November 9—Nuro, an autonomous delivery transport startup, announced it has secured $500 million in Series C funding. Reuters noted the firm’s latest fundraising round pushed its valuation to $5 billion.
The four-year-old company will utilize its new financing to expand its headcount and scale up its manufacturing capabilities.
Nuro’s $500 Million Cash Injection
Nuro revealed investment group T. Rowe Price Associates led its latest funding round. The firm received capital from new backers Baillie Gifford and Fidelity Management & Research. Its old stakeholders, Softbank and Greylock, also contributed to the company’s war chest.
The startup enjoyed a lucrative Series C round in part because of wider market trends.
Since the coronavirus pandemic outbreak, the world has come to appreciate the value of e-commerce like never before. Amazon permanently added 125,000 people to its logistics team to compensate for COVID-19 prompted demand. Similarly, online grocery delivery service Instacart entered profitability because of a massive spike in orders from homebound consumers.
The autonomous vehicle sector has also seen a sharp increase in investment activity this year. To date, self-driving car businesses have raised more than $7.1 billion this year, which tops 2019’s total. Amazon reportedly spent $1.3 billion to acquire driverless automobile firm Zoox in July, and Waymo closed a $3 billion fundraising round in May.
Since it is an autonomous vehicle startup and e-commerce logistics provider, backing the company is a no-brainer for forward-looking investors. Even amid industry-reshaping events, it stands out because of its recent progress.
Nuro’s Upward Trajectory
Founded in 2016, Nuro has managed to outpace some of its larger and better-financed contemporaries.
The firm has successfully launched two iterations of its central offering, a driverless local delivery vehicle. Its latest product, a battery-powered transport called R2, can move groceries, prepared meals, flowers, and medicines without operator oversight. Thus far, it has secured authorization to operate its automobiles on public roads in California, Texas, and Arizona.
The company’s ability to assure regulators its vehicles are safe has helped it forge some important business relationships. In May, Nuro inked an agreement with CVS to use its fleet to bring medications to patients in Texas. The firm previously made deals to transport goods for Walmart, Domino’s, and Kroger.
At present, multiple high profile autonomous vehicle startups have yet to debut their initial products. By contrast, Nuro has found success with its development, government negotiations, and customer capturing efforts. It has also reached those achievements with only $1.5 billion in outside investments since its inception.
The Silicon Valley startup’s latest cash injection should help it become even more of a tech sector player. It will use its $500 million to hire more staffers and increase its vehicle production. Thanks to February approvals from the U.S. Department of Transportation and the National Highway Traffic Safety Administration, the company can have 5,000 transports on the road.
With demand for its services high and its technology at a point of maturity, Nuro is primed for transformative success. With any luck, its delivery vehicles will become commonplace nationwide within a few years.