Author: azeeadmin

Six years ago, I sat in the Google self-driving project’s Firefly vehicle — which I described, at the time, as a “little gumdrop on wheels” — and let it ferry me around a closed course in Mountain View, California.

Little did I know that two of the people behind Firefly’s ability to see and perceive the world around it and react to that information would soon leave to start and steer an autonomous vehicle company of their very own.

Dave Ferguson and Jiajun Zhu aren’t the only Google self-driving project employees to launch an AV startup, but they might be the most underrated. Their company, Nuro, is valued at $5 billion and has high-profile partnerships with leaders in retail, logistics and food including FedEx, Domino’s and Walmart. And, they seem to have navigated the regulatory obstacle course with success — at least so far.

Yet, Nuro has remained largely in the shadows of other autonomous vehicle companies. Perhaps it’s because Nuro’s focus on autonomous delivery hasn’t captured the imagination of a general public that envisions themselves being whisked away in a robotaxi. Or it might be that they’re quieter.

Those quiet days might be coming to an end soon.

This series aims to look under Nuro’s hood, so to speak, from its earliest days as a startup to where it might be headed next — and with whom.

The lead writer of this EC-1 is Mark Harris, a freelance reporter known for investigative and long-form articles on science and technology. Our resident scoop machine, Harris is based in Seattle and also writes for Wired, The Guardian, The Economist, MIT Technology Review and Scientific American. He has broken stories about self-driving vehicles, giant airships, AI body scanners, faulty defibrillators and monkey-powered robots. In 2014, he was a Knight Science Journalism Fellow at MIT, and in 2015 he won the AAAS Kavli Science Journalism Gold Award.

The lead editor of this EC-1 was Kirsten Korosec, transportation editor at TechCrunch (that’s me), who has been writing about autonomous vehicles and the people behind them since 2014; OK maybe earlier. The assistant editor for this series was Ram Iyer, the copy editor was Richard Dal Porto, and illustrations were drawn by Nigel Sussman. The EC-1 series editor is Danny Crichton.

Nuro had no say in the content of this analysis and did not get advance access to it. Harris nor Korosec have any financial ties to Nuro.

The Nuro EC-1 comprises four articles numbering 10,600 words and a reading time of 43 minutes. Here are the topics we’ll be dialing into:

• Part 1: Origin story “How Google’s self-driving car project accidentally spawned its robotic delivery rival” (3,200 words/13 minutes) — explores the early days of Nuro and its founders and how they realized that the most useful robot they could ever build would be an autonomous delivery vehicle.
• Part 2: Regulations “Why regulators love Nuro’s self-driving delivery vehicles” (2,400 words/10 minutes) — analyzes how Nuro won over federal regulators and navigated a patchwork of policies to be able to test and deploy its autonomous delivery vehicles in several states.
• Part 3: Partnerships “How Nuro became the robotic face of Domino’s” (2,500 words/10 minutes) — digs into Nuro’s relationship with Domino’s as well its trials with other companies including fast casual restaurant chain Chipotle, Kroger grocery stores and CVS pharmacies and how those relationships have affected the design and functions of the R2 bot.
• Part 4: Operations “Here’s what the inevitable friendly neighborhood robot invasion looks like” (2,500 words/10 minutes) — examines where Nuro has set up shop, and more importantly, how it goes about picking locations and learning from its experiences.

We’re always iterating on the EC-1 format. If you have questions, comments or ideas, please send an email to TechCrunch Managing Editor Danny Crichton at danny@techcrunch.com.

Nuro doesn’t have a typical Silicon Valley origin story. It didn’t emerge after a long, slow slog from a suburban garage or through a flash of insight in a university laboratory. Nor was it founded at the behest of an eccentric billionaire with money to burn.

Nuro was born — and ramped up quickly — thanks to a cash windfall from what is now one of its biggest rivals.

In the spring of 2016, Dave Ferguson and Jiajun Zhu were teammates on Google’s self-driving car effort. Ferguson was directing the project’s computer vision, machine learning and behavior prediction teams, while Zhu (widely JZ) was in charge of the car’s perception technologies and cutting-edge simulators.

“We both were leading pretty large teams and were responsible for a pretty large portion of the Google car’s software system,” Zhu recalls.

As Google prepared to spin out its autonomous car tech into the company that would become Waymo, it first needed to settle a bonus program devised in the earliest days of its so-called Chauffeur project. Under the scheme, early team members could choose staggered payouts over a period of eight years — or leave Google and get a lump sum all at once.

Ferguson and Zhu would not confirm the amount they received, but court filings released as part of Waymo’s trade secrets case against Uber suggest they each received payouts in the neighborhood of $40 million by choosing to leave.

“What we were fortunate enough to receive as part of the self-driving car project enabled us to take riskier opportunities, to go and try to build something that had a significant chance of not working out at all,” Ferguson says.

Within weeks of their departure, the two had incorporated Nuro Inc, a company with the non-ironic mission to “better everyday life through robotics.” Its first product aimed to take a unique approach to self-driving cars: Road vehicles with all of the technical sophistication and software smarts of Google’s robotaxis, but none of the passengers.

In the five years since, Nuro’s home delivery robots have proven themselves smart, safe and nimble, outpacing Google’s vehicles to secure the first commercial deployment permit for autonomous vehicles in California, as well as groundbreaking concessions from the U.S. government.

While robotaxi companies struggle with technical hitches and regulatory red tape, Nuro has already made thousands of robotic pizza and grocery deliveries across the U.S., and Ferguson (as president) and Zhu (as CEO) are now heading a company that as of its last funding round in November 2020 valued it at $5 billion with more than 1,000 employees.

But how did they get there so fast, and where are they headed next?

Turning money into robots

“Neither JZ nor I think of ourselves as classic entrepreneurs or that starting a company is something we had to do in our lives,” Ferguson says. “It was much more the result of soul searching and trying to figure out what is the biggest possible impact that we could have.”

Nuro’s delivery autonomous vehicles (AVs) don’t have a human driver on board. The company’s founders Dave Ferguson (president) and Jiajun Zhu’s (CEO) vision of a driverless delivery vehicle sought to do away with a lot of the stuff that is essential for a normal car to have, like doors and airbags and even a steering wheel. They built an AV that spared no room in the narrow chassis for a driver’s seat, and had no need for an accelerator, windshield or brake pedals.

So when the company petitioned the U.S. government in 2018 for a minor exemption from rules requiring a rearview mirror, backup camera and a windshield, Nuro might have assumed the process wouldn’t be very arduous.

They were wrong.

In a 2019 letter to the U.S. Department of Transportation, The American Association of Motor Vehicle Administrators (AAMVA) “[wondered] about the description of pedestrian ‘crumple zones,’ and whether this may impact the vehicle’s crash-worthiness in the event of a vehicle-to-vehicle crash. Even in the absence of passengers, AAMVA has concerns about cargo ejection from the vehicle and how Nuro envisions protections from loose loads affecting the driving public.”

The National Society of Professional Engineers similarly complained that Nuro’s request lacked information about the detection of moving objects. “How would the R2X function if a small child darts onto the road from the passenger side of the vehicle as a school bus is approaching from the driver’s side?” it asked. It also recommended the petition be denied until Nuro could provide a more detailed cybersecurity plan against its bots being hacked or hijacked. (R2X is now referred to as R2)

The Alliance of Automobile Manufacturers (now the Alliance Automotive Innovation), which represents most U.S. carmakers, wrote that the National Highway Transportation Safety Agency (NHTSA) should not use Nuro’s kind of petition to “introduce new safety requirements for [AVs] that have not gone through the rigorous rule-making process.”

“What you can see is that many comments came from entrenched interests,” said David Estrada, Nuro’s chief legal and policy officer. “And that’s understandable. There are multibillion dollar industries that can be disrupted if autonomous vehicles become successful.”

To be fair, critical comments also came from nonprofit organizations genuinely concerned about unleashing robots on city streets. The Center for Auto Safety, an independent consumer group, thought that Nuro did not provide enough information on its development and testing, nor any meaningful comparison with the safety of similar, human-driven vehicles. “Indeed, the planned reliance on ‘early on-road tests … with human-manned professional safety drivers’ suggests that Nuro has limited confidence in R2X’s safe operation,” it wrote.

Nuro’s R2 delivery autonomous vehicle. Image Credits: Nuro

Despite such concerns, the National Highway Traffic Safety Administration (NHTSA) granted Nuro the exemptions it sought in February last year. Up to 5,000 R2 vehicles could be produced for a limited period of two years and subject to Nuro reporting any incidents, without a windshield, rearview mirror or backup camera. Although only a small concession, it was the first — and so far, only — time the U.S. government had relaxed vehicle safety requirements for an AV.

Now Estrada and Nuro hope to use that momentum to chip away at a mountain of regulations that never envisaged vehicles controlled by on-board robots or distant humans, extending from the foothills of local and state government to the peaks of federal and international safety rules.

If Nuro is to become the generation-defining company its founders desire, it will be due as much to innovation in regulation as advances in the technology it develops.

Regulate for success

“I don’t think any of the credible, big AV players want this to be a free-for-all,” said Dave Ferguson, Nuro’s co-founder and president. “We need the confidence of a clear regulatory framework to invest the hundreds of millions or billions of dollars necessary to manufacture vehicles at scale. Otherwise, it’s really going to limit our ability to deploy.”

Pandemic pizza was definitely a thing.

U.S. consumers forked out a record-breaking $14 billion to have pizza delivered to their doors in 2020, and nearly half of that total was spent with just one brand: Domino’s.

“Domino’s is the home of pizza delivery,” said Dennis Maloney, Domino’s chief innovation officer. “Delivery is at the core of who we are, so it’s very important for us to lead when it comes to the consumer experience of delivery.”

In its latest TV ad, an order of Domino’s pizza speeds to its destination inside a Nuro R2X delivery autonomous vehicle (AV). The R2X (now known as R2) deftly avoids potholes, falling trees and traffic jams caused by The Noid — a character created by Domino’s in the 1980s to symbolize the difficulties of delivering a pizza in 30 minutes or less.

The reality is much more sedate. Domino’s currently has just one R2X that operates from a single Domino’s store on the generally calm streets of Woodland Heights in Houston, Texas. And since the AV’s introduction in April, The Noid has yet to put in an appearance.

“The R2X adds a bunch of efficiencies while not taking away from any existing capabilities,” Maloney said. “As we start getting the bot into regular operation, we’ll see if it plays out the way we expect it to. So far, all the indications are good.”

Nuro and Domnio’s launched the autonomous pizza delivery service in Huston in April this year. Image Credits: Nuro

Partnerships are key for Nuro. The company’s business model is to sign contracts with established brands that either have their own branded vehicles or use traditional delivery companies like UPS or the U.S. Postal Service.

Nuro is carrying out trials and pilot deliveries with a number of companies, including fast casual restaurant chain Chipotle, Kroger grocery stores, CVS pharmacies, bricks-and-mortar retail behemoth Walmart, and, most recently, global parcel courier FedEx. While it is a dizzyingly impressive list for a company less than five years old, their interest was driven as much by global trends as by Nuro’s technology, admits Cosimo Leipold, head of partnerships at Nuro.

“Everybody today wants what they want and they want it faster than ever, but frankly they’re not willing to pay for it,” Leipold said. “We’ve reached a point where almost every company is going to have to offer delivery services, and now it’s just the question of how they’ll do it in the best possible way and with the most possible control.”

Nuro’s delivery AVs — aka bots — offer the tantalizing promise of safe, reliable and efficient delivery without sacrificing revenue and customer data to third-party platforms like Grubhub, DoorDash or Instacart. Alongside Nuro’s stated aim of driving the cost of delivery down to zero, it is little surprise that Nuro now finds itself in the enviable position of being able to pick and choose the partners it wants — and the less enviable position of having to choose which partner to prioritize.

Here’s the story of how one of Nuro’s biggest partnerships came to be, and the lessons and companies that will drive its future growth.

Deliveries with extra cheese

Domino’s has a long history of innovating in delivery, usually accompanied by a strong marketing campaign. In the 1980s, the company bought 10 customized Tritan Aerocar 2s, a Jetsons-styled three-wheeler, for use as delivery vehicles. In 2015, the company unveiled the DXP, a Chevrolet Spark modified with a single seat and a built-in warming oven, designed specifically for transporting pizza.

In early 2021, a Nuro autonomous delivery vehicle pulled to a halt at a four-way stop in its hometown of Mountain View, California to let a user cross. This seemingly humdrum moment quickly looked like a decidedly science fiction storyline — the user was a small sidewalk robot from another startup on its own mission.

“Obviously, we yielded to it, but it was, wow, we have entered a different world,” said Amy Jones Satrom, head of Operations at Nuro.

Mountain View is home to competitor Waymo and other autonomous vehicle testing activity. But for those who want to take part in that science fiction scene, Houston provides the full experience.

Waymo is testing self-driving trucks in Houston, and a fully driverless shuttle service is due to start public service there early next year. Nuro’s Texas effort started in April, when an R2 robot began its commercial pizza delivery service in partnership with Domino’s. Some customers ordering pizzas from the Domino’s Woodland Heights store will see the option to have their pies delivered by robot.

Customers can trace the progress of the self-driving vehicle on the Domino’s app and, when it pulls up outside their home, tap in a unique PIN on its touchscreen to access their order. Nuro is also operating in Houston with Kroger supermarkets and FedEx.

Nuro team on test track during early validation in AZ, before first ever public road deployment in Arizona. Image credit: Nuro

“One of the things we laugh about is how customers constantly talk to the bot,” Dennis Maloney, Domino’s chief innovation pfficer said. “It’s almost like they think it’s ‘Knight Rider.’ It’s very common for customers to thank it or say goodbye, which is great because that indicates we’re creating an engaging experience that they’re not frustrated by.”

Creating an experience, where people want to chat with their new robot neighbors instead of chasing them down the street with pitchforks, falls to Jones Satrom’s operations team. It has to delicately balance speed, safety, convenience and congestion, even as Nuro embarks on a growth spurt that will see robots spreading to other cities, states and partners in the months ahead.

Here’s how it manages that, and what the future holds for Nuro’s ever-so-gentle robot invasion.

Mapping the territory

Few people are as well suited to overseeing Nuro’s high-stakes robot rollout as Jones Satrom, who started her career as a nuclear engineer on an aircraft carrier and previously managed the integration of Kiva Systems’ robots into Amazon’s warehouses.

As last week came to a close, funding news involving three major U.S. technology startups lit up on Twitter.

Carta closed a $500 million Series G at a $7.4 billion price tag. Chime put together a $750 million round at a $25 billion valuation. And Discord was reported to be hunting up new cash that would value it at around $15 billion.

The Exchange explores startups, markets and money.

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Each funding round has something special about it that we need to discuss. Why? Because while it’s well-known that the unicorn market is crowded — reaching a $1 billion valuation in today’s capital-flush markets is no longer particularly rare for startups — the number of startups worth a multiple of that valuation threshold is growing rapidly. And understanding why investors are so willing to buy minute stakes in dozens of private companies worth billions of dollars is key to grokking the crush of investment we see among younger technology startups.

To make the point, CB Insights’ unicorn leaderboard lists 55 companies with valuations of $7.5 billion or more. That’s nearly five dozen companies worth more than Carta after its most recent round. According to the list, 38 of today’s unicorns are worth $10 billion or more.

The 55 startups valued at $7.5 billion and more are worth more than $1 trillion in aggregate, while the 38 decacorns are worth more than $900 billion when counted as a group.

We’ve become too accustomed to simply reading the latest nine-figure round invested at an 11-figure price and shrugging. So, this morning, let’s talk about Carta and Chime and Discord and why each of them may have managed their latest, or anticipated, valuation gain.

When we talk about unicorns, we’re simply discussing a generally growth-oriented cohort of technology upstarts. But once a startup reaches closer to the $10 billion valuation threshold, we’re really talking about ducks increasingly too big for their pond. They are the next set of IPOs both domestically and abroad.

Cisco announced on Friday that it’s acquiring Israeli applications monitoring startup Epsagon at a price pegged at $500 million. The purchase gives Cisco a more modern microservices-focused component for its growing applications monitoring portfolio.

The Israeli business publication Globes reported it had gotten confirmation from Cisco that the deal was for $500 million. TechCrunch has asked Cisco for comment on that figure.

The acquisition comes on top of a couple other high profile app monitoring deals including AppDynamics, which the company bought in 2018 for $3.7 billion and ThousandEyes, which it nabbed last year for $1 billion.

With Epsagon, the company is getting a way to monitor more modern applications built with containers and Kubernetes. Epsagon’s value proposition is a solution built from the ground up to monitor these kinds of workloads, giving users tracing and metrics, something that’s not always easy to do given the ephemeral nature of containers.

As Cisco’s Liz Centoni wrote in a blog post announcing the deal, Epsagon adds to the company’s concept of a full-stack offering in their applications monitoring portfolio. Instead of having a bunch of different applications monitoring tools for different tasks, the company envisions one that works together.

“Cisco’s approach to full-stack observability gives our customers the ability to move beyond just monitoring to a paradigm that delivers shared context across teams and enables our customers to deliver exceptional digital experiences, optimize for cost, security and performance and maximize digital business revenue,” Centoni wrote.

That experience point is particularly important because when an application isn’t working, it isn’t happening in a vacuum. It has a cascading impact across the company, possibly affecting the core business itself and certainly causing customer distress, which could put pressure on customer service to field complaints, and the site reliability team to fix it. In the worst case, it could result in customer loss and an injured reputation.

If the application monitoring system can act as an early warning system, it could help prevent the site or application from going down in the first place, and when it does go down, help track the root cause to get it up and running more quickly.

The challenge here for Cisco is incorporating Epsagon into the existing components of the application monitoring portfolio and delivering that unified monitoring experience without making it feel like a Frankenstein’s monster of a solution globbed together from the various pieces.

Epsagon launched in 2018 and has raised $30 million. According to a report in the Israeli publication, Calcalist, the company was on the verge of a big Series B round with a valuation in the range of $200 million when it accepted this offer. It certainly seems to have given its early investors a good return. The deal is expected to close later this year.

Amanda DoAmaral was an educator herself before she decided to found a tech company aimed at improving the education system. That’s a surprisingly rare credential for a startup founder in this area to possess — despite the obvious benefits of real, first-hand experience. Her company, Fiveable, focuses on modernizing (including a remote-first approach) a key and often overlooked part of education for students: Building an active community of peers to share knowledge with. Hear how she took her dissatisfaction with an inadequate system and turned that into the motivation to build a venture-scale business outside of it on this week’s episode of Found.

We talked to Amanda about her path to entrepreneurship, which is not your typical founder story, despite her experience living and teaching in the Bay Area. Amanda shares how her considerable experience in education, both in terms of her own education, as well as her job as a teacher, led her to the frustrating realization that while tech had a lot to offer kids in school, the system just wasn’t set up to support that or make it happen. Building a company that focused on a particularly underserved aspect of remote learning ended up being the best path forward — and it just so happened that the market Fiveable entered would accelerate dramatically shortly after the company’s founding due to the Covid-19 pandemic.

We loved our time chatting with Amanda, and we hope you love yours listening to the episode. And of course, we’d love if you can subscribe to Found in Apple Podcasts, on Spotify, on Google Podcasts or in your podcast app of choice. Please leave us a review and let us know what you think, or send us direct feedback either on Twitter or via email at found@techcrunch.com, or leave us a voicemail at (510) 936-1618. And please join us again next week for our next featured founder.

Facebook today announced that it would extend the “most comprehensive” subsea cable to serve the African continent and Middle East region to four more branches.

Facebook will do this in collaboration with the 2Africa consortium that includes China Mobile International, MTN GlobalConnect, Orange, STC, Telecom Egypt, Vodafone, and WIOCC.

The new branches are Seychelles, the Comoros Islands, Angola, and the south-eastern part of Nigeria. They join the recently announced extension to the Canary Islands.

Last year, Facebook announced the 2Africa project to lay 37,000 km (22,990 miles) of cables. These cables interconnect Europe, via Egypt, and the Middle East, via Saudi Arabia, and 21 landings in 16 African countries.

At the time, the involved parties said the 2Africa project would be completed either by 2023 or early 2024. And once live, 2Africa should be able to serve more than the total combined capacity of all subsea cables serving Africa at the moment. 

Image Credits: 2Africa

According to the company’s new statement released by the consortium, the plan is still to go live in late 2023. The consortium says 2Africa has made some progress as a big part of the subsea route survey activity is complete. The Egypt and Mediterranean Seas connections are almost complete as well, the statement read. In addition, the marine surveys for the new sections are scheduled to be completed by the end of this year.  

The consortium selected Nokia’s Alcatel Submarine Networks (ASN) to build the new branches, bringing 2Africa landings to 35 in 26 countries. 

“The significant investment by Facebook in 2Africa builds on several other investments we have made in the continent, including infrastructure investments in South Africa, Uganda, Nigeria, and DRC.  The COVID-19 pandemic has highlighted the importance of connectivity as billions of people around the world rely on the internet to work, attend school, and stay connected to the people they care about,” a Facebook spokesperson said regarding the company’s continued investment in Africa.

“2Africa will not only be an important element for advancing connectivity infrastructure across the African continent, but it will also be a major investment that comes at a critical time for economic recovery. With more and more people relying on the internet, subsea cables are a vital ingredient to ensure they always are connected to what matters. While Facebook invests in submarine cables to provide better experiences for people using our products, our investments drive a more cost-effective internet for all.” 

Facebook today announced that it would extend the “most comprehensive” subsea cable to serve the African continent and Middle East region to four more branches.

Facebook will do this in collaboration with the 2Africa consortium that includes China Mobile International, MTN GlobalConnect, Orange, STC, Telecom Egypt, Vodafone, and WIOCC.

The new branches are Seychelles, the Comoros Islands, Angola, and the south-eastern part of Nigeria. They join the recently announced extension to the Canary Islands.

Last year, Facebook announced the 2Africa project to lay 37,000 km (22,990 miles) of cables. These cables interconnect Europe, via Egypt, and the Middle East, via Saudi Arabia, and 21 landings in 16 African countries.

At the time, the involved parties said the 2Africa project would be completed either by 2023 or early 2024. And once live, 2Africa should be able to serve more than the total combined capacity of all subsea cables serving Africa at the moment. 

Image Credits: 2Africa

According to the company’s new statement released by the consortium, the plan is still to go live in late 2023. The consortium says 2Africa has made some progress as a big part of the subsea route survey activity is complete. The Egypt and Mediterranean Seas connections are almost complete as well, the statement read. In addition, the marine surveys for the new sections are scheduled to be completed by the end of this year.  

The consortium selected Nokia’s Alcatel Submarine Networks (ASN) to build the new branches, bringing 2Africa landings to 35 in 26 countries. 

“The significant investment by Facebook in 2Africa builds on several other investments we have made in the continent, including infrastructure investments in South Africa, Uganda, Nigeria, and DRC.  The COVID-19 pandemic has highlighted the importance of connectivity as billions of people around the world rely on the internet to work, attend school, and stay connected to the people they care about,” a Facebook spokesperson said regarding the company’s continued investment in Africa.

“2Africa will not only be an important element for advancing connectivity infrastructure across the African continent, but it will also be a major investment that comes at a critical time for economic recovery. With more and more people relying on the internet, subsea cables are a vital ingredient to ensure they always are connected to what matters. While Facebook invests in submarine cables to provide better experiences for people using our products, our investments drive a more cost-effective internet for all.”