Subscribe to the Crunchbase Daily

The San Francisco-based startup had raised just over $20 million since it was founded in 2015. Its last fundraise, a $16.5 million led by , took place in March 2018. Previous investors include , , and 9Point Ventures.

At the time of its Series A, Starsky announced that it had successfully driven its self-driving cargo truck for seven miles without a driver, according to .

“No safety driver behind the wheel, no engineer hiding on the bunk. We are the first company to make driverless trucks a reality,” Starsky Robotics’ co-founder CEO said in a blog post then.

Fast-forward just over two years, and Seltz-Axmacher published a with a far more somber tone titled simply, “The End of Starsky Robotics.” He wrote:

“In 2015, I got obsessed with the idea of driverless trucks and started Starsky Robotics. In 2016, we became the first street-legal vehicle to be paid to do real work without a person behind the wheel. In 2018, we became the first street-legal truck to do a fully unmanned run, albeit on a closed road. In 2019, our truck became the first fully-unmanned truck to drive on a live highway.

And in 2020, we’re shutting down.”

It’s unclear exactly how many employees will be affected by the shutdown, but a photo from February 2019 posted on Seltz-Axmacher’s blog shows “much of Starsky’s office team,” with just under three dozen employees.

In a March 19 , Seltz-Axmacher details how things fell apart at the company. By Nov. 12, 2019, Starsky’s $20 million Series B had fallen through, and most of the team was furloughed just three days later in what he described as “probably the worst day of my life.” The founders then started working on selling the company, and “making sure the team didn’t go without shelter.”

What happened?

With so many autonomous vehicle funding companies raising millions of dollars as of late, one has to wonder what happened in the case of Starsky Robotics.

Seltz-Axmacher blames timing in part for his company’s demise.

In his blog post, he said the space was too overwhelmed “with the unmet promise of AI to focus on a practical solution.”

He continued:

“As those breakthroughs failed to appear, the downpour of investor interest became a drizzle. It also didn’t help that last year’s tech IPOs took a lot of energy out of the tech industry, and that trucking has been in a recession for 18 or so months.”

Seltz-Axmacher also noted that investors didn’t seem to care for the company’s model of being the operator. He also claimed that Starsky’s “heavy investment into safety didn’t translate for investors.”

Currently in the process of selling the assets of the company, Seltz-Axmacher said those assets include a number of patents essential to operating unmanned vehicles.

Meanwhile, ’s raised a staggering $2.25 billion earlier this month. That deal came just 10 months after rival self-driving car outfit at an approximate $18 billion post-money valuation. In February 2019, self-driving car startup raised $530 million in a led by .

Starsky’s competitors include (which raised last September) and Canada’s .

According to VentureBeat, in September 2017 Starsky Robotics completed the longest end-to-end autonomous trip on record. “After Hurricane Irma hit southwestern Florida, the company used one of its trucks to aid recovery efforts, hauling water 68 miles from one end of the state to the other without human intervention.”

I’m no self-driving expert but that sounds pretty cool.

Illustration:

Now that stocks are officially in bear market territory, and measures to curb coronavirus have turned the biggest tech hubs into work-from-home zones, we decided to check in to see if the downturn has yet impacted startup funding totals.

Subscribe to the Crunchbase Daily

The broad finding: Not quite yet. A Crunchbase global analysis of sizable venture funding rounds ($10 million and up) shows that reported totals are down about 11 percent in 2020 compared to the same period last year.

Overall, investors have put $41.1 billion to work in reported rounds of $10 million and up through March 17 of this year, compared to $46.2 billion in the same period in 2019. Although it looks like a moderate decline, it’s actually too early to tell, given that a sizable percentage of financings actually get reported weeks or months after the date they close.

This year’s totals have been boosted by supergiant financings for a handful of companies, with a lot of the money going toward transportation. That includes -incubated autonomous transportation startup ($2.25 billion venture round), ride-hailing rivals and ($1.2 billion and $856 million, respectively) and electric aircraft developer ($590 million).

Major funding recipients in sectors other than transport, meanwhile, include plant-based meat producer ($500 million), banking upstart ($500 million) and data warehousing provider ($479 million).

Why are big deals happening in the current environment? Partly, it’s because big, complicated private financing rounds typically take weeks or months to close.

Thus, it’s not entirely surprising to see some of the largest private investments getting announced over the same period that major stock indexes are posting their largest declines in years. A deal put together in a more bullish climate might be made public in a more bearish one.

Earlier indications of funding cutbacks may be more easily seen for smaller rounds at early and seed stage, when sought-after deals come together more quickly. However, this is difficult for us to track here at Crunchbase because reporting delays are also most frequent at these earliest stages. So, it’s hard to determine whether a drop in funding is due to delayed reporting or fewer checks being written.

Historically, however, startup funding has trended sharply lower in recessionary times, including after the implosion of the dot-com bubble in 2001 and the financial crisis of 2008-9.

If past cycles are any guide, we can expect a sharp startup funding slowdown in coming months. We’ll keep monitoring the funding totals for indications of that coming to pass.

Illustration: .

The autonomous driving company, previously incubated as an “other bets” project under the umbrella of , says it has raised a staggering $2.25 billion in financing from investors including , the , and Abu Dhabi’s sovereign wealth fund . Other firms including , global automotive supplier , pre-owned vehicle listing service , and its corporate parent Alphabet also participated in Waymo’s round.

Subscribe to the Crunchbase Daily

“We’ve always approached our mission as a team sport, collaborating with our [original equipment manufacturer] and supplier partners, our operations partners and the communities we serve to build and deploy the world’s most experienced driver,” said , CEO of Waymo. “Today, we’re expanding that team, adding financial investors and important strategic partners who bring decades of experience investing in and supporting successful technology companies building transformative products. With this injection of capital and business acumen, alongside Alphabet, we’ll deepen our investment in our people, our technology and our operations, all in support of the deployment of the Waymo Driver around the world.”

Waymo did not say, precisely, what it will do with its newfound cash, but it did share a number of development and business milestones. The company says its autonomous Waymo Driver platform has driven “more than 20 million miles on public roads across over 25 cities, and over 10 billion miles in simulation.” Waymo added that the company has already shipped its first L4 autonomous vehicles (which include electric vehicles and Class 8 trucks, according to the company) with the company’s latest hardware and beefed onboard sensors and compute hardware.

The company also provided updates about Waymo One, its on-demand autonomous car service which currently operates in Arizona. The service has already provided thousands of trips to locals “in a high-speed mixed usage market area larger than San Francisco.”

The deal comes 10 months after rival self-driving car outfit at an approximate $18 billion post-money valuation. The , , and automakers and participated in the raise.

TechCrunch in March 2019 that the company was seeking outside investment at a lofty valuation. In September, to $105 billion from $175 billion, based on its discounted cashflows.

No information about the company’s valuation or other terms of today’s financing have been disclosed at this time.

Illustration: .

Subscribe to the Crunchbase Daily

IPO last week was an important moment for the unicorn era: Could a company with slowing growth and persistently sharp losses defend its private-market value or IPO price? The answer so far is no and no.

With Uber’s equity off 8.5 percent as of the time of writing ($38.02 per share, or a value of $63.78 billion), the firm is now worth less than it was as a private company, let alone the $45 per share at which it went public. It’s a disappointing result, and not one that can be fully blamed on market conditions.

Let’s make two points this morning. First, let’s remind ourselves about some common wisdom from Silicon Valley. Following, let’s kick the knees out from under some historical revisionism that is being bandied about in defense of Uber. You know, that old “Amazon lost money while going public and did fine, Facebook’s shares fell after its IPO and it did fine” argument.

If This, Then That

Cover young, technology-related, growth-oriented companies long enough and you’ll hear a few saws trotted out as conversation blockers. The first for us today is the old chestnut that “great companies can always raise.” It isn’t true, but it is meant to indicate that the strongest startups won’t ever run out of capital because private investors will always be able to see past market conditions to provide cash to the most promising outfits.

Again, false, but what is true is that companies perceived to be the hottest things around can always raise. That’s a related, but notably different point.

Corollary to the first concept is one that’s even more interesting: “Great companies can always go public.” I hear this mostly when I ask a private-market investor about things like IPO windows. It’s a defensive response, but one that I think is sincerely held.

And then there’s Uber which made the case for the first point being true during its period of hyper-growth. And it �������Dz�����made the second point, managing a large IPO during a challenging week of macro and market fear. But then its shares fell sharply on their first day, capping off that disappointment with more losses today. So Uber has shown that companies can go public during periods of turmoil provided that there is enough demand for their shares (this is nigh-tautology but hear me out), but it has also shown that companies which get over the IPO-hump on brand more than fundamentals can get spat back up like a piece of gristle.

Are we being too harsh to Uber? Some would argue yes. After all, some of tech’s largest players today, firms like Facebook and Alphabet, struggled after they went public. Couldn’t Uber be more of the same?

(Update: Uber itself made the point this morning, “Remember that the Facebook and Amazon post-IPO trading was incredibly difficult for those companies. And look at how they have delivered since.”)

No

No. For a few reasons, which we’ll explore now.

But before, let’s make some allowances: The market is fickle and impossible to predict. Uber’s result likely would have been better had the market not decided it wanted to get sick all over itself during its early trading days. And Uber could turn around its business, find efficient sources of growth, cut its losses, and drive its shares out of the ditch (now off 9.12 percent as of the time of writing this paragraph).

If that happens, however, the examples of the Facebook and Alphabet IPOs as historical precedent for the Uber turnaround. The companies are not comparable. For a few reasons, which we detail below:

• $ operating profit, trailing 12 months at IPO: $423.8 million.
• $ operating profit, trailing 12 months at IPO: $1.75 billion.
• $ operating profit, trailing 12 months at IPO: -$3.03 billion.

And in those metrics we’ve done Uber a favor by not counting its preliminary Q1 2019 results. Instead, we used its fully-accounted 2018 quarters which sport a smaller aggregate operating loss.

As you can see, there is a difference between Alphabet and Facebook, and Uber. You can repeat the experiment with growth rates as well, which I recommend that you do (S-1/As are linked in the companies’ ticker symbols).

But what you see above are two companies that were hugely profitable before they went public. And even then they struggled somewhat. Alphabet’s reverse dutch auction was a bit of a mess , and Facebook’s uncertain mobile future weighed on its shares. But since both companies were nicely profitable, and in the latter case cracked the key question regarding its future, they took off and did more than fine.

Both Facebook and Alphabet were younger at the time of their IPOs than Uber was, and they made money. That’s the difference and the reason why their success bears little to do with what may happen with Uber—at least in the short and medium-term.

Making money is better than losing money, I should point out. So while it may be true that Uber pulls through and stems its losses and finds growth and all that, reaching for examples like Alphabet and Facebook is a mistake. Which reminds me, I really do need to finish my post explaining why Amazon’s unprofitability during its youth is no excuse for money-losing unicorns to continue to lose money. Next time!

Illustration: .

The quarterly results of Amazon, Microsoft, and Alphabet were impressive, with each firm bringing in both more revenue and profit than analysts had expected. And, as we explored at the time, the companies managed to come up with their wins in unique fashion. And so it goes this time around as well.

Since then, Facebook and Apple reported their own results, continuing the trend of top- and bottom-line beats from the leading United States-based tech outfits.

The Big 5, as we call them, are now worth not merely $3 trillion, a milestone we marked some time ago, but roughly $3.3 trillion, more than 10 percent higher than that previous high-water mark.

“What is going on?” is a fine question to ask. First, let’s quickly remind ourselves about what the first three-fifths of the Big 5 recently accomplished, and then dive into the results of the last two firms.

These happy days in tech won’t last forever, but in the third quarter of 2017, it was a good time to be an incumbent platform company.

First Three

To briefly review, the first of the Big 5 to report had notable quarters. To keep this short and reasonably sweet, we’ll move in bullet points for now:

• Microsoft’s revenue beat ($24.5 billion over a projected $23.56 billion), and earnings-per-share (EPS) beat ($0.84 over $0.72) came amidst the firm meeting its cloud computing revenue promise ahead of schedule. The company’s amalgamated “Commercial Cloud” run rate hit the $20 billion mark, implying – based on how Redmond tracks the metric – that the various constituencies of that cloud cohort generated at least $1.66 billion in revenue during the last month of the quarter. The firm had previously promised to reach the $20 billion run rate threshold sometime inside the next several quarters. Cloud matters for Microsoft because it’s the company’s route to mostly-predictable recurring revenue, making it the opposite of one-off license sales of Windows operating system.
• Amazon beat expectations with revenue of $43.7 billion (expectations: $42.14 billion) and EPS of $0.52 (expectations: $0.03). This demonstrated two things for the Seattle-based ecommerce-entertainment-cloud consortium: that it is not doomed to slow growth (on a percentage basis), and that it can make money even as it continues to grow. The firm’s year-over-year revenue growth rate accelerated from 29 percent in the year-ago quarter, to 34 percent in its most recent quarter. And that second number was reached from a higher footing. Of course, buying Whole Foods didn’t hurt, but Amazon managed to earn more profit at the same time that it accelerated growth, which in business is a winning competition.
• Alphabet’s $27.8 billion in revenue beat expectations of $27.2 billion, while its EPS came in at $9.57, miles ahead of the expected $8.33. What went so right? In the quarter, Alphabet’s Google unit managed to halt the sequential decline in its per-click revenue. Put more simply, in the third quarter, Google’s cost-per-click went up from the second quarter. It was still down on a year-over-year basis, but for Google, which has reported rising ad clicks and falling click prices for some time, the change was notable. Google sold more ads, and at a price that rose a full percent from the preceding quarter. That’s a sea change.

The path that each firm took to beating expectations was different, but each led to resounding success, at least when it comes to beating expectations. Of course, the Nasdaq Composite didn’t get to over 6,000 by accident, but Big Tech’s initial victory lap even at market highs was almost surprising.

But, it was an open question as to whether Apple and Facebook were positioned to match the previous three’s success.

Last Two

The streak continued. Apple and Facebook both managed to rocket through analyst estimates, capping off a quarter of across-the-board wins for tech’s largest domestic players.

We’ll repeat our prior formatting to save us from having to come up with something more creative:

• Apple , reporting revenue of $52.6 billion, over . Its EPS came in at $2.07 per share, ahead of estimates of $1.87. The firm’s iPhone, iPad, and Mac sales all rose during the quarter, while its Services revenue category reached $8.5 billion in top-line. Heading into the critical holiday quarter with better-than-expected results from the previous quarter and two new phones on the market, Apple seems to be on strong footing. Investors agreed. To that point, Apple is worth $174.67 per share today, putting its market cap (via Google Finance) at $902.2 billion. That’s spitting distance from $1 trillion.
• Finally, Facebook. Facebook, the youngest of the Big 5, reported , down from a year-ago growth pace of 59 percent. Still, its revenue of $10.3 billion beat expectations of $9.84 billion, and Facebook’s EPS of $1.59 was far ahead of the anticipated $1.28 figure. The company also continued to grow both its user base and revenue-per-user during the period. However, Facebook signaled that forthcoming efforts to help prevent the platform from being weaponized by antagonistic nation-states would ding its future profits.

While that final sentence might sound a bit out of place, it underscores something that I think we often forget. Namely how big these companies in fact are: Facebook has nearly 1.4 billion daily active users, Google is the key path to information for much of the world, Amazon wants to take over how you purchase everything, Microsoft is cementing its SaaS products in homes and offices around the globe, and Apple makes so much money that its earnings reports are almost hard to read.

But are the good times for the big shots good for everyone? Perhaps not.

What About Startups?

TechCrunch recently raised the question of “,” arguing that the wave of vibrant startup-led technology change has passed for the time being. Not that it won’t ever come back, of course, but ask yourself if the following declaration doesn’t sound about right:

“[w]e live in a new world now, and it favors the big, not the small. The pendulum has already begun to swing back. Big businesses and executives, rather than startups and entrepreneurs, will own the next decade; today’s graduates are much more likely to work for Mark Zuckerberg than follow in his footsteps.”

The piece details its own set of whys – after “back-to-back massive worldwide hardware revolutions” that “there is no such [new] revolution en route” – but our above work should supplement the argument. The biggest tech companies are only cementing gains and stacking cash when times are good and smaller, disruptive players have the most access to capital that they have had since the DotCom era. And if they can do that when times are good for everyone, what happens when feast turns to famine?

When the bull cycle flips, and it always does, imagine how it may affect the current, rather pleasant status quo. It isn’t too far a stretch to guess that the big companies will be sitting on profitable bottom lines with huge cash reserves when it happens. And they may do so while still-private, still-unprofitable concerns have to deal with waning interest from tech investors.

We’ll check back in after the fourth quarter closes.

Uber had another awkward weekend after its former CEO unilaterally appointed two new members to the firm’s board. The move surprised the unicorn’s new CEO and extant board.

But, from that situation has come two votes, . First, that the firm will accept Softbank’s massive investment and its companion governance changes. (That round will also provide a stiff slug of secondary for prior shareholders alongside raising a billion or more for Uber proper.) Second, :

In addition, directors approved a resolution for Uber to go public by 2019, the people briefed on the meeting said, setting up what could be one of the largest technology stock offerings in years.

If you thought that the Snap Inc. IPO was a goat rodeo, prepare for a real circus.

To remind ourselves, we have a decent look at the broadest swaths of Uber’s business: Its gross ride sales, its effective revenue, and its heavily adjusted losses. (In the case of Uber, we want to use its adjusted revenue, as that figure better accounts for UberPool top line.)  The numbers break down like this:

• $8.7 billion in Q2 gross bookings (Q1: $7.5 billion)
• $1.75 billion in Q2 adjusted revenue (Q1: $1.5 billion)
• $645 million in adjusted net loss (Q1: $708 million)

Throw in uncertainty regarding self-driving cars, rising competition both domestically and abroad () and Uber has a lot of work ahead of it to get public by 2019’s kickoff. The good news is that Uber has wrapped its third quarter like everyone else.

We should get new numbers from them in about a month. Start placing bets.

From the :

 Global VC investing soars in Q3

• Global venture investment is at its highest point since the Dot-Com bubble, according to Crunchbase projections for the third quarter of 2017. Both deal counts and dollar volume are hitting multi-year highs, with total investment projected at around $60 billion, up over 30 percent from the second quarter. Read our full Q3 global investment report here.

Uber settles issues as it eyes IPO

• board approved a raft of measures that move the ride-hailing giant closer to becoming a public company. Directors voted to move ahead with a proposed investment by SoftBank, to eliminate super-voting rights, to expand the board, and to set a goal of going public by 2019.

Infinidat raises $95M for data storage

• , a provider of petabyte-scale data storage technology to large enterprises, closed a $95 million Series C financing round that values the company at $1.6 billion. Goldman Sachs Private Capital Investing led the round, with participation from TPG Growth.

Boston Scientific buys Apama Medical

• Boston Scientific is acquiring , a developer of catheters used in treating heart rhythm disorders, for $175 million up front and up to $125 million in milestone payments. Campbell, Calif.-based Apama previously raised $35 million in venture funding.

According to a , Google, a component of the Alphabet collective, “floated an offer of at least $30 billion to buy Snap in early 2016.”  The timing of the purported offer and its scale is interesting.

Follow Crunchbase News on &

Since Snap was kind enough to turn down the alleged offer and go public, we can take a peek at its numbers from the time frame during which Google was snooping around with a checkbook. From there, we can determine how much Google nearly overpaid for the asset.

And So It Begins

In piece, he makes a few notes concerning timing. First, Google’s tender came in “early 2016.”

That’s good, but Heath narrows a bit as well:

Google’s initial offer would have been discussed just before Snap raised its Series F round of private funding in May 2016, valuing the company at $20 billion. CapitalG, the growth equity fund managed by Google’s parent company, Alphabet, ended up .

That , to refresh our minds, raised $1.8 billion for Snap at a pre-money valuation of $17.5 billion. In total, Snap was worth around $19.3 billion when it was completed.

Google was, therefore, willing to pay quite a lot more for the whole company than private investors were willing to pay for part of it. (That’s not surprising. Buyouts tend to come at a premium to current asset prices. In this case, the best comp we have for the current price of Snap is the firm’s next-private value.)

So Google was willing to pour oceans of cash onto Snap back when it was earlier in its monetization cycle. Let’s look back.

How Mature Was Snap?

Snap’s Series F was announced in the second month of the second quarter of the year. Presumably, it was wrapped up a bit before it became known. As such, it’s a bit hard for us, at this distance, to decide which quarter is the more effective metric to use as a reference point. Put more simply, if we want to understand how much Google was willing to pay for Snap, we need to understand how much revenue the smaller company was generating at that time.

If we choose the first quarter, we are selecting a more conservative — smaller, in this case — figure to use as the denominator in our impending price and sales multiple. If we choose the second quarter, we are using a metric that includes performance ���ڳٱ����the deal was made. Luckily, we are kind souls here at Crunchbase News, and it’s Friday. We’ll be liberal in our approbation of  growth and go with the second-quarter number.

Now, what we want is that number’s trailing result. So we’ll add up the second quarter of 2016 and go back three more quarters. That works out to revenue of just over $160 million. Not bad, given that the figure is a huge multiple on what Snap generated in the preceding twelve months.

Quickly, if Google was willing to drop 30 billion dollars on the company, it would have paid an effective revenue multiple (price/sales) of 187.5.

For comparison, some industries have groups of players that trade for a price/sales multiple of less than one. In tech, SaaS companies can trade for 5 to 10 times revenue, and not be too far out of whack. But Snap was something unique, and it was growing fast. Those facts drive up the price.

So how much too much was Google’s offer?

Far too much, as we can see now from our time-afforded distance. Private investors slapped the $19.3 billion value on Snap around the same time as the Google offer.

The Series F round, using our same revenue result, worked out to a revenue multiple of 121 or so at the time. That is still very high, but it is smaller than what Google was willing to dosh about.

Today, Snap is worth just 30.74 times its trailing revenue, according . That the firm’s price over sales multiple has come down as the firm’s growth has decelerated is the opposite of surprising. But what is notable is the far-higher ratios investors, and a public company, were willing to pay for the firm just over a year ago.

Everyone got it wrong, it seems. Snap today is worth $15.84 billion. A huge sum, and precisely nothing to sneeze at. Still, it’s far less than what it managed to garner before.

�������ܲ��ٰ����پ��Dz�:��