Elon Musk’s Boring Company Eyes $20 Billion Valuation in New Funding Round
The tunneling startup is in talks to raise around $4 billion from investors
- Elon Musk’s Boring Company is in talks to raise around $4 billion in new funding at a valuation of about $20 billion, according to sources.
- Boring Company was previously valued at around $5.7 billion after a 2022 funding round that raised $675 million.
- While many of Boring Company’s pitched city projects haven't panned out, it has new loops under development in Nashville and Dubai.
Elon Musk’s tunneling startup, the Boring Company, is in talks to raise new funding that would value it at around $20 billion, according to people familiar with the discussions.
The company is in talks to raise around $4 billion, some of the people said. The funding round hasn’t closed and the people cautioned that the terms could change.
Steve Davis, president of the Boring Company, didn’t respond to requests for comment.
The company builds tunnel boring machines that it claims can dig underground more cheaply than traditional construction companies. The startup, which spun off from SpaceX SPCX -2.68%decrease; down pointing triangle in 2018, owns a transportation network under the Las Vegas Strip in which drivers ferry passengers in Teslas to and from the Las Vegas Convention Center.
Boring was valued at around $5.7 billion after a 2022 funding round. That round raised $675 million from investors, including Vy Capital, Sequoia Capital and Founders Fund.
The company has pitched privately funded projects in cities including Baltimore, Chicago and Los Angeles, where the startup stood to make money from ticketed passengers using its underground transit system. Many of those projects haven’t panned out.
Still, many private-market investors see investments in Musk’s companies as sure bets and are willing to pay premiums for access to his portfolio.
Investors who backed Musk’s $44 billion takeover of Twitter had been underwater for months following the 2022 deal. But they eventually made money after the billionaire entrepreneur rolled the struggling social-media company into his artificial-intelligence startup xAI, and later folded the entity into SpaceX.
Valuations of Musk’s public companies Tesla and SpaceX have tumbled in recent days. Tesla shares fell 15% on Thursday. That erased $215 billion in market value after the electric-vehicle maker missed earnings targets and reported negative cash flow for the first time in two years.
Musk’s rocket company SpaceX went public in June in a record-setting IPO that raised $86 billion from Wall Street. Its market cap nearly doubled in the days after the offering before the shares fell around 50% from their peak in recent days.
Boring has a new loop under development in Nashville, which it is privately funding.
In February, it announced a new project to create an underground loop in Dubai. The company said the first four-mile phase would cost $154 million and take a year to complete. A second phase—expanding the route to 14 miles—is expected to take three years and cost $545 million. It’s unclear who will pay for the development of the project.