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Japanese conglomerate SoftBank is investing more than $1 billion in British self-driving car startup Wayve, marking Europe’s largest artificial intelligence deal to date.
The funding round, which also includes Nvidia and existing investor Microsoft, will enable the London-based company to deploy its autonomous systems in cars in the coming years.
Wayve’s new funding is the largest for a European AI startup, after France-based Mistral raised $415 million in December and German firm Aleph Alpha raised $500 million in November.
The deal is significant for the UK, which has ambitions of becoming a global center for AI research and expertise but has largely failed to grow or retain its most promising companies in the field.
Prime Minister Rishi Sunak said the deal “cemented the UK’s position as an AI superpower”, adding: “The fact that a home-grown UK company has secured the largest-ever investment in a UK AI company is testament to our leadership in this industry.” .
It also confirms SoftBank CEO Masayoshi Son’s renewed search for AI investments in leading startups after previously being slow to deploy capital in the sector compared to rivals, and comes at a time when analysts are speculating that he may be working on larger deals.
Wayve, founded in 2017, has developed an AI system that allows vehicles to learn while driving, eliminating the need for costly mapping and expensive laser-based sensors and potentially bringing self-driving cars to market in new areas faster and at a lower cost can than larger US rivals such as Alphabet’s Waymo.
The company is in discussions with several car manufacturers about using its systems, rather than planning to launch its own fleet of vehicles in the coming years.
Wayve hopes to expand its technology from cars to other types of robots, calling its approach “embodied AI” as opposed to purely online chatbots like OpenAI’s ChatGPT.
Kentaro Matsui, head of new business at SoftBank and managing partner of the Vision Fund, said Wayve is pursuing a “very sensible, down-to-earth strategy.”
Matsui added that it took about 18 months from the Vision Fund meeting with Wayve to the formal investment decision. However, the money comes from SoftBank and not its Vision Funds. Another person familiar with the matter said SoftBank provided the bulk of the $1.05 billion funding round.
The deal marks the most significant UK AI venture since 2014, when Google acquired the British startup DeepMind founded by Sir Demis Hassabis, a unit that has become crucial to the Silicon Valley giant’s development of cutting-edge technology.
“Wayve is probably the most advanced embodied AI company in the world and it’s here in the UK,” said Suranga Chandratillake, partner at Balderton Capital, an investor in the company. He added that the startup represents a “really important foot in the door” for the UK in an increasingly geopolitical race for dominance in the next era of computing.
However, there have been doubts about the use of self-driving technology in cars as there have been a number of high-profile accidents and the industry has been divided over its approach.
Tesla, which takes a similar approach to Wayve, has become notorious in recent years for CEO Elon Musk’s overly optimistic predictions about its vehicles’ autonomous driving capabilities. However, the electric car maker is increasingly focusing on AI and plans to launch so-called robotaxis this year.
“By pooling insights from different types of vehicles around the world instead of “a restricted city with one type of vehicle,” Wayve’s system can reproduce realistic driving behavior while complying with traffic laws, said Alex Kendall, co-founder and chief executive.
Currently, Wayve offers so-called Level 2 automation, which enables partially autonomous driving and which SoftBank’s Matsui described as “eyes on, hands off.”
At a demonstration to the Financial Times in London last week, a car with Wayve’s first-generation technology felt smooth and natural. It was capable of overtaking stopped buses, negotiating temporary road construction sites with unmarked narrow lanes, and leaving room for pedestrians to exit a parked car while avoiding an oncoming vehicle.
Only once during the 40-minute test drive, when a large van refused to give way when changing lanes, did a safety driver intervene to brake and steer.
“Based on feedback from automakers, we believe this will be a category-defining company,” said Brent Hoberman, whose Firstminute Capital fund is one of Wayve’s early investors.