Alphabet‘s self-driving company unit Waymo raised $2.25 billion in its first external funding round that includes several Silicon Valley heavy-hitters, the company announced Monday.
The funding round comes as the company looks to outside investors for funding the increasingly costly ambition of its “Other Bets” companies outside its core Google business. A little over a year ago, Alphabet’s life sciences company Verily got a $1 billion in funding round led by Silver Lake.
Investors in the latest round include Alphabet itself, along with outside firms like Silver Lake, Andreessen Horowitz and AutoNation, which disclosed Monday that it invested $50 million in Waymo.
The external funding round is a sign that some of Alphabet’s Other Bets companies like Waymo need much more funding than Alphabet is willing to provide on its own. Most Other Bets companies are funded through revenues generated by Alphabet’s cash cow Google, which makes most of the company’s profits thanks to its dominant digital ads business.
“We’ve always approached our mission as a team sport, collaborating with our OEM and supplier partners, our operations partners, and the communities we serve to build and deploy the world’s most experienced driver,” said John Krafcik, CEO of Waymo in a blog post. “Today, we’re expanding that team, adding financial investors and important strategic partners who bring decades of experience investing in and supporting successful technology companies building transformative products.
The investment will go toward employees, technology, and global operations, the company stated, adding that its driving technology has accrued more than 20 million miles on public roads and 10 billion simulated miles.
The latest round also comes as Waymo, along with other self-driving car companies, find wider adoption more difficult than expected.
CNBC first reported last summer that Waymo still largely relied on human safety drivers, and the company only started offering fully autonomous rides around that time. Last fall, Morgan Stanley cut its valuation on Waymo by 40% from $175 billion to $105 billion, concluding that the industry is moving toward commercialization more slowly than expected.
Last fall, CNBC found that Waymo shuttered its Austin facility, affecting at least 100 employees who described a “sudden” closure. Waymo said it was a relocation effort.
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