Apple to buy Drive.ai
(Bloomberg) -- Apple Inc. is preparing to buy startup Drive.ai in a small deal that will bring more engineers with experience in autonomous vehicle technology to the iPhone maker, according to people familiar with the matter.
It’s unclear how much Apple is paying. Drive.ai has raised about $77 million in funding since it was founded in 2015, and was valued at about $200 million in 2017, according to Pitchbook data.
The deal is a so-called acqui-hire, where larger technology companies buy small startups to gain talent. Apple is planning to pick which Drive.ai staff it wants to keep, and the tech giant won’t be using any intellectual property from the startup, the people said. They asked not to be identified discussing private matters. The Information reported on the deal earlier this week. Apple and Drive.ai didn’t respond to requests for comment.
"We believe the potential acquisition price would be below their last $200M valuation," Gene Munster, a veteran Apple analyst at Loup Ventures, wrote in a research note.
Drive.ai has been for sale for a while and the startup has struggled to gain traction, according to a person familiar with the firm. It has a limited number of pilot tests. One contract with Frisco, Texas, was not renewed after the city cited high costs, VentureBeat reported in March. There may only be a handful specialists from the startup who can help Apple because the tech giant’s driverless vehicle technology is already way ahead of Drive.ai’s, the person added. They asked not to be identified discussing private matters.
Apple has been working on autonomous driving technology for several years. The project has had its ups and downs. The company cut about 200 workers from the initiative recently, but it also said it is committed to the area.
"Apple’s primary ambitions in autonomy lie in the broad application of autonomous systems and related services," Munster said. "Their potential acquisition of Drive.ai would bring a new crop of engineering talent to aid in these efforts, but we do not expect a consumer product or service from Apple for 4+ years."