:format(webp)/cdn.vox-cdn.com/uploads/chorus_image/image/63708867/shutterstock_212257345.0.1489269720.0.jpg)
Every carmaker is racing to building driverless tech — and General Motors just opened its wallet wide to get there. The company spent over $1 billion for its acquisition of the startup Cruise Automation announced this morning, according to multiple sources.
Cruise, which began creating autopilot features but shifted to a focus on retrofitting cars with fully autonomous “kits,” had raised just $18.8 million from Spark Capital, Maven Ventures, Y Combinator and a gamut of small investors. One source said the startup had around $10 million in the bank at the time of the acquisition.
GM hopes to scale up the startup’s tech, spreading it across its fleet of mass market vehicles in order to compete with rivals like Ford and Tesla, which are investing heavily in self-driving cars. Like other carmakers, it has to devise a strategy for the entrance of Google and Apple into the car world.
The sum GM is paying makes Cruise the largest exit for a startup from Y Combinator, the well-known Silicon Valley incubator. The previous honor went to Twitch, the video game livestreaming company that Cruise founder Kyle Vogt also co-founded. Twitch sold to Amazon for $970 million. These numbers aren’t perfectly comparable, though: They’re very different businesses, and it’s likely that the GM deal involves some mix of cash, stock and payouts.
Neither GM nor Y Combinator immediately returned request for comment. GM reported net sales of $152.4 billion and net income of $9.7 billion for 2015.
Nabeel Hyatt, a Spark Capital investor and Cruise board member, wrote in a post this morning that the startup’s progress has been “utterly phenomenal.” He added: “It was no surprise to me that once GM got a chance to see what was going on, they knew that the team at Cruise was the one to support no matter what that meant.”
Fortune first reported the acquisition price this morning.
This article originally appeared on Recode.net.
