Elon Musk's tunneling startup, The Boring Company, is in talks to raise a 20 billion, according to The Wall Street Journal. The deal has not closed and the terms could change, but the valuation would represent a significant increase from the company's previous valuation.
The Boring Company has already built a network of tunnels under Las Vegas, through which Teslas shuttle customers to different stations. However, the project has faced challenges. Tunnel workers have reported safety concerns, and Nevada regulators said last year that the company had violated certain regulations.
The startup has announced plans to build tunnel networks in Dubai and has also pitched projects in Baltimore, Chicago, and Los Angeles, according to the WSJ. The company spun out of SpaceX in 2018. SpaceX recently raised funding at a valuation, but The Boring Company has not disclosed a funding round since then.
The proposed $20 billion valuation would more than double the company's previous valuation from 2022, reflecting continued investor interest in Musk's infrastructure ventures despite operational challenges. The Boring Company's core technology involves tunnel boring machines that are designed to be faster and cheaper than traditional methods, though the company has faced scrutiny over safety and regulatory compliance.
The Las Vegas tunnel network, known as the Vegas Loop, currently operates with a fleet of Teslas transporting passengers between stations. The company has proposed expanding the network to cover more of the Las Vegas Strip and connect to the city's convention center. International expansion plans, particularly in Dubai, represent a significant growth opportunity if the company can secure regulatory approvals and project financing.
The funding talks come at a time when infrastructure startups are attracting increased investor attention, particularly those with ties to high-profile entrepreneurs. However, The Boring Company's path to profitability remains uncertain given the high capital costs of tunnel construction and the regulatory hurdles involved in urban tunneling projects.