In late 2016, Elon Musk, frustrated by the continuing traffic jams in Los Angeles, launched a pet project called "The Boring Company" and outdated transport infrastructure system. To tackle this problem at its root, the Boring Company aims to build a network of underground tunnels that allow cars to travel at full speed with an electric sled.
The young company was a subsidiary of SpaceX Beginnings and had a hard time winning venture capital. Not long ago, attempts were made to raise money by selling baseball caps and flame guns worth $ 500.
But that's all history now. This week, the Boring Company made its first investment outside the company through a $ 120 million stock sale. Bloomberg first reported on late Thursday prosecuted private companies in the US
The round of financing was led by venture capital firms 8VC, Vy Capital, Craft Ventures, Valor Capital and DFJ. Musk's longtime VC friend, Steve Jurvetson, an early investor in Tesla and SpaceX, also participated in the round.
"We are pleased to be an investor in Boring. Boring is a great example of the disruptive gaming book we are looking for, "said Jurvetson to Bloomberg on behalf of its VC firm Future Ventures. The deal raised the valuation of the Boring Company to $ 920 million, a company spokesman confirmed. Achieving such a status as a Fast Unicorn in less than three years is extremely rare for the startup world standard.
"The four largest tunnel companies in the US were founded in the 19th century. Like the automotive and aerospace industries, they have not seen any disruptive new entrants throughout their management lives, "Jurvetson said of the company's outlook.
Two months ago, the Boring Company received its first commercial order, a $ 49 million tunnel project with the city of Las Vegas. The project involves the construction of a kilometer-long subway loop around the Las Vegas Convention Center to bring visitors into the area.
The company has built a test tunnel near its headquarters in Hawthorne, California. However, Musk's original goal to solve the traffic problem in Los Angeles has not yet materialized. In December 2018, the Boring Company lost a contract in the City of Angels after local activist groups resisted.