Xiaodi Hou, founder and CEO of Bot Auto.
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Xiaodi Hou, co-founder and CTO of failed startup TuSimple, is making a new attempt to master robotic trucking. His new company just raised $20 million from venture investors and aims to start commercial operations next year.
Houston-based Bot Auto plans to operate self-driving semiconductors along Texas highway routes, transporting cargo between warehouses and distribution facilities in Houston and San Antonio. Unlike San Diego-based TuSimple, which delisted its stock earlier this year in the wake of a massive explosion, the new company will directly own its fleet of trucks rather than offer autonomous cargo transportation technology as a service. Hou said the company plans to operate as Initial loads will be transported by trucks equipped with laser lidar, radar, and cameras, along with human backup drivers. Hou declined to say when fully automated deliveries would begin.
“It’s time for companies to rethink how best to deliver (autonomous) technology,” Hou told Forbes. “TuSimple was born in the first wave of deep learning, and now we have the second wave of deep learning and new technologies to adopt. We also have a new organizational structure. We are operating more efficiently, using newer technology, but still aiming for the same holy grail of self-driving.”
Hou said this goal also means being able to drive trucks in fully autonomous mode at a cost comparable to that of a human driver (about $2.50 per mile). The appeal of robotic trucking is that it addresses the persistent shortage of human drivers.
But for Hou, a Caltech-trained computer scientist, it was a gamble. Until early 2022, TuSimple appeared to be on track to commercialize robotic trucking, ahead of larger rivals like Waymo and Aurora. The company has finalized transportation contracts with major customers and announced development plans with several major truck manufacturers, aiming to offer driverless freight transportation by the end of 2023. But immediately after its $1.4 billion IPO in early 2021, things quickly deteriorated. An accident in 2022 in which a TuSimple truck crashed into a highway divider shook the company’s image. An investigation into the incident ended last year when the National Highway Traffic Safety Administration chose not to launch a formal investigation.
But sharp disagreements over business strategy between Mr. Hou, the company’s board member, and (former and current) CEO Cheng Lu exacerbated the problem. TuSimple’s relationship with Hydron, another China-based trucking company founded by co-founder Mo Chen, has also been disrupted by the U.S. Foreign Investment Commission, citing concerns that it was sharing technology with Chinese companies. (CFIUS review) triggered a federal investigation. Hou was removed as CEO by TuSimple’s board in late 2022, in part related to his alleged relationship with Hydron, which Hou has always denied. The disruption forced operations to halt last year. Last month, TuSimple settled a $189 million lawsuit brought by shareholders who accused it of defrauding shareholders by exaggerating its safety record and concealing its founder’s and executives’ ties to Hydron. Mr. Hou, Mr. Chen and Mr. Lu all denied wrongdoing.
BotAuto plans to start operating trucks on commercial routes in 2025.
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In addition to the technical challenges Bot Auto hopes to accomplish, the new company is likely to face at least one additional hurdle.
Most of the 40 employees working at Hou’s startup are former TuSimple engineers. TuSimple’s Cheng Lu says the software he is developing is entirely new and not based on work done at his previous company, but he says he is likely to file a lawsuit against Bot Auto. said.
“Of course we will have to sue him because he is in direct competition with us,” Lu told Forbes. “It’s not fair to TuSimple’s shareholders that someone has stolen our company’s knowledge, the trade secrets we spent billions of dollars developing.”
Mr. Hou, who did not sign a separation agreement or receive any compensation in connection with his departure from TuSimple, said he was not concerned about potential litigation by the remnants of his former company.
“The beauty of America is that we are a free country. Anyone can sue about anything,” he said. “We’ve built everything ourselves from new technology. I don’t see any possibility of them filing a lawsuit.”
Now, TuSimple’s Chen and Lu are pivoting their company to use their AI achievements to create video games and animation in China. Mr. Hou has had no involvement with the company since his retirement and is skeptical that he will be successful with his new company.
“I think it’s funny,” Hou said. “It’s like opening a sports website one day and finding out that Leonel Messi has announced that he’s going to retire from football and play basketball. I mean, it’s complete nonsense.”
Investors in Bot Auto’s round include Brightway Future Venture, Cherubic Venture, EnvisionX Venture, First Star Venture, Linear Capital, M31 Capital, Taihill Venture, Uphonest Venture, and Welight Capital.
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