Comment by ra7

Yes, it provides external validation for the valuation. Otherwise, Alphabet can simply "self value" Waymo at a funny amount like $1T.

There's also a strategic partnership angle in these rounds. For example, Magna and Autonation were early investors in Waymo. Magna operates Waymo's factory in Arizona to upfit their vehicles with sensors, Autonation (the huge dealership/service network) is the maintenance partner.

In general, the Alphabet playbook is that projects "graduate" out of Google X, and are expected to operate as a standalone company, including being responsible for raising funds.