Dive Brief:
- PlusAI and Texas Ventures Acquisition III Corp. have entered into a definitive agreement to combine operations to become a publicly traded company, according to a Sept. 3 announcement. The merged businesses will operate as PlusAI.
- The move follows a mutual decision in April between the developer of autonomous driving technology and Churchill Capital Corp IX to terminate a merger agreement due to market conditions at that time.
- PlusAI’s latest merger deal could provide the firm with $300 million in capital, including more than $60 million in committed financing and another $236 million set aside in a trust to support the company’s plans for a commercial launch of factory-built autonomous trucks in 2027, per the release.
Dive Insight:
PlusAI is projected to have an approximately $800 million valuation, and existing operations along with capital from the deal should provide an operating runway through 2027, Troy Rillo, CEO of Texas Ventures III, said on the investor call.
Autonomous trucking appears to be gaining momentum, investment bank TD Cowen said in a July investor note about Aurora Innovation, another firm advancing and working to scale self-driving truck technology. Regarding the autonomous trucking industry overall, TD Cowen said “AV Trucking is a sizable and compelling AV vertical due to narrower ODD and business model considerations.”
However, TD Cowen cautioned the autonomous trucking segment was still in the early stages and faced significant execution risks.
PlusAI has continued to advance its plans toward commercialization even following an unsuccessful attempt to go public earlier this year.
David Liu, co-founder and CEO of PlusAI, said during an investor call that with the company generating revenue, it’s proved the technology works.
“Now we are focused on scaling toward commercial deployment,” Liu said.
The company generates revenues through its software platform HyperFoundry, which is also the foundation of its SuperDrive autonomous driving system, another cash stream, Liu said. He said Hyperfoundry is generating revenue for the company today and represents future annual revenue opportunities ranging between $50 million and $100 million.
SuperDrive also provides long-term revenue upside through a recurring driver-as-a-service model targeted for commercial launch next year, the company said in the release.
Liu said on the investor call that with the trucking industry facing driver shortages and rising operational costs, “autonomous trucking represents one of the most compelling opportunities to address these structural challenges.”
This is what led PlusAI to Texas Ventures III, Liu said.
Rillo said in the investor call that PlusAI is addressing a massive global market including increasing freight demand.
“The company has spent more than a decade building its technology platform and is now demonstrating tangible commercial progress,” Rillo said. “We believe PlusAI is entering the most exciting chapter in its history.”
