Toyota Commits $1.5 Billion to AI, Automation, and Climate Startups Worldwide

Toyota is making another bold move to future-proof its business. The automaker has announced a $1.5 billion commitment to startups tackling some of the most critical technologies of this decade: artificial intelligence, climate tech, automation, and advanced mobility.

The investment is split across two distinct funds, each with its own role in Toyota’s long-term strategy.

Building the Pipeline from Idea to Scale

The first arm, Toyota Invention Partners Co., will focus on very early-stage ideas. Backed with $670 million, it is designed to nurture “zero-to-one” companies, those at the concept and prototype stage, particularly in Japan. Unlike a typical venture capital fund that needs to return capital within ten years, this arm is structured to operate over decades. Toyota wants to give researchers and entrepreneurs time to solve big, capital-intensive problems without the pressure of short-term exits.

On the other end of the spectrum, Toyota has launched Woven Capital Fund II, a global $800 million growth-stage fund. This arm targets Series B and later startups that are ready to scale, especially those whose solutions align with Toyota’s core areas: AI, automation, sustainable energy, and mobility technologies.

This two-tiered approach creates a funnel where ideas can move from concept to commercialization with Toyota’s support, ensuring the company has early access to disruptive technologies while also being able to back proven companies at scale.

Early Signs of Strategy in Action

One of the first companies to benefit is Machina Labs, a U.S.-based startup that blends robotics with AI to reinvent manufacturing. Woven Capital invested in Machina, and Toyota will now test its technology for producing automotive body panels. This shows how Toyota plans to go beyond writing checks. It will act as a customer and partner, creating real-world testbeds for the startups it funds.

The model is consistent with Toyota’s Woven City, a futuristic smart city under construction at the base of Mount Fuji. Woven City serves as a live experimentation zone where mobility, automation, and climate solutions can be tested at scale. Together, the funds and Woven City give Toyota a controlled ecosystem to accelerate innovation while staying close to its core business.

Industry at a Turning Point

The auto industry is undergoing a transformation. Electrification, automation, and sustainability are changing how vehicles are designed, powered, and used. Toyota has often been criticized for being cautious on electric vehicles, but this $1.5 billion commitment shows a clear urgency to adapt.

Backing startups across AI, automation, and climate solutions allows Toyota to stay close to the technologies reshaping mobility. It creates a steady pipeline of potential partners and suppliers while blending venture capital with in-house research. The company is not only protecting itself from disruption but also positioning to influence how the next generation of mobility evolves.

The risks remain. Climate and automation startups require significant capital, timelines are long, and many attempts will fail. Still, Toyota is signaling that it is ready to play the long game. By structuring Invention Partners for decades-long horizons, it is embracing a level of patience that most investors can’t afford.

A Global Opportunity

For startups, the door is now open. Toyota’s Woven Capital Fund II is explicitly global, meaning entrepreneurs in markets like Africa, Asia, and Latin America, regions often overlooked by traditional venture capital, could find a new partner in Toyota. For those building in climate tech, automation, and AI, the timing could not be better.

Toyota isn’t just building cars anymore. It is trying to architect the technologies, cities, and ecosystems where those cars will exist. That requires far more than an auto plant. It requires a network of innovators tackling the toughest problems in energy, intelligence, and infrastructure.

With $1.5 billion on the table, Toyota is betting big that the future of mobility will be written not only in-house, but also in partnership with the next generation of startups.