For a handful of investors, the future of mostly automated cars looks increasingly attractive.
Mobileye, a provider of driver-assistance technology systems, said on Sunday that it has raised $400 million in financing, valuing the company at about $1.5 billion.
The money, raised in an oversubscribed financing round, is coming from five new investors, according to a person briefed on the matter: the money management firms BlackRock, Fidelity Management and Wellington Management; a Chinese investment firm, Sailing Capital; and Enterprise Rent-A-Car, the privately held rental car company.
The investment, the biggest yet in Mobileye’s 14-year history, will help the technology company strengthen and expand its offerings and its global reach. It also comes ahead of what Ziv Aviram, a co-founder and the company’s chief executive, said is an expected initial public offering in perhaps a year and a half’s time.
Some of the money will be used to cash out existing investors, Mr. Aviram added.
Headquartered in the Netherlands, the company currently focuses on helping cars avoid collisions and pedestrians, as well as drifting out of lanes. The longer-term goal, Mr. Aviram said in a telephone interview, is more ambitious: a semi-autonomous vehicle that can handle many, but not all, driving functions without driver input.
The goal is not dissimilar in some ways to Google‘s already famous driverless cars, though the technology giant’s systems allow for completely hands-off driving. But Mobileye is aiming to get most of the functionality in cars for much less, with fewer cameras and computer equipment that cost hundreds of dollars, rather than the tens of thousand of dollars that Google’s array of sensors is estimated to cost at the moment.
“It’s a camera and a chip, with no exotic technology,†Mr. Aviram said of his company’s current technology. “It’s the most cost-efficient system that’s out there.â€
He added that he didn’t necessarily mind comparisons to Google’s systems, which have raised awareness of automated driving worldwide. But Mobileye’s goal was getting into more cars at a lower price.
The company began working with three major car makers â€" General Motors, BMW and Volvo â€" in 2007 and has since added a number of others. Mr. Aviram said that by the end of this year, over 3 million cars will have used its technology.
The biggest goal is yet to come: Mobileye is currently working on producing a vehicle that can run largely on autopilot around 2016, with four partners on board. The company is anticipating the rollout of new rules in Europe that will allow for more fully automated driving, with other countries like the United States and China to follow.
Mr. Aviram said that he believes full-on driverless systems won’t be practical for another 15 to 20 years. But systems that help out tired drivers, or let users check e-mail on the road, have potential. One possible use that could roll out in the near term, he said, is Mobileye taking over driving in stop-and-go traffic.
“With a traffic jam, you can completely relax,†he said.
Beyond car manufacturers, insurance companies have also shown interest in Mobileye’s offerings. One insurer in Israel, where the company’s research and development is based, has pushed for the use of the crash-avoidance systems in the cars for teen drivers.
Mobileye was advised on its financing round by Goldman Sachs, itself an existing investor in the company; Morgan Stanley; and the law firm Morrison & Foerster. The deal is expected to close next month.
