Autonomous driving startup Pony.ai, backed by Nio Inc (NYSE: NIO) and Toyota Motor Corp (NYSE: TM), said on Monday that it fetched a valuation of $8.5 billion following the first close of a Series D financing round.

What Happened: Pony.ai said the latest funding round lifted its valuation by more than 65% over the previous round. 

The company did not reveal how much was raised in the first close but said it would use the proceeds for recruitment, research and development and for testing its robotaxi and robotrucking products, among other things.

Pony.ai said it would reveal more details at the closing of the full financing round.

Founded in December 2016, the startup had a valuation of $5.3 billion as of 2020. Nio's venture capital arm revealed an investment in Pony.ai in late 2019, while Toyota invested $400 million in the startup the following year as part of a partnership extension.

See Also: Toyota Backed Driverless Startup Pony.ai Aims US Listing: Reuters

Why It Matters: Pony.ai, which competes with Alphabet Inc's (NASDAQ: GOOG) (NASDAQ: GOOGL) Waymo and General Motors Co's (NYSE: GM) Cruise, had said last year it was exploring U.S. listing plans but did not provide a timeline.

In May last year, Pony.ai secured permission from California regulators to test six autonomous vehicles without human safety drivers on specified streets in Fremont, Milpitas and Irvine.

Photo Courtesy: Pony.ai