Uber founder Travis Kalanick raises $1.7bn for new start-up
Andreessen Horowitz and the ride-hailing group join funding round
Uber founder Travis Kalanick has announced a $1.7bn debt and equity funding deal for his latest venture, to build a “computer for the physical world”, backed by venture firm Andreessen Horowitz and Uber itself.
Tech investor Ben Horowitz, co-founder of the venture firm leading the funding round for Kalanick’s new venture Atoms, will also join the start-up’s board. Goldman Sachs and JPMorgan are among the banks lending to the start-up as part of the deal.
Kalanick has pursued several new businesses since he left the ride-hailing group in 2017 following a boardroom clash. He is still involved in CloudKitchens, a network of “dark kitchens” designed to serve food delivery apps that he has run since 2018.
On Wednesday, Kalanick said that the fundraising round would support Atoms’ work to automate industrial processes by deploying advanced robotics in a number of sectors.
“Mining, construction, heavy transport, food production are just a few examples of atom-heavy industries awaiting massive digital transformation,” Kalanick said in a blog post. “Industrial AI is getting ready to power the next Industrial Revolution.”
Kalanick renamed real estate group City Storage Systems as Atoms when he launched the new business in March.
Horowitz said Atoms was “the realisation of Travis’s multi-decade long vision and ambition to digitise the physical world”.
“It takes a rare kind of entrepreneur to change these old-school, heavy parts of our economy,” he said in a blog post. “They need a gritty work ethic, drive, and range that spans across domains, from software architecture to mechanical engineering. Travis is that guy.”
During Kalanick’s tenure at Uber, the company suffered from reports of managerial dysfunction. Former engineer Susan Fowler accused Uber under his leadership of fostering a culture that turned a blind eye to sexual harassment and discrimination.
A boardroom clash ensued and, following a scathing report by former US attorney-general Eric Holder in 2017, the Uber co-founder stepped down.
CloudKitchens has also been at the centre of complaints around cultural issues, the FT previously reported. The company in 2023 made lay-offs and closed several locations in a bid to rein in expenses.
Kalanick sold his final shares and stepped down from Uber’s board in 2019. The new deal comes as the company he founded is grappling with a growing challenge from “robotaxis” such as those made by Alphabet’s Waymo.
Uber has made a series of investments in self-driving vehicle start-ups including Nuro, Wayve and Waabi.
Pronto, an autonomous vehicle company serving the mining industry that was founded by former Uber engineer Anthony Levandowski, is also now part of Atoms after Kalanick acquired the company in April.
In 2020, Levandowski was sentenced to 18 months in prison for stealing trade secrets from Google when he joined Uber. He was later pardoned by US President Donald Trump.
Kalanick said on Wednesday that he regretted not partnering with Andreessen in the past and that Uber suffered by not having the venture firm on its board during the period when he was ousted.