US-based autonomous delivery robot startup Nuro announced that it will furlough 30% of its workforce, or about 340 employees, as part of a restructuring aimed at expanding the capital’s runway.
Recently, Nuro’s co-founder Dave Ferguson and Zhu Jia Army said in a blog post that the company would cut headcount and shift resources from commercial operations to research and development. It’s the second time in less than a year that Nuro, which has raised $2.13 billion, has laid off employees to cut costs. In November 2022, Nuro laid off about 300 people, or 20% of its workforce. This is an open letter from the Nuro co-founders announcing the layoffs.
Today we share how we plan a more capital efficient path to realizing Nuro’s mission.
Nuro’s mission is to make everyday life better through robots. Our first product, Autonomous Community Goods Delivery, aims to improve the lives of millions of people, strengthening communities and the environment in the process. This has been our goal from the beginning and we will continue to work hard on it.
Over the past seven years, we have made significant progress towards this goal. We built a custom fleet of zero-occupant vehicles, developed state-of-the-art AI to drive these vehicles driverless on public roads, and signed commercial partnerships with nationally recognized brands. Each of these achievements will be an important step in building a large-scale autonomous delivery service.
For most of its life, Nuro has operated in a favorable funding environment and has been fortunate to raise significant sums of money from top investors. But over the past year and a half, capital markets in general, and deep tech funding in particular, have fallen sharply. The recent bank failures and talk of an imminent US recession show that this change will not be reversed anytime soon. We have entered a new capital environment that will shape the years to come and beyond. In this new reality, balance sheets need to be managed more efficiently.
There is a fundamental tension in the development of autonomous driving between capital efficiency and speed of initial service buildout. We have invested heavily in developing our commercial services and have learned a lot from our customers. However, commercial deployment comes at a significant cost, both in terms of resources and emphasis on autonomy. And until the unit economics of these services make sense, we think it’s wise to focus on what we can do efficiently as a startup.
Going forward, we will change our approach to building Nuro businesses. To date, we have developed autonomous systems, designed and built custom vehicles, and deployed commercial pilots in parallel with our partners, but we are now pursuing a more sequential development model.
Central to this new approach is a focus on autonomy. Recent advances in AI have increased our confidence and ability to achieve true generalization and extended autonomy more quickly. We have invested in AI and ML since our inception, and much of our autonomy stack is already able to learn directly from data. Our current focus is on making the Autonomy stack even more data-driven so that it can scale even faster into larger operational domains.
In addition, it will postpone its previously planned third-generation vehicle production line, scale back commercial trials in the near term, and explore more efficient deployment models with partners. Our focus on advancing autonomy and accelerating the sequential development of our services provides a leaner model for AV development, with our gliding time from about a year and a half to nearly his three and a half years. It will grow more than twice as long.
Unfortunately, executing on this new roadmap requires making difficult choices about where to focus and where to cut or pause spending. We offered a voluntary severance package to some of our employees last month and will implement planned layoffs later this week. This change is the most burdensome for us. We are deeply inspired by the dedication and passion of our colleagues, and every step we take going forward, we thank our departing colleagues for their hard work and contributions.
We strongly believe that a future where self-driving cars improve our everyday lives is both exciting and inevitable. With our new approach, Nuro hopes not only to weather this economic downturn, but to come out stronger in the reverse. Our mission to make everyday life better through robotics and our product vision to build autonomous local delivery services remain intact, and our dedication and determination to achieve them is stronger than ever.
Recently, Nuro’s co-founder Dave Ferguson and Zhu Jia Army said in a blog post that the company would cut headcount and shift resources from commercial operations to research and development. It’s the second time in less than a year that Nuro, which has raised $2.13 billion, has laid off employees to cut costs. In November 2022, Nuro laid off about 300 people, or 20% of its workforce. This is an open letter from the Nuro co-founders announcing the layoffs.
Today we share how we plan a more capital efficient path to realizing Nuro’s mission.
Nuro’s mission is to make everyday life better through robots. Our first product, Autonomous Community Goods Delivery, aims to improve the lives of millions of people, strengthening communities and the environment in the process. This has been our goal from the beginning and we will continue to work hard on it.
Over the past seven years, we have made significant progress towards this goal. We built a custom fleet of zero-occupant vehicles, developed state-of-the-art AI to drive these vehicles driverless on public roads, and signed commercial partnerships with nationally recognized brands. Each of these achievements will be an important step in building a large-scale autonomous delivery service.
For most of its life, Nuro has operated in a favorable funding environment and has been fortunate to raise significant sums of money from top investors. But over the past year and a half, capital markets in general, and deep tech funding in particular, have fallen sharply. The recent bank failures and talk of an imminent US recession show that this change will not be reversed anytime soon. We have entered a new capital environment that will shape the years to come and beyond. In this new reality, balance sheets need to be managed more efficiently.
There is a fundamental tension in the development of autonomous driving between capital efficiency and speed of initial service buildout. We have invested heavily in developing our commercial services and have learned a lot from our customers. However, commercial deployment comes at a significant cost, both in terms of resources and emphasis on autonomy. And until the unit economics of these services make sense, we think it’s wise to focus on what we can do efficiently as a startup.
Going forward, we will change our approach to building Nuro businesses. To date, we have developed autonomous systems, designed and built custom vehicles, and deployed commercial pilots in parallel with our partners, but we are now pursuing a more sequential development model.
Central to this new approach is a focus on autonomy. Recent advances in AI have increased our confidence and ability to achieve true generalization and extended autonomy more quickly. We have invested in AI and ML since our inception, and much of our autonomy stack is already able to learn directly from data. Our current focus is on making the Autonomy stack even more data-driven so that it can scale even faster into larger operational domains.
In addition, it will postpone its previously planned third-generation vehicle production line, scale back commercial trials in the near term, and explore more efficient deployment models with partners. Our focus on advancing autonomy and accelerating the sequential development of our services provides a leaner model for AV development, with our gliding time from about a year and a half to nearly his three and a half years. It will grow more than twice as long.
Unfortunately, executing on this new roadmap requires making difficult choices about where to focus and where to cut or pause spending. We offered a voluntary severance package to some of our employees last month and will implement planned layoffs later this week. This change is the most burdensome for us. We are deeply inspired by the dedication and passion of our colleagues, and every step we take going forward, we thank our departing colleagues for their hard work and contributions.
We strongly believe that a future where self-driving cars improve our everyday lives is both exciting and inevitable. With our new approach, Nuro hopes not only to weather this economic downturn, but to come out stronger in the reverse. Our mission to make everyday life better through robotics and our product vision to build autonomous local delivery services remain intact, and our dedication and determination to achieve them is stronger than ever.
