Waymo is following in the footsteps of rivals Cruise and Argo.
Until now, Waymo (formerly the Google self-driving car project) has been a wholly owned subsidiary of Google parent company Alphabet. While the company enjoyed a limited amount of autonomy, CEO John Krafcik still ultimately reported to Alphabet brass. Waymo has never published its own financial results, but it’s widely believed that Alphabet has absorbed billions of dollars of losses as Waymo has refined its technology.
Now Alphabet won’t have to bear the financial burden alone. Waymo says that for the first time it hasraised fundingfrom outside investors. The total fundraising round is $2.25 billion—though some of that money is coming from parent company Alphabet. Other investors include Silver Lake, Andreessen Horowitz, and the Canada Pension Plan Investment Board.
Waymo is following in the footsteps of two of its biggest rivals—GM’s Cruise and Ford’s Argo. Cruise has raised more than $3 billionin three roundsfrom Softbank, T. Rowe Price, Honda, and parent company GM. The Honda investment has helped cement an alliance that could lead to Honda adopting Cruise’s self-driving technology for its own vehicles.
Ford’s self-driving company, Argo, reached a similar deal with Volkswagen last year, with VW investing $1 billion to support the development of Argo’s self-driving technology. VW also folded its own self-driving subsidiary into Argo. The deal was part of a broader technology-sharing alliance between Ford and VW.
There are no major automakers among Waymo’s new investors, but Waymo also seems to be using its fundraising round to help solidify its relationships with existing business partners.
Last year, Waymoannounceda partnership with Magna, an auto parts supplier known for helping customers with contract manufacturing of complete cars, to help Waymo build its self-driving cars in Michigan. Magna is now a Waymo investor.
Waymo has long been cultivating a relationship with AutoNation, one of the biggest sellers of auto parts to consumers. AutoNation has helped Waymo maintain and repair its vehicles. The companies have also experimented with using Waymo vehicles to sell car parts to AutoNation customers. Now AutoNation is a Waymo investor, too.