Zoox, a giant and secretive and fascinating Silicon Valley startup, is allegedly for sale, according to The Information (subscription) and partially confirmed by Zoox itself.
Price tag: $3 billion dollars?
The company was founded by Stanford PhD and AI wunderkind Jesse Levinson, along with Tim Kentley-Klay, a brash Australian designer.
For years Zoox was highly secretive about its technology and goals, even by the standards of the tight-lipped self-driving car industry. The Zoox website was a single HTML page sporting only the company logo.
In 2018, Zoox pulled back the curtain with awesome highlighting the its autonomous capabilities and Mad Max design ethos.
Only a month later, Kentley-Klay was ousted just after Zoox raised $500 million in venture funding. Eventually Zoox recruited Intel Chief Strategy Aicha Evans as CEO.
All of which is to say, Zoox has been quite a story.
And the story has continued into 2020. The company settled a Tesla lawsuit, acknowledging some employees joined Zoox from Tesla and brought proprietary Tesla documentation with them.
Apparently the company terminated contractors and laid off 10% of its workforce in light of the COVID pandemic. Now it seeks either further venture capital funding, or an acquirer.
The status of being publicly for-sale is reminiscent of Drive.AI, another prominent (although much smaller) self-driving start-up. That firm was widely reported to be shopping for a buyer during the first half of 2019. Apple ultimately acquired the startup in a firesale, days before bankruptcy.
All that said, a few qualifiers.
The stories I’ve read seem to make a lot of hay that Zoox has hired an investment bank, Qatalyst Partners. Investment banks usually do spell “sale”. But they can also spell “investment”. Particularly for a company of Zoox’s size, the sources of private investment change from traditional venture capital firms to larger institutional funds that work more regularly with investment banks. Zoox may simply be working on a really large funding round, which would go hand-in-hand with also beating the bushes for any potential acquirers.
Also, the stories I’ve read indicate Zoox plans to hire back laid off employees and contractors once coronavirus subsides. That’s easy to say now, of course, but it’s worth keeping in mind that perhaps what looks bad is merely a bump in the road.