9 ms·

Autonomous trucking upstart Embark has gone from $5B+ to basically worthless

101 points by donsupreme 4y ago

O__________O 4y ago
>> The projected date of actual deployment isn’t too far off, either. Embark said it intends to commence commercial operations in 2024. Based on what specifically, at what cost once launched, how much will they charge, how much will the cheapest non-autonomous competitor cost, etc?
- UncleEntity 4y ago
  They are basically trying to replace trains with their less efficient robotrucks driving between “transfer facilities”. Anyone who needs it “just in time” loads it on a truck and the ones who don’t throw it on a train, generally speaking. In order for them to compete they would have to be somewhere in the middle price wise which, theoretically, shouldn’t be all that hard if they don’t have the cost of a driver. Minus the costs of all the trucks that are going to get disabled once people figure out they can be easily hijacked out in the middle of Texas. I’d imagine this will be a lot harder now since they won’t have VC money to subsidize their business model and have to compete in a highly regulated market where the DOT will shut them down in a heartbeat if they get up to the usual Silicon Valley tricks.
nowherebeen 4y ago
So they tried to offload shares to the public before actual deployment and failed?
- deleted 4y ago
  [deleted]
FlyingSnake 4y ago
This is why the whole “Unicorn” schtick looks like a scam. If these pie in the sky valuations can fluctuate so wildly, why should they be trusted?
- seanmcdirmid 4y ago
  High pay-out = high risk? The lottery ticket with a $5 billion pay out is still a lottery ticket.
- JumpCrisscross 4y ago
  > these pie in the sky valuations can fluctuate so wildly, why should they be trusted? They shouldn’t. Valuations are analogised to market cap. This is almost more idiotic than the crypto convention. Multiplying the price paid for Series F preferred stock by the number of common shares is asinine. They’re different securities. In a bill market, the mistake is subtle. In a bear market, the lie is revealed.
- TulliusCicero 4y ago
  > why should they be trusted? They shouldn't be, not as a general rule anyway. Though as a general principle, what happened here was just, "some rich people thought <company> would be worth a lot of money, and then they were wrong." Nothing super shocking here, obviously that will happen all the time.
  - FlyingSnake 4y ago
    That’s my metric as well and I feel all this discourse around putting “unicorns” on a pedestal disingenuous.
vadym909 4y ago
Seems like SPACs have been a race between getting ‘discovered’ as worthless and unloading owner and VC equity to the public at high valuations.
ejanus 4y ago
So not only crypto-focused firms are becoming worthless.
- nowherebeen 4y ago
  Crypto startups are only a symptom, the problem is much deeper with startups in general. Tons of non-crypto startups don’t generate a profit. They have all been burning VC money and this was okay because they were able to offload the shares to the public. The party is now over and we are going to start seeing lots of startups fail.
  - rurtrack 4y ago
    I mean, by definition, lot of startups fail
ralph84 4y ago
> the company holds no patents How can you work on something as nascent as autonomous trucks for six years and not come up with even a single unique idea?
- oxryly1 4y ago
  I’m not sure the correlation between patents and innovation is quite so well established.
  - iancmceachern 4y ago
    Every hardware company, companies that make physical hardware, hinges on this. It's viewed as key to raising any kind of money, it's a cost of entry. Typically companies I hardware will have dozens or hundreds of patents, it's just key. Look at how many patents tesla has, vs this, and one has been successful one not. If you were raising money from serious investors for a hardware project and said you don't have any patents, you should be laughed out of the building. It's what your selling, it's a key part of the ip moat.
supernova87a 4y ago
Does anyone have (or has anyone read) any smart summary/analysis about the phase we find ourselves in with the autonomous driving industry? Is it like CVML was in a desert for some decade(s) where there were no big advances, but lots of hope and unrealized claims of some impending breakthrough, only for lots of money to be dumped into it, and companies to be led astray? Are we waiting for some major improvement in algorithms, or hardware, like GPU progress, and things will suddenly take off? Or are there fundamental difficulties that are startups (and their researchers) keep banging their heads against thinking that they're the ones to be able to solve it? Or just that they need to go through the same mistakes over and over but make little progress? It seems to have been a decade and what, $20B poured into this, but we are really not much closer to the goal? (and I'm not even sure whether we mean solving the AV problem, much less achieving a viable business model) Sure Waymo is driving in San Francisco, but that seems like a very handheld single example.
- lnsru 4y ago
  It’s closer to 3 decades today starting with European project: https://en.m.wikipedia.org/wiki/Eureka_Prometheus_Project https://en.m.wikipedia.org/wiki/Eureka_Prometheus_Project Looks like, that some problems can’t be solved just throwing money at them. Modern hardware is light years away from the one in Prometheus Project. Radars, lidars and cameras are superior now. Heck one can design and build dedicated ASIC for cheap nowadays. Maybe taking Nvidia Drive and tweaking it is just not enough to get there.
- dvh 4y ago
  Autonomous driving is in "principally works but lawsuits haven't started yet" phase.
- thrashh 4y ago
  The way I think about is that when we drive as humans and an obstacle appears, we have over 15 years of knowledge that we have to determine our next step. And we coalesce a lifetime of knowledge in a matter of seconds. These modern algorithms do not try to implement general AI. They do not work with 15 years of knowledge. They just recognize some patterns with no understanding of what they’re are looking at. It’s a different and easier approach but I think it has some severe limits that will never be overcome. To me it’s like a software programmer that copies Stack Overflow snippets but doesn’t really understand programming. They get only so far
lnsru 4y ago
Why I can’t see autonomous city bus companies. The speed is slow, route is rather short and predefined. April tags or UWB radio location beacons can be placed in cost efficient manner. Every city is screaming loud, that they can’t find enough drivers.
- jnwatson 4y ago
  Driving a bus is a tactically complicated job. The rules of the road in a major city are already a little soft. They are doubly so for buses. They park where they must, and sometimes use their size to bully their way in. City buses will be the last to go automated.
  - lnsru 4y ago
    I see often dedicated bus lanes around. And sometimes dedicated traffic lights for them. It’s difficult job, but that automatically brings the need for automation. I don’t know much people who want this low pay extremely high stress job. Some blue collar workers went for subway train driver’s career. It’s much easier.
    - bombcar 4y ago
      That is (or can be) what's called bus rapid transit - basically build a train line but use busses. They could probably be significantly automated, but I don't know that the cost would be worth it, as even the best ones still interact with normal traffic at times.
    - whimsicalism 4y ago
      > Some blue collar workers went for subway train driver’s career. It’s much easier. Shouldn't that be automated first?
      - lnsru 4y ago
        I think it’s already automated when the line planing was good. However some places like Munich have terrible delays and all the strange things not allowing getting on time by subway.
ignoramous 4y ago
> The company joined the Y Combinator accelerator's 2016 batch with the initial intent of building self-driving shuttles for use on college campuses. As a change from constantly drumming up YC founders and companies who do make it (some usually off of similarly inflated valuations), it'd be interesting to see if they do talk about just how and why unicorn startups like Embark (seemingly) lose their way. That's not to say YC is particularly at fault.
- landemva 4y ago
  Transportation vehicles are outside their wheelhouse. This auto idea was an obvious loser to many mechanics: "... completely reimagined the car battery ..." https://www.ycombinator.com/blog/ohm-yc-s15-is-making-a-lighter-longer-lasting-and-better-performing-car-battery https://www.ycombinator.com/blog/ohm-yc-s15-is-making-a-ligh...
  - hackernewds 4y ago
    What is _in_ their wheelhouse then?
pavlov 4y ago
Since Sequoia is still holding their Embark shares, and the company’s enterprise value is zero, here’s effectively a chance to invest at a seed round valuation together with the famed Sequoia. Funny how that would have sounded like a very exciting opportunity just 12 months ago, and now you can’t find any takers.
endymi0n 4y ago
Does anyone have good examples of pre-product, pre-revenue companies going public actually working out, especially more recently? I know access to capital is a big factor in this decision, but especially post Sarbanes-Oxley I have the feeling the forces against finding product-market fit are so incredibly high for public companies. Having seen first hand what that really means: The implicit taxes on morale of regulation, compliance, disclosure duties, transparency, auditing, bureaucracy etc. are so gigantic that I have a really hard time imagining the viability of this. I've found it's pretty hard to attract high freedom high responsibility talker-doers to a public company for those reasons. That's certainly a driving factor behind startups staying private for longer than ever and continuously rising VC round amounts, but I already found it's hard enough for a profitable company with product-market fit to go public and still keep their top talent that I don't want to imagine what that feels like pre-revenue.
- TomSwirly 4y ago
  Sarbanes-Oxley was a response to generations of deliberate malfeasance by C-level executives across all market sectors. Corporations in general continue to show record profits, year after year, despite all this kwetching about "regulation, compliance, disclosure duties, transparency, auditing, bureaucracy etc." The religion of capitalism seems to have chosen "whining" as its liturgical music, while still raking in the cash hand-over-fist, looting our society and our economy, and destroying our climate and our ecosystem. How humiliating for humanity to be destroyed by a group of whingers!
- whimsicalism 4y ago
  > Does anyone have good examples of pre-product, pre-revenue companies going public actually working out, especially more recently? Moderna
  - hgsgm 4y ago
  - thedrbrian 4y ago
    >Moderna https://unlimitedhangout.com/2021/10/investigative-reports/moderna-a-company-in-need-of-a-hail-mary/ https://unlimitedhangout.com/2021/10/investigative-reports/m... their share price is up and down like bitcoin....
thiscatis 4y ago
The original title mentioned this is a YC company but this has been changed now.

101 points by donsupreme 4y ago

>> The projected date of actual deployment isn’t too far off, either. Embark said it intends to commence commercial operations in 2024. Based on what specifically, at what cost once launched, how much will they charge, how much will the cheapest non-autonomous competitor cost, etc?

UncleEntity 4y ago
They are basically trying to replace trains with their less efficient robotrucks driving between “transfer facilities”. Anyone who needs it “just in time” loads it on a truck and the ones who don’t throw it on a train, generally speaking. In order for them to compete they would have to be somewhere in the middle price wise which, theoretically, shouldn’t be all that hard if they don’t have the cost of a driver. Minus the costs of all the trucks that are going to get disabled once people figure out they can be easily hijacked out in the middle of Texas. I’d imagine this will be a lot harder now since they won’t have VC money to subsidize their business model and have to compete in a highly regulated market where the DOT will shut them down in a heartbeat if they get up to the usual Silicon Valley tricks.

nowherebeen 4y ago

So they tried to offload shares to the public before actual deployment and failed?

deleted 4y ago
[deleted]

FlyingSnake 4y ago

This is why the whole “Unicorn” schtick looks like a scam. If these pie in the sky valuations can fluctuate so wildly, why should they be trusted?

seanmcdirmid 4y ago
High pay-out = high risk? The lottery ticket with a $5 billion pay out is still a lottery ticket.
JumpCrisscross 4y ago
> these pie in the sky valuations can fluctuate so wildly, why should they be trusted? They shouldn’t. Valuations are analogised to market cap. This is almost more idiotic than the crypto convention. Multiplying the price paid for Series F preferred stock by the number of common shares is asinine. They’re different securities. In a bill market, the mistake is subtle. In a bear market, the lie is revealed.
TulliusCicero 4y ago
> why should they be trusted? They shouldn't be, not as a general rule anyway. Though as a general principle, what happened here was just, "some rich people thought <company> would be worth a lot of money, and then they were wrong." Nothing super shocking here, obviously that will happen all the time.
- FlyingSnake 4y ago
  That’s my metric as well and I feel all this discourse around putting “unicorns” on a pedestal disingenuous.

vadym909 4y ago

Seems like SPACs have been a race between getting ‘discovered’ as worthless and unloading owner and VC equity to the public at high valuations.

ejanus 4y ago

So not only crypto-focused firms are becoming worthless.

nowherebeen 4y ago
Crypto startups are only a symptom, the problem is much deeper with startups in general. Tons of non-crypto startups don’t generate a profit. They have all been burning VC money and this was okay because they were able to offload the shares to the public. The party is now over and we are going to start seeing lots of startups fail.
- rurtrack 4y ago
  I mean, by definition, lot of startups fail

ralph84 4y ago

> the company holds no patents How can you work on something as nascent as autonomous trucks for six years and not come up with even a single unique idea?

oxryly1 4y ago
I’m not sure the correlation between patents and innovation is quite so well established.
- iancmceachern 4y ago
  Every hardware company, companies that make physical hardware, hinges on this. It's viewed as key to raising any kind of money, it's a cost of entry. Typically companies I hardware will have dozens or hundreds of patents, it's just key. Look at how many patents tesla has, vs this, and one has been successful one not. If you were raising money from serious investors for a hardware project and said you don't have any patents, you should be laughed out of the building. It's what your selling, it's a key part of the ip moat.

supernova87a 4y ago

Does anyone have (or has anyone read) any smart summary/analysis about the phase we find ourselves in with the autonomous driving industry? Is it like CVML was in a desert for some decade(s) where there were no big advances, but lots of hope and unrealized claims of some impending breakthrough, only for lots of money to be dumped into it, and companies to be led astray? Are we waiting for some major improvement in algorithms, or hardware, like GPU progress, and things will suddenly take off? Or are there fundamental difficulties that are startups (and their researchers) keep banging their heads against thinking that they're the ones to be able to solve it? Or just that they need to go through the same mistakes over and over but make little progress? It seems to have been a decade and what, $20B poured into this, but we are really not much closer to the goal? (and I'm not even sure whether we mean solving the AV problem, much less achieving a viable business model) Sure Waymo is driving in San Francisco, but that seems like a very handheld single example.

lnsru 4y ago
It’s closer to 3 decades today starting with European project: https://en.m.wikipedia.org/wiki/Eureka_Prometheus_Project https://en.m.wikipedia.org/wiki/Eureka_Prometheus_Project Looks like, that some problems can’t be solved just throwing money at them. Modern hardware is light years away from the one in Prometheus Project. Radars, lidars and cameras are superior now. Heck one can design and build dedicated ASIC for cheap nowadays. Maybe taking Nvidia Drive and tweaking it is just not enough to get there.
dvh 4y ago
Autonomous driving is in "principally works but lawsuits haven't started yet" phase.
thrashh 4y ago
The way I think about is that when we drive as humans and an obstacle appears, we have over 15 years of knowledge that we have to determine our next step. And we coalesce a lifetime of knowledge in a matter of seconds. These modern algorithms do not try to implement general AI. They do not work with 15 years of knowledge. They just recognize some patterns with no understanding of what they’re are looking at. It’s a different and easier approach but I think it has some severe limits that will never be overcome. To me it’s like a software programmer that copies Stack Overflow snippets but doesn’t really understand programming. They get only so far

lnsru 4y ago

Why I can’t see autonomous city bus companies. The speed is slow, route is rather short and predefined. April tags or UWB radio location beacons can be placed in cost efficient manner. Every city is screaming loud, that they can’t find enough drivers.

jnwatson 4y ago
Driving a bus is a tactically complicated job. The rules of the road in a major city are already a little soft. They are doubly so for buses. They park where they must, and sometimes use their size to bully their way in. City buses will be the last to go automated.
- lnsru 4y ago
  I see often dedicated bus lanes around. And sometimes dedicated traffic lights for them. It’s difficult job, but that automatically brings the need for automation. I don’t know much people who want this low pay extremely high stress job. Some blue collar workers went for subway train driver’s career. It’s much easier.
  - bombcar 4y ago
    That is (or can be) what's called bus rapid transit - basically build a train line but use busses. They could probably be significantly automated, but I don't know that the cost would be worth it, as even the best ones still interact with normal traffic at times.
  - whimsicalism 4y ago
    > Some blue collar workers went for subway train driver’s career. It’s much easier. Shouldn't that be automated first?
    - lnsru 4y ago
      I think it’s already automated when the line planing was good. However some places like Munich have terrible delays and all the strange things not allowing getting on time by subway.

ignoramous 4y ago

> The company joined the Y Combinator accelerator's 2016 batch with the initial intent of building self-driving shuttles for use on college campuses. As a change from constantly drumming up YC founders and companies who do make it (some usually off of similarly inflated valuations), it'd be interesting to see if they do talk about just how and why unicorn startups like Embark (seemingly) lose their way. That's not to say YC is particularly at fault.

landemva 4y ago
Transportation vehicles are outside their wheelhouse. This auto idea was an obvious loser to many mechanics: "... completely reimagined the car battery ..." https://www.ycombinator.com/blog/ohm-yc-s15-is-making-a-lighter-longer-lasting-and-better-performing-car-battery https://www.ycombinator.com/blog/ohm-yc-s15-is-making-a-ligh...
- hackernewds 4y ago
  What is _in_ their wheelhouse then?

pavlov 4y ago

Since Sequoia is still holding their Embark shares, and the company’s enterprise value is zero, here’s effectively a chance to invest at a seed round valuation together with the famed Sequoia. Funny how that would have sounded like a very exciting opportunity just 12 months ago, and now you can’t find any takers.

endymi0n 4y ago

Does anyone have good examples of pre-product, pre-revenue companies going public actually working out, especially more recently? I know access to capital is a big factor in this decision, but especially post Sarbanes-Oxley I have the feeling the forces against finding product-market fit are so incredibly high for public companies. Having seen first hand what that really means: The implicit taxes on morale of regulation, compliance, disclosure duties, transparency, auditing, bureaucracy etc. are so gigantic that I have a really hard time imagining the viability of this. I've found it's pretty hard to attract high freedom high responsibility talker-doers to a public company for those reasons. That's certainly a driving factor behind startups staying private for longer than ever and continuously rising VC round amounts, but I already found it's hard enough for a profitable company with product-market fit to go public and still keep their top talent that I don't want to imagine what that feels like pre-revenue.

TomSwirly 4y ago
Sarbanes-Oxley was a response to generations of deliberate malfeasance by C-level executives across all market sectors. Corporations in general continue to show record profits, year after year, despite all this kwetching about "regulation, compliance, disclosure duties, transparency, auditing, bureaucracy etc." The religion of capitalism seems to have chosen "whining" as its liturgical music, while still raking in the cash hand-over-fist, looting our society and our economy, and destroying our climate and our ecosystem. How humiliating for humanity to be destroyed by a group of whingers!
whimsicalism 4y ago
> Does anyone have good examples of pre-product, pre-revenue companies going public actually working out, especially more recently? Moderna
- hgsgm 4y ago
- thedrbrian 4y ago
  >Moderna https://unlimitedhangout.com/2021/10/investigative-reports/moderna-a-company-in-need-of-a-hail-mary/ https://unlimitedhangout.com/2021/10/investigative-reports/m... their share price is up and down like bitcoin....

thiscatis 4y ago

The original title mentioned this is a YC company but this has been changed now.