Google has spent a lot of money on its self-driving car project, now spun off into a new entity called Waymo. Much of that money has gone to engineers and other staff, according to a new report from Bloomberg. In order to keep self-driving staffers happy — and, presumably, from leaving the company for other firms doing similar work — Google backed the proverbial Brinks truck up to the self-driving department and unloaded.
Bloomberg says that early staffers “had an unusual compensation system” that multiplied staffers' salaries and bonuses based on the performance of the self-driving project. The payments accumulated as milestones were reached, even though Waymo remains years away from generating revenue. One staffer eventually “had a multiplier of 16 applied to bonuses and equity amassed over four years.” The huge amounts of compensation worked — for a while. But eventually, it gave many staffers such financial security that they were willing to leave the cuddly confines of Google.
Two staffers that Bloomberg spoke to called it “F-you money,” and the accumulated cash allowed them to depart Google for other firms, including Chris Urmson who co-founded a startup with ex-Tesla employee Sterling Anderson, and others who founded a self-driving truck company called Otto which was purchased by Uber last year, and another who founded Argo AI which received a $1 billion investment from Ford last week.
In 2015, Google’s parent company Alphabet lost a mind-boggling $3.5 billion on “other bets” like the self-driving project, and lost another billion dollars in the last quarter of 2016 alone. The company has a lot of projects in the “other bets” category, so not all can be blamed on self-driving cars, but the decision to spin off the project into Waymo could make the financials look a bit better.
To be sure, the autonomous car space is ultra-competitive right now, with top dollar being thrown at experienced engineers by tech and car companies alike — but perhaps Google was a little ahead of the curve. Sure, its self-driving technology is among the best in the industry, but it’s not clear if its head start will translate into dollars down the road.