Shares in Pony AI ADR closed down $1 today after the Chinese autonomous vehicle startup raised $413 million in an initial public offering that debuted on the Nasdaq stock exchange earlier today.

In the IPO, Pony AI offered 20 million American depository shares, each representing one Class A ordinary share of the company, at $13 per share. Throughout the day and post-IPO, the Pony hit a high of $15.48 before dropping below the $13 IPO price just before 1 p.m. The shares never rose above the $13 list price again for the rest of the regular trading day.

Founded in 2016, Pony AI offers Level 4 autonomous driving technology aimed at facilitating driverless operations. The company’s system combines cameras with sensors such as radar and lidar, plus artificial intelligence software, to spot objects at distances of up to 200 meters and can be fitted onto regular cars and trucks.

Regarded as one of the world’s leading autonomous driving firms, Pony AI has an extensive ecosystem of auto industry partners which it collaborates with to fine-tune its offerings. Key collaborations include Toyota Motor Corp., with which Pony AI formed a joint venture to advance the mass production of Level 4 autonomous vehicles. Pony has also worked with SANY Heavy Truck to develop next-generation autonomous trucks and with Horizon Robotics to create smart driving solutions for original equipment manufacturers.

Pony AI has grown rapidly in its native China, where it operates fully driverless ride-hailing services in cities including Beijing and Guangzhou. While the company has faced challenges in the U.S., including the revocation of its California robotaxi testing permit in 2022, it resumed testing with safety drivers in 2023.

Coming into its IPO, Pony AI had raised $1.19 billion in venture capital funding, including a Series D round on a $8.5 billion valuation in March 2022. Investors in Pony AI included Green Pine Capital Partners, CMC Capital, Redpoint Ventures China, The Ontario Teachers’ Pension Plan, Fidelity China, 5Y Capital, ClearVue Partners, Eight Roads, Sequoia Capital China, IDG Capital and Toyota.

Notably, Pony AI floated at a valuation of nearly $5.4 billion, according to Bloomberg, down from its 2022 on-paper valuation.

Pony AI follows in the steps of other self-driving car and technology companies that have gone public. Similar companies that have gone public include TuSimple Holdings Inc., which raised over $1 billion in its 2021 IPO for autonomous trucking, and Luminar Technologies Inc., which went public in 2020 through a special-purpose acquisition company merger.

Photo: Pony AI