Betting on China’s driverless future, Toyota, Bosch, Daimler leap on board Momenta’s $500M spherical – TechCrunch

Throughout the road from Suzhou North, a high-speed railway station in a historic metropolis close to Shanghai, a futuristic M-shaped constructing simply catches the attention of anybody passing by. It homes the headquarters of the five-year-old Chinese language autonomous driving startup, Momenta.

Like different main Chinese language cities, Suzhou, which is known for its serene canals and classical gardens, gives sponsored places of work and coverage assist to draw high-tech corporations. It appears to have chosen effectively. Momenta exceeded $1 billion in valuation in two years and have become one of many most-funded driving corporations in China. The startup has a blinding record of buyers, from Kai-Fu Lee’s Sinovation Ventures, the federal government of Suzhou, to Mercedes-Benz maker Daimler.

Momenta not too long ago closed one other huge spherical, which nears $500 million and lifts its whole funding to over $700 million. The funding marks an vital step in the direction of the agency’s worldwide growth, its chief of enterprise improvement Solar Huan advised TechCrunch. In just a few months’ time, Solar will head to Stuttgart, the German hometown of Mercedes-Benz, and open Momenta’s first European workplace.

The brand new funding, a Collection C spherical, was led by Chinese language state-backed automaker SAIC Motor, Toyota and Bosch, a sign of the normal auto monoliths’ conviction to sensible driving.

“The auto business must develop extra benefits when confronting Tesla’s advertising and marketing in the present day, so they’re paying extra consideration to autonomous driving,” Momenta’s founder and CEO Cao Xudong advised TechCrunch.

Monetary buyers main the spherical have been the Singaporean sovereign fund Temasek and Alibaba founder Jack Ma’s Yunfeng Capital. Different contributors included Mercedes-Benz AG, Xiaomi founder Lei Jun’s Shunwei Capital, Tencent, Cathay Capital and some undisclosed establishments. It’s uncommon to see Tencent and Alibaba (or their associates) co-invest.

Be pragmatic

Regardless of the sizable monetary injection, Cao mentioned that “autonomous driving corporations can now not rely solely on fundraising to burn money.”

Mega-fundraising has grow to be widespread within the capital-intensive autonomous automobile world. Momenta’s Chinese language rivals Pony.ai has amassed over $1 billion inside 5 years and four-year-old WeRide.ai has raised over $500 million. Like Momenta, the 2 corporations have nabbed investments from large automakers. Pony.ai additionally counts Toyota as an investor, and WeRide is backed by Renault-Nissan-Mitsubishi.

Momenta declined to reveal its newest valuation. For reference, Pony.ai hit $5.3 billion in its November fundraising spherical.

Momenta prides itself on what it calls a “two-legged” enterprise mannequin. In contrast to some friends that focus assets on ‘Degree 4,’ or actual driverless passenger vehicles, Momenta is promoting semi-automated driving software program to carmakers whereas investing in additional superior tech that’s years from mass adoption.

It additionally tries to cap bills by crowdsourcing knowledge from auto companions as a substitute of constructing its personal automobile fleets, which helps save billions of {dollars}, the corporate has reiterated. By accumulating driving knowledge at scale, Momenta will get to finetune its algorithms via a self-correcting system. The extra knowledge it has, the higher its machine turns into at driving.

“It really works like a flywheel,” Cao mentioned, utilizing a tech business jargon first popularized by Jeff Bezos to elucidate Amazon’s progress.

Driver’s behavior

Throughout a check journey TechCrunch went on, the place a security driver was current however didn’t intervene, a Momenta-powered Lincoln maneuvered via a neighborhood of Suzhou dotted by jaywalkers, unleashed canines, rushing scooters and reckless truck drivers. When the sedan slowed down at a freeway entrance ramp, different vehicles zipped previous us. It felt as if we have been going too slowly, however the truth is all of the human-steered vehicles have been going effectively above the 40km/h velocity restrict.

“Some drivers might want the autonomous driving automobile to be extra aggressive, so we’re additionally exploring a system that learns from particular person type,” mentioned Jiang Yunfei, an R&D engineer at Momenta who went on the journey. “After all, on the situation that the automobile is obeying site visitors guidelines.”

A pill subsequent to the dashboard confirmed what our automobile was able to seeing and predicting on the highway with a set of mass-produced sensors. “Prediction depends on knowledge,” famous Solar. “If we construct our personal automobile fleets, it is going to be very pricey to maintain the data-driven method.”

Momenta has joined within the ranks of corporations piloting robotaxis on China’s city roads. It goals to take away some security drivers from its robotaxis, which it collectively operates with auto companions, in 2022 and expects all of its automobiles to go driverless in 2024. By then, the corporate can have considerably decreased labor prices and attain a constructive working margin per automobile.

Automate globally

Momenta has stored a quiet public profile since its inception and infrequently talked about its prospects apart from its partnership with Toyota on high-definition maps, which predated the funding. What Cao might say was the corporate has fostered “deep collaborations” with carmakers and Tier-1 suppliers throughout China, Germany and Japan.

By the tip of 2021, a number of prospects will begin mass-producing mid-to-high-end vehicles geared up with Momenta’s software program. And by 2024 or 2025, Momenta’s options could possibly be powering thousands and thousands of automobiles, which ought to present a gentle stream of driving knowledge to the startup.

“Electrification is now not sufficient to distinguish one high-end automobile model from one other as a result of the motors and batteries they used are fairly comparable. The important thing differentiator now’s intelligence,” mentioned the founder.

When requested whether or not Momenta worries about challenges confronted by Chinese language corporations amid geopolitical tensions and persevering with U.S.-China technological decoupling, Jijay Shen, who not too long ago joined Momenta as vp of gross sales and advertising and marketing, mentioned such conditions are “uncontrollable” and “regulatory compliance” is the precedence for coming into any new market.

“The human race was in a position to obtain important technological progress within the final ten years precisely as a result of tech corporations from completely different international locations are constructing on prime of one another,” mentioned Shen, who spent over a decade at Huawei and was previously CEO of the telecoms large’s Eire enterprise.

“However due to geopolitical elements, many markets will start to contemplate self-subsistence within the quick time period… I can’t conclude what is best, however I believe the entire ecosystem and provide chain must suppose what’s higher — self-subsistence or interdependence.”