion number is an “initial” close, he also noted, suggesting the deal may grow.

Financing rounds from Alphabet and outsiders will be a “pattern” going forward, Krafcik, a former Detroit executive who joined Waymo in 2015, said during a call with reporters.

The deal helps Google parent Alphabet spread the cost of funding Waymo as the unit pushes ahead to commercialise its autonomous driving technology. Krafcik also suggested the parent company could eventually spin Waymo off into an independent business.

“It’s always been on the road map for Alphabet as a possibility for some of these ‘Other Bets’ like Waymo to become completely independent, spun-out entities, so it’s certainly a possibility in the future for us,” the CEO said.

Silver Lake co-CEO Egon Durban and Ryan Selwood from the Canada Pension plan will join the board.

Krafcik said Waymo wants to expand its driverless fleet to new locations, mentioning the Middle East as one possibility, but he declined to share details. He also didn’t disclose Waymo’s new valuation from Monday’s deal.

“We certainly do see this as validation of the work we’ve been doing at Waymo and the potential before us,” Krafcik added.

The company is also merging its local delivery and long-haul trucking operations into a single business line called Waymo Via.

Waymo One is the ride-hailing service that the company operates in suburban Phoenix and plans to expand to other cities.

With both divisions, said Krafcik, Waymo would follow parallel paths of building owned-and- operated services and partnering with other providers.