Amazon reported last week that it is buying Zoox. The company is an autonomous vehicle startup backed by a reported $1 billion in venture capital. Zoox was valued at $3.2 billion, after a recent round of funding. Amazon is paying $1.2 for the startup.
Even with the valuation discount, it is reported that most of the Zoox investors are getting their money back, and some could also enjoy positive returns.
The biggest deal since Whole Foods
The deal is potentially the biggest Amazon acquisition since their Whole Foods deal if the reported $1.2 billion price tag is accurate. The company did not go into too many details about the plans they have for the startup.
However, in a press release, Amazon said that Zoox’s Chief Executive Aicha Evans and Chief Technology Officer Jeff Levinson would continue to lead the team in innovation and drive towards their mission.
This probably means that the startup will most likely follow their original roadmap in terms of development. California-based Zoox, named Foster City, worked toward building its own electric vehicle and autonomous driving software for it.
Amazon could disrupt the autonomous vehicles market
So far, the startup has kept most of the details of what they are doing secret. In a 2018 Bloomberg report, some details were provided. The indication was that they had an early prototype that was described as looking like the rear halves of two Mini Coopers welded together, with no steering wheel inside.
The plan that Zoox has involves making their self-driving vehicles available to the public, using an Uber-like service. Amazon’s strategy could be to expand into the new market of self-driving taxis. They could use the technology, not just for the taxi-hailing services but for logistics in self-driving technology for delivery of their products.
The options are to have an external company supply them with this service or build it themselves. It seems like they went with the DIY option.