CNBC Disruptor 50

10. Pony.ai

Founders: James Peng (CEO), Tiancheng Lou
Launched: 2016
Headquarters: Fremont, California
Funding:
$1.1 billion
Valuation: $8.5 billion
Key technologies:
Artificial intelligence, autonomous vehicles, cloud computing, deep neural networks/deep learning, machine learning, robotics
Industry:
Transportation
Previous appearances on Disruptor 50 List: 0

Persephone Kavallines

By 2030, driverless cars on the roads might not be such a shocking sight, with projections that the global market will triple to 62.4 million self-driving vehicles. Toyota-backed Pony.ai, geared up in both China and the U.S., is a contender in this race but has hit a few speed bumps along the way.

In major milestones in China, Pony.ai recently began operating a fleet of 100 robo-taxis with paid fares in the Nansha district of Guangzhou and won approval late last year to start trialing a commercial robo-taxi service in a southeast zone of Beijing, following tests of a free service. A Shanghai and Shenzhen expansion is planned for next year. Robo-trucks are in its sightlines, too, with permits granted in Beijing and Guangzhou, and pioneering tests underway on a highway. The company also debuted early in 2022 its sixth-generation autonomous driving system, expecting to equip a seven-seat Toyota Sienna model and begin road testing in China this year with robotaxis following next year.  

Pony.ai was co-founded in Fremont, California in 2016 by CEO James Peng, a chief architect of Baidu's autonomous driving unit, along with former engineering colleague Tiancheng Lou as CTO. With $400 million in funding in 2020 from Toyota, Pony.ai is aiming high as both the U.S. and China aim to be leaders in autonomous mobility and smart city technology, with China leading adoption trends. The well-funded start-up has raised a total $1.1 billion, including a Series D financing at an undisclosed amount in March 2022, which valued the company at $8.5 billion, and Series C of $367 million two years earlier, primarily from China venture investors, as well as the Ontario Teachers' Pension Fund. 

The self-driving innovator competes with other start-ups that have joined with established auto makers to bring driverless vehicles to market sooner, Argo.AI with Ford and Cruise with GM. Big tech investors that have entered the market over the past few years also are rivals. Alphabet division Waymo began operating vehicles with no front-seat drivers in Phoenix suburbs in 2019 while Amazon subsidiary Zoox is testing its electric robo-taxis in the San Francisco area, Seattle and Las Vegas. Chinese search giant Baidu got a permit last year to begin testing driverless vehicles in the U.S., and has launched robotaxis in several Chinese cities.

In California, Pony.ai faced a setback when its driverless tests were suspended in three cities late last year after one of its vehicles hit a lane divider and a street sign in Fremont in October 2021. Pony.ai issued a recall in March for some of its autonomous driving software. The suspension didn't impact its permit for testing with a safety driver.  

In other developments, Pony.ai reportedly was preparing to go public, and last June hired Lawrence Steyn from JP Morgan as CFO. But Pony.ai soon put its plan to go public via a SPAC on hold as a crackdown on Chinese companies listing in the U.S. heightened.

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