If you thought that startups like Uber and Lyft have changed the world of technology then there's more.
According to the Wall Street Journal, a recent funding sent a secret startup, Zoox's valuation to a whopping $1.55billion. The billion-dollar firm aimed to work towards the concept of self-driving has managed to attract $50million in Zoox's latest round of funding in October.
The historic swing from traditional engines to electric and chip-controlled technology is happening through some of Silicon Valley's best-financed startups. The worlds' biggest automakers are strategically funding startups with the intention of expanding and competing in technology-driven markets.
Valued at more than $1billion, established unicorns like Uber, Lyft and Gett are aligning with auto industry giants to create enough room for further innovation.
So far, Uber dominates the ride-sharing industry, with significantly high valuation of $68billion and no scarcity of funding avenues. In May 2016, Japanese automaker Toyota Motor Corp. strengthened its partnership with Uber by buying a small stake in the world's largest unicorn. Through a new leasing program, Toyota will offer its vehicles to Uber drivers, who will get help with lease payments through the ride-hailing fares.
In June 2016, Uber received a massive $3.5billion from Saudi Arabia's Public Investment Fund which would strengthen the unicorn's presence in the middle eastern markets. In July, Uber established its growing interest in commercial autonomous technology by acquiring Otto, a maker of self-driving technology for delivery trucks.
In May 2016, Uber's rival in China, Didi Chuxing Technology, secured a $1billion deal from tech giant Apple ( APPL ), which will provide the latter a better understanding of its second largest market. Recently, Apple confirmed its interest in developing self-driving cars to US National Highway Traffic Safety Administration. In a letter addressed to the Highway Administration, the company's director of product integrity Steve Kenner wrote, "The company is investing heavily in the study of machine learning and automation, and is excited about the potential of automated systems in many areas, including transportation." So far, Apple had only been rumored to have shown an inclination towards the autonomous technology.
In the second quarter of 2016, Gett, an Uber rival dominant in Europe, raised $300 million from the German car giant Volkswagen. By teaming up with VW, also Europe's largest car maker, Gett could also gain first access to autonomous cars (predicted to account for half of new car purchases by 2030). The partnership comes after collaborative efforts of General Motors Co. and Lyft early this year.
The U.S.'s leading carmaker, GM announced its partnership with Lyft Inc., investing $500million in the 2nd largest US ride-hailing service . Though much of the talks are at a nascent stage, the joint effort to test a fleet of self-driving Chevrolet Bolt electric taxis on public roads happens within a year.
At a time when venture capitalists are tightening their purse strings, newer transportation startups like Scoop and Via, are also not too far behind in raising capital in the hyper-competitive market. In 2016, BMW i Ventures invested in carpooling app startup, Scoop in seed stage capital round and the on-demand transit company, Via managed to raise as much as $70 million early this year.
But even though solidified partnerships have occurred in 2016, the VC funding in the year remains inconsistent. The drop in deal counts but increased capital investment signifies that even though venture capitalists are deploying capital to ride-sharing startups, they are doing so after a much deeper and a more careful scrutiny of startups.