(Bloomberg) -- Waymo, Alphabet Inc.’s autonomous driving unit, raised $5.6 billion from investors, its largest-ever funding round.
The investment was led by Google parent Alphabet and included participation from Andreessen Horowitz and big-name finance firms Fidelity Investments, T. Rowe Price Group and others, Waymo said in a statement on Friday.
Waymo is one of a large pack of companies pursuing robotaxi services in the US. It runs a commercial ridehailing platform in San Francisco, Phoenix and Los Angeles, where it charges fares for trips in self-driving cars. Waymo also recently partnered with Uber Technologies Inc. to offer rides through its app in new markets Austin and Atlanta, starting next year.
Earlier this year, Alphabet pledged to invest as much as $5 billion over several years to help the startup build its autonomous driving technology. Waymo didn’t specify how much of this round Alphabet accounted for. Waymo’s valuation was not disclosed.
Alphabet shares were up 1.5% to $165.10 at 11:14 a.m. Friday in New York.
Waymo raised $2.25 billion in 2020, marking the first time it accepted outside investment. The funding was led by private equity firm Silver Lake Management LLC, which also participated in the latest round. The company raised another $2.5 billion in 2021.
By taking outside capital, Alphabet is hedging its risk of going all-in on autonomous driving, an industry that will likely face regulatory hurdles as it grows. It also faces fierce competition with Tesla Inc. to dominate the growing multibillion-dollar market. Earlier this month, Tesla’s stock fell as much as 10% after an event previewing its own robotaxis was poorly received.
“The funding probably carries Waymo all the way to a public listing where it would join several other autonomous vehicle rivals,” BloombergNEF analyst Andrew Grant said. Those rivals include the Chinese firms WeRide, which made its Nasdaq debut on Friday, and Pony AI Inc., which has filed for a US initial public offering.
Waymo’s current fleet of retrofitted Jaguar EVs will soon grow to include Hyundai Motor Co. EVs with built-in autonomous driving technology made at the Korean automaker’s new plant in Georgia.
Waymo cars provide more than 100,000 rides each week, according to the company. As of August, they had logged over 25 million miles without a human driver.
(Updates with additional context starting in the sixth paragraph.)
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