As the autonomous vehicle revolution inches closer to reality, packages rather than people could be the first regular passengers.
That is the logic behind Boxbot, an Oakland, Calif., startup that is developing self-driving delivery technology. The somewhat secretive company said Monday that it has raised $7.5 million in early-stage venture capital from a handful of investors that include Toyota’s research division.
“There are specific use cases and environments where autonomous vehicles could hit the roads now,” wrote Jim Adler, managing director of Toyota AI Ventures, in a blog post announcing the investment. “Self-driving delivery is another example of just such a use case.”
Autonomous vehicles continue to move ahead on the consumer side, with companies such as Chrysler and General Motors striking deals in recent days to partner with Google’s Waymo unit and the Japanese investment giant SoftBank, which has backed mobility companies Uber and Didi in China. But these efforts have been outpaced in recent months by the push to develop autonomous trucking to move long-haul shipments.
Even more promising in the short-term is autonomous tech that can solve that last-mile delivery issue. Numerous companies such as Deliveroo and Uber Eats have been raising and spending huge sums to create last-mile delivery networks that involve hiring thousands of drivers and cyclists. Other competitors, among them Amazon, have also been building warehouses and experimenting with last-mile logistics.
These are all costly ventures, even as the convenience they offer promises to increase purchases by customers. That means any solution that eliminates the need to hire significant numbers of people is bound to get a lot of attention. McKinsey & Co. estimates autonomous vehicles could make as many as 80 percent of last-mile deliveries by 2025.
Indeed, in recent days, Alibaba’s Jack Ma unveiled a driverless robot that it is testing at its China headquarters. Meanwhile, London-based startup Starship, the brainchild of two Estonian cofounders of Skype, is creating a fleet of delivery robots and has raised about $17 million.
“Boxbot is our first investment in the autonomous delivery space, and while we can’t go into much detail as the company is still a little stealthy, we can say we’re impressed with their business model and solution to a global problem that McKinsey values at more than $80 billion,” Adler wrote. “Winning this huge market will take a unique mix of autonomy tech, logistics expertise, and partnering savvy.”
The company is secretive. Its founders did not even offer a quote for the news release announcing the funding. However, here is what is known:
Boxbot was co-founded in late 2016 by Austin Oehlerking and Mark Godwin, two veteran engineers who had previously worked, respectively, for Tesla and Uber. The company says it “is working to address the last-mile problem in logistics, through a combination of robotics and autonomous systems.”
The company has now raised a total of $9 million. The latest round was led by Artiman Ventures, but also included Toyota. Previous investors participating this round include Pear Ventures, Afore Capital, Ironfire Ventures and The House Fund.
“Over the next few years, self-driving vehicles will transform the last-mile, making it cheaper to make deliveries and easier to receive them,” said Brian Wilcove, a partner at Artiman Ventures. “Boxbot has a unique approach, and deep expertise across the disciplines that will drive that transformation. We’re excited to join them on this journey.”