Startup specializing on remote driving Phantom Auto is ceasing operations

Phantom Auto, a remote driving company that started operating seven years ago during the excitement surrounding autonomous car technology, is closing down due to its inability to obtain additional financing.

The business, having accumulated $95 million, created a teleoperation platform enabling a remote driver, perhaps situated hundreds of miles away, to control a vehicle when necessary. The startup garnered support from several investors, including angel investors, early-stage VCs including Bessemer Venture Partners and Maniv Mobility, private equity firm InfraBridge, and strategic investors such as ArcBest and ConGlobal. The company raised $25 million in 2023.

An anonymous source claimed that the company was about to receive more funding when it abruptly fell through. The company had around 120 employees at its peak. Phantom Auto, which downsized its workforce last year, now has a little over 100 employees. It was located in South San Francisco.

Phantom Auto’s closure is the most recent among several businesses that emerged as the autonomous vehicle technology sector attracted interest and funding from investors. The excitement that resulted in billion-dollar acquisitions and valuations in the business diminished as the optimistic schedules for implementing robotaxis and self-driving cars were delayed. Consolidation, shutdowns, and pivots ensued. The challenging fundraising conditions over the last 18 months led to another round of closures.

Phantom Auto’s creator and CEO, Shai Magzimof, announced on LinkedIn that the firm is shutting down.

After seven years of endeavoring to transform the future of physical work at Phantom Auto, we have decided to cease operations. Multiple reasons, including market circumstances and inadequate investment, are contributing to this issue,” he stated. I am grateful to our staff, investors, customers, partners, and those who have accompanied us on this trip. These times are difficult, but my main focus is on our team. We currently have outstanding skills and are looking for career possibilities. I am dedicated to providing references for our personnel. Personally, I will be taking a break to relax and contemplate my future actions.

According to sources, the corporation made progress in deploying its services to customers. Nevertheless, it still depended on external money to sustain operations and ultimately expand.

Phantom Auto was established in 2017 with a primary emphasis on implementing its teleoperations technology in autonomous vehicles operating on public roads, including robotaxis and self-driving trucks. The company’s leadership team quickly understood that, despite its technology, widespread commercial implementation of autonomous cars on public roads was several years in the future.

Phantom Auto changed its focus in 2019 to market its remote driving technology to logistics companies, particularly forklifts and yard vehicles without autonomy, as well as autonomous sidewalk delivery robots. All these vehicles operate at modest speeds and, save for delivery bots, are in restricted locations. The firm has client agreements with Maersk, CJ Logistics, ArcBest, and Serve Robotics, an autonomous sidewalk bot startup.