Nuro Raises $106M as It Pivots from Delivery Bots to Licensing Autonomous Tech

 Nuro $106 million in Series E funding

Autonomous driving startup Nuro has raised $106 million in Series E funding, marking a significant milestone as it shifts from developing quirky delivery robots to licensing its self-driving technology to major commercial players.

This fresh capital infusion brings Nuro’s total funding to $2.2 billion and places its current valuation at $6 billion — a dip from the $8.6 billion valuation it secured during its 2021 Series D. But in today’s market, where valuations across the board are under pressure, this down round reflects more of a market reset than a red flag.

A Strategic Shift: From Delivery Bots to Licensing

Nuro’s earlier model focused on designing and deploying its own fleet of small, passenger-less delivery vehicles, famously partnering with brands like Domino’s. However, vehicle manufacturing proved costly, and the company found itself burning through cash.

After multiple rounds of layoffs and halting its in-house production plans, Nuro recalibrated its strategy to focus on what it does best: autonomous driving technology. Now, it aims to license its software to OEMs, commercial delivery fleets, and ride-hailing companies — a capital-efficient model that lets others handle the hardware.

“We feel very good about this valuation and the conviction it shows in our new go-to-market strategy,” said Dave Ferguson, co-founder and president of Nuro. “We’ve been operating efficiently for the past several years and are now on a capital-efficient path forward.”

Extending the Runway, Fueling Expansion

Nuro has claimed that advancements in AI and its refined business model have extended its operational runway from 1.5 years to 3.5 years as of May 2023. With the Series E round now complete, the company says it has funding secured through 2027, giving it room to focus on commercial expansion and technology development.

The raise was led by existing backers, including T. Rowe Price, Fidelity, Tiger Global, Greylock Partners, and XN LP, along with several unnamed strategic partners. While Nuro didn’t disclose all the new strategic participants, the company already holds ties with Toyota and Uber, thanks to past investments from Woven Capital, Toyota’s venture arm.

“We’re excited to see strong investor enthusiasm for our Series E,” said Jiajun Zhu, co-founder and CEO of Nuro. “Our years of Level 4 deployment experience and focus on licensing uniquely position us to help partners accelerate their autonomy roadmaps.”

A New Kind of Competition

With this pivot, Nuro enters direct competition with other autonomy tech providers like Wayve in the UK, which also plans to supply its AI models to various transportation platforms — from personal cars to robotaxi services.

Nuro’s focus on software licensing, paired with years of autonomy testing in California and Texas, may give it an edge as companies seek proven self-driving solutions without taking on the burden of building the tech themselves.

TL;DR: Nuro just raised $106M in a strategic pivot away from building delivery robots and toward licensing its self-driving software to auto and mobility partners. The move is seen as a capital-efficient strategy, extending the company's runway through 2027 and setting it up for long-term growth.