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Hello friends and welcome readers, and welcome back to The Station, a newsletter covering both current and developing methods of moving people and goods from one location to another.

Last week, I requested your input on the most significant stories of the year. While responses varied, two key themes related to startups consistently appeared: the impact of COVID-19 and the challenges it presented to businesses, alongside the surprising number of deals that took place in spite of the pandemic.

Special Purpose Acquisition Companies (SPACs), Tesla’s substantial increase in stock value, the public launch of Waymo’s autonomous ride-hailing service in the Phoenix metropolitan area, Uber’s transformations in 2020 (which I discussed last week), and Amazon’s purchase of Zoox were also mentioned.

Regarding Zoox, I published an article last week featuring my conversation with Jesse Levinson, the co-founder and Chief Technology Officer of Zoox. Accessing the full article requires an EC subscription, so I’d like to share a noteworthy point from the interview that I found particularly insightful.

I inquired with Levinson about his expectations regarding federal regulations. Specifically, whether he anticipates the formalization of concrete guidelines. Here is the exchange.

LEVINSON: We are actually in a favorable position concerning federal regulations. Our vehicle has been engineered to meet Federal Motor Vehicle Safety Standards (FMVSS), and we are conducting crash tests to satisfy all of those requirements. We have successfully completed the majority of these tests and passed each one attempted, meaning we are not currently facing any obstacles at the federal level.

We will observe how the incoming administration influences the future of regulations, but currently, we are prepared to proceed.

YOURS TRULY: Does that mean you don’t require a federal exemption? Your vehicle does not include a steering wheel.

LEVINSON: Yes, we have designed our vehicle to be compliant with the FMVSS. Therefore, we were not seeking an exemption.

ME AGAIN: Is this possible because your operational speed will remain below 25 miles per hour? I believed that a vehicle lacking a steering wheel would not meet compliance standards. How is this achieved?

LEVINSON: I would simply state that is not our understanding of the standards.

Subscribers: please see the final section of the newsletter for additional context. 

Feel free to contact me at kirsten.korosec@techcrunch.com with any feedback, critiques, opinions, or information. You can also reach out via direct message on Twitter — @kirstenkorosec.

Deal of the week

The latter part of 2020 witnessed a surge in acquisitions, mergers, and funding initiatives, a notable shift from the uncertainty experienced earlier in the year as the COVID-19 pandemic caused market instability.

A particularly strong area in 2020 was the delivery sector. Companies specializing in delivery services – encompassing trucking, automated robots, and aerial solutions such as drones – successfully attracted new investment, while many others faced challenges.

However, the pandemic did present delays and difficulties for delivery companies. Consider the case of Zomato, an Indian food delivery service.

The company, established 12 years ago, recently secured $660 million in a Series J funding round. Participants in this round included Tiger Global, Kora, Luxor, Fidelity (FMR), D1 Capital, Baillie Gifford, Mirae, and Steadview, resulting in a post-money valuation of $3.9 billion for Zomato.

Originally, Zomato had planned to finalize this funding round 11 months prior. Various factors, including the ongoing pandemic, contributed to delays in the fundraising process. Ant Financial, initially intending to invest $150 million, ultimately provided only a third of that amount.

Further investment is anticipated for Zomato as it prepares for a public offering in 2021. Deepinder Goyal, co-founder and CEO of Zomato, stated that the company is also finalizing a $140 million secondary transaction.

Having acquired Uber’s Indian food delivery operations earlier this year, Zomato is strategically strengthening its financial position to compete with Swiggy and the emerging presence of Amazon in the market.

Other deals that stood out this week …

AutoLeap, a Toronto-based startup founded six months ago, announced a $5 million seed funding round in September, spearheaded by Threshold Ventures. The round also saw contributions from individual investors including Shift co-founder George Arison, former General Motors CEO Rick Wagoner, and former Bridgestone executive Ned Aguilar.

Bolt, an Estonian company developing an on-demand network for transporting individuals and goods via cars, scooters, and bicycles, secured €150 million ($182 million at current exchange rates) in an equity funding round. CEO and co-founder Markus Villig emphasized the company’s focus on expansion, with the goal of becoming the leading provider of electric scooters in Europe, currently operating in 200 cities across 40 countries.

Boom Supersonic obtained $50 million in new funding, led by WRVI Capital, achieving a post-money valuation exceeding $1 billion, as reported by Bloomberg.

Cargo.one, an air cargo booking platform, raised $42 million in a Series B funding round, with Bessemer Venture Partners taking the lead. Existing investors Creandum, Index Ventures, Next47, and Point Nine also participated, following an earlier $18 million Series A round this year.

CarGurus, an online automotive marketplace, reached an agreement to acquire a 51% stake in Plano, Texas-based CarOffer, at an enterprise valuation of $275 million. The deal includes an option for CarGurus to purchase the remaining equity in the company within the next three years. CarOffer provides an automated instant vehicle trade platform as an alternative to traditional wholesale auctions.

GoFor Industries, a Canadian delivery company, secured CA$20 million in a Series A funding round to support its expansion into the United States, according to Freightwaves.

Motorq, a connected car API provider, raised $7 million in a Series A round led by Story Ventures, with participation from existing investors FM Capital and Monta Vista Capital. Avanta Ventures, the investment arm of CSAA, also joined as a new strategic investor.

Motorq has developed a cloud-based system that captures and monitors data from a vehicle’s onboard computers, then applies analytics and machine learning. The system contextualizes these analytics and delivers them to customers through application programming interfaces (APIs) and other tools. Data points include vehicle location, charge/fuel consumption, driver behavior, safety alerts, maintenance notifications, and remote control capabilities.

Volcon ePowersports raised $2.5 million through public funding via the WeFunder platform, bringing their total funding to over $4.5 million since September through a seed round and WeFunder. These funds will be allocated to the continued development of Volcon’s production facilities and assembly lines. Volcon is focused on building and delivering an all-electric off-road motorcycle, the Grunt, in Spring 2021.

Vroom, an online used-car retailer, agreed to acquire Vast Holdings Inc., including Austin-based vehicle listings platform CarStory, for $120 million, as reported by Automotive News.

Uber ATG-Aurora integration

Aurora Innovation, a company focused on autonomous vehicle technology, is swiftly working to integrate with Uber Advanced Technologies Group. Recently, Aurora announced the acquisition of Uber’s self-driving division through an agreement resulting in a combined company valued at $10 billion.

Chris Urmson, CEO of Aurora, extended employment offers via email on Thursday to over 75% of the personnel currently working at Uber ATG, as reported by an individual with knowledge of the integration following the acquisition. This represents more than 850 employees. Should all offers be accepted, Aurora’s workforce will more than double in a single day.

The Uber ATG location in Toronto, consisting of approximately 50 employees involved in the subsidiary’s research and development activities, was not included in the acquisition, according to a source. Additionally, Raquel Urtasun, the chief scientist of Uber ATG who oversaw the R&D team, will not be joining Aurora. Urtasun is a recognized authority in machine perception for autonomous vehicles, and also holds positions as a University of Toronto professor, a Canada Research Chair in Machine Learning and Computer Vision, and a co-founder of the Vector Institute for AI.

The announcement of the Toronto facility’s closure has led some venture capitalists and entrepreneurs to express their astonishment that Aurora did not prioritize Urtasun and the R&D team as key individuals to incorporate into the newly formed company. The extent to which they attempted to do so is currently unknown. However, based on communications received, it appears Urtasun is already receiving job proposals from multiple other companies in the autonomous vehicle sector.

A Further Development in Regulations

An interesting development emerged this week that will undoubtedly be of significant interest to those involved in policy creation at any company developing autonomous vehicles intended for use in the United States.

The National Highway Traffic Safety Administration recently released a notice providing clarification regarding AV policy. Before a detailed examination, a concise overview of the existing legal framework is helpful.

Currently, all motor vehicles are required to adhere to all applicable federal motor vehicle safety standards (FMVSS), establishing a baseline level of performance. However, recognizing that the “driver” can be a system comprised of hardware and software – though this is a simplification – prompts consideration of whether a vehicle truly requires conventional physical controls like a steering wheel, which a robotic system would not utilize.

This notice represents a shift from previous positions taken by NHTSA, particularly a letter of interpretation issued in 2016 to Chris Urmson, then leading Google’s self-driving car initiative.

That 2016 interpretation presented a challenging dilemma for AV companies aiming to deploy vehicles with innovative designs, specifically those without steering wheels or pedals. NHTSA stipulated that manufacturers must confirm a vehicle’s compliance with all relevant FMVSS and engineer the vehicle to facilitate the execution of every test procedure outlined in each regulation. This proved unfeasible, as certain testing conditions and procedures could not be performed on vehicles lacking standard controls as defined by the FMVSS.

The primary recourse for companies was to request exemptions from these standards.

This new notice not only concedes that the 2016 interpretation was overly restrictive, but it also appears to have eliminated a substantial impediment to the deployment of robotaxis.

Consequently, Levinson’s earlier remarks (mentioned previously in this newsletter) now carry increased relevance. A link to the notice is provided here.