Exclusive: Ex-TuSimple CEO Pivots from San Diego and Raises $20M For New Self-Driving Trucking Startup
Xiaodi Hou co-founded one of the hottest unicorn tech startups, can he do it again?
Three years ago, self-driving big-rig trucking company TuSimple was flying high in 2021, the newly-minted unicorn was once San Diego’s hottest software startup — fresh off a successful IPO, valuing the company at $8.5 billion. The rise and fall of TuSimple was widely covered by news outlets over the last twelve months.
By 2021, TuSimple had 70 autonomous trucks on the road globally and was known as one of the leaders in the autonomous trucking industry. At its peak, the company had over 900 employees, with a market capitalization per employee of about $11 million.
That valuation quickly tanked after the WSJ first reported the company was facing a federal investigation by the SEC in October 2023, related to illegal ties to a Chinese entity. A year later, it saw an exodus of talent including layoffs of hundreds of employees in the span of months, and eventually announced that that company shut down its U.S. operations pivoting into AI gaming.
Xiaodi Hou, one of the co-founders at TuSimple, is now back with a new startup called Bot Auto, another driverless trucking startup and has just announced its $20 million funding round led by nine different venture firms.
Bot Auto’s investors include Brightway Future Venture, Cherubic Venture, EnvisionX Venture, First Star Venture, Linear Capital, M31 Capital, Taihill Venture and Uphonest Venture.
Mr. Hou shared his lessons from scaling TuSimple, why he decided to move to Texas from San Diego, and what’s next for his ambitious self-driving trucking company.
High-Level Overview
Founded in 2023, Bot Auto is an autonomous truck startup that aims to transform American transportation.
The company operates an AI-driven autonomous truck fleet and provides a Transportation as a Service for freight customers.
Bot Auto is already testing autonomous trucks on highways, has roughly 40 employees, and plans to add 20 additional staffers by the middle of 2025.
Based in Houston, CEO Xiaodi Hou moved from San Diego to avoid regulatory hurdles and the desire to be closer to one of the main “logistics hubs of the U.S.” which he believes is Texas.
Founding Story
Xiaodi Hou co-founded TuSimple in San Diego in 2015 after earning a Ph.D. from the California Institute of Technology, also known as Caltech.
He served as the chief technology officer of TuSimple and eventually led the company CEO as the company with 980 employees before being ousted as CEO in October 2022.
“I completely separated from TuSimple and began figuring out what I was going to do next around April 2023” said Hou. “I thought about building in robotics or large language models — but I decided to focus on autonomous trucking, again.”
“In the past seven years, nobody denies the technological success of TuSimple, and people know that I'm behind it,” said Hou. “A couple years ago, some investors thought autonomous was too early to invest, but now the time has come for a true autonomous company to emerge.”
Self-Driving Trucks Using AI
Bot Auto will operate its own autonomous truck fleet and offer Transportation-as-a-Service to freight customers. “We will offer Level 4 autonomous vehicles,” said Hou.
Autonomous vehicles are classified in levels 1 to 5. Level 4 does not require human interaction, but the driver can still manually override systems.
To start, it is testing a single truck with a version of end-to-end AI software from its base in Houston to San Antonio, about 200 miles.
“I want to make this clear. We’re not going to promise you that this truck is going to be running without human intervention by next year.
However, I can say there will be a lot of societal benefits that people can actually expect from our technology.
We're still a technology company — super heavy, nerdy tech company — but we never get proud of ourselves by simply building cool tech. We are proud of ourselves by applying our world's best technology in reducing the operating cost.”
Moving from San Diego to Texas
The decision to incorporate Bot Auto in Texas over San Diego was due to several reasons, said Hou, but emphasized that the region is not a key logistics hub.
After evaluating up to 10 different cities, it was clear that Texas is the leader in autonomous trucking and is also home to some of the most central freight routes in the U.S., including the I-45 corridor.
The company’s headcount is currently 45 employees, and its plans to grow its headcount to 65 staffers by middle of next year
“We came to Texas because we feel that we need the technology team to be very close to the day-to-day operation of the trucks,” said Hou. “There’s a ton of facilities here, plus it is a growing big city which is also good for a lot of families to relocate to here — it’s the perfect place.”