Announcing Toyota’s First Venture Capital Company

“It is not the critic who counts; not the man who points out how the strong man stumbles ... The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood.” ― Theodore Roosevelt

“Courage is the willingness to play even when you know the odds are against you.” ― Thomas Szasz

We are honored to announce Toyota’s first formal venture capital effort. Toyota AI Ventures, a subsidiary of Toyota Research Institute (TRI), will deploy $100 million to focus on early stage investments in artificial intelligence, autonomous mobility, robotics, data, and cloud. That’s right, we are casting a wide net that does not limit our investments to the automotive industry.

But more important than stage and sector is our worldwide search for talented, tenacious entrepreneurs of high integrity who are bent on denting the universe — the courageous pioneers who will define the future. Many will fail, but some will succeed to develop the technologies, build the products, define how we buy and use them, and shape our world with them. If you’re one of these entrepreneurs, we want to be in business with you.

What do entrepreneurs get?

These days, capital is readily available for the best entrepreneurs. So, why take money from us?

  1. Founder Friendly · Our investment team includes entrepreneurs who understand the difficult journey you’ve embarked upon. We understand that for true alignment, it is critical that we are your shareholders first. Thus, we structure deals that won’t negatively impact your ability to work with other investors or raise follow-on funding. It’s a simple model, really. Your success is our success.
  2. Technology/Product Expertise · One of the biggest challenges startups face is product/market fit — that is, judging the product being built for the market being targeted. With Toyota’s deep expertise in research, design, and manufacturing, we can help validate product and market assumptions, sooner rather than later.
  3. Worldwide Access · With over 350,000 employees and a global network of Toyota affiliates and partners, we have the access to help get your product to market. Our corporate liaison team can facilitate introductions and explore opportunities with you.

What does Toyota get?

What’s surprising about our 91 year-old parent company, and what I discovered first-hand in my inaugural year at TRI, is the strong entrepreneurial spirit at the highest ranks of the company. Toyota Motor Corporation’s (TMC) history started in 1926 as an industrial loom company and officially pivoted to cars in 1937. TMC is now the world’s largest automobile manufacturer and a top-ten consumer brand — quite a successful pivot.

The world changes, sometimes fitfully, and we are now in the throes of such a fitful, disruptive period of innovation. Advances in artificial intelligence are disrupting markets, from composing to calendaring to call centers to, yes, cars. As Marc Andreessen famously said, “Software is eating the world.” Now, cars are on the menu. Robots, whether wheeled on the road or footed in the home, are undeniably in our future.

Expectedly, capital is rushing in to fuel the disruption. According to CB Insights, the last five years have seen a nearly 10x increase in capital invested into AI startups. But things are just getting started. As Yann LeCun, NYU professor and director of AI research at Facebook commented: “Despite these astonishing advances, we are a long way from machines that are as intelligent as humans — or even rats. So far, we’ve seen only 5% of what AI can do.”

What’s clear is that the automotive industry, and Toyota in particular, must connect to this ecosystem of startup innovation to compete in this disruptive era. Toyota AI Ventures is part of our efforts to connect to this ecosystem. We realize we don’t know everything. But we do know that humility is a prerequisite for success (more on that in an upcoming post). We also know we have a deep commitment to clear thinking, plain speaking, integrity, and simply being a great partner to our entrepreneurs. We’re excited to work with and learn from you, the entrepreneur, who has the courage to forge the future.

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