Driverless Car Start-Up Roadstar Goes Bankrupt
One of the most assertive Chinese Driverless Companies, Roadstar, is closing the shop due to the hopeless product development progress together with an internal dispute.
According to Quantum Bits (量子位), Roadstar.ai moving towards the dusty pages of the history together with its USD 138 million total funding. Reportedly, the bankruptcy came along with the investors’ pressure resulting from the recurring internal scandals within the administrative team of Roadstar and the company’s failure of coming up with a disruptive driverless car software innovation. Following the situation, Roadstar has been removed from EO 500.
Roadstar’s executive team have been fluctuating since ZHOU Guang (周光) was fired for several reasons including corruption, on 21 January 2019. (See more in this article)
Founded in May 2017, Roadstar.ai had been working on L2, 3 and 4 autonomous driving technologies. Backed by Shenzhen Capital and Yunqi Partners; Roadstar raised USD 128 million in May 2018 during its latest round.
Dominated by Baidu, Roadstar was one of the companies in China that try to develop software solutions for driverless car technologies. Roadstar was directly competing with two other Chinese driverless car software producers; Pony.ai and Momenta.ai. (See more in this article) Unfortunately, it became the first one who backfires.
Roadstar was founded by the engineers who had previously worked at Google, Tesla, Baidu and NVIDIA; however, their compatibility as a team was not as impressive as their backgrounds. Besides the corruption scandal on 21 January 2019, the last straw which broke the camel's back, there had long been several other rumours about the internal discrepancies of the administrative team. A series of undesirable cases have led to the company's complete death. According to QBit's investigation; there is already nobody left in the company's office in Shenzhen and even the secretary has gone with the wind.
Apart from the administrative problems, Roadstar has failed the class in product development as well. Since its latest funding in May 2018, the company could not manage to come up with a tangible product that might have a disruptive effect within the industry. From sensor technologies to the car-hailing app; Roadstar has claimed that it was preparing to launch "tangible and commercial" products within 2019. However, as of now, no one has seen any commercial and useful product produced by the company.
Roadstar's bankruptcy reminded the importance of the team and product characteristics in venture investment decision-making process, yet again.