Self-driving truck startup Aurora Innovation to sell $420 million in stock ahead of launch

Self-driving technology company Aurora Innovation plans to raise lots of of tens of millions in additional capital because it prepares to bring autonomous vehicles to market by the tip of 2024.

Aurora, which went public in 2021 through a special-purpose acquisition merger, is pursuing a driver-as-a-service model in which carriers buy trucks with Aurora Driver technology on board after which offer their services through those trucks to shippers. But the corporate plans to enter the market as a carrier, offering up to 20 autonomous Paccar and Volvo trucks to shippers later this yr.

According to SEC filing On Thursday morning, Aurora arranged to sell up to $420 million of its Class A typical stock to underwriters Goldman Sachs, Allen & Company and Morgan Stanley. The company made its 2021 public debut through a special purpose acquisition merger, with shares opening at $13.12.

The underwriters have agreed to buy shares from Aurora for $3.4830 per share, which is barely lower than the general public offering price to account for his or her fees and compensation. If the deal goes through on Aug. 2, they may resell the shares to the general public for $3.60 per share.

Aurora’s share price rose nearly 29% to $4.50 after the applying was rejected.

The deal comes a day after Aurora filed a prospectus for the sale $350 million value of shares. An individual aware of the matter told TechCrunch that due to strong investor demand, the offering was increased to $420 million.

Aurora didn’t respond to questions on the way it plans to use the web proceeds, however the filing said the corporate will use the cash for “working capital and other general corporate purposes.” What meaning, even Aurora may not know. The company also wrote in its filing that it’s going to first invest the proceeds from the offering in “short-term and long-term investment vehicles, certificates of deposit or guaranteed obligations.”

The offer to raise additional funds comes as Aurora reports second-quarter results. As of June 30, 2024, Aurora had $402 million in money and money equivalents and $618 million in short-term investments. Excluding the proceeds from the offering, the corporate expects this to be enough to fund operations through the fourth quarter of 2025.

In the second quarter of 2024, Aurora spent $198 million, which is a direct loss because the startup is just not yet generating any revenue.

So unless Aurora attracts significant interest or earns a profit on its short-term instruments, the startup can have to significantly reduce its money burn to save $402 million over the subsequent six quarters.

Perhaps Aurora is counting on future revenue to offset its costs. The company is ready to begin business service on the Uber Freight network later this yr. In June, the 2 corporations announced a multi-year partnership that can see Aurora’s self-driving technology offered on the Uber Freight network by 2030.