The robots are here to save the day
The notion of robots improving the lives of humans has been a science fiction fantasy for many decades. In sectors such as automotive manufacturing and warehouse logistics (see chart below), robotics driven automation is already an established process. Having met dozens of robotics companies, three of which I’ve had the privilege of investing in, it is clear to me that the proliferation of robotics in all sectors has certainly begun. Based on factors ranging from aging populations and geopolitical pressures, to rapid technology advances and business process innovation, I believe that Robotics-as-a-Service (RaaS) can rise above the relatively niche investment theme of ‘deep tech’ to eventually become an investment movement as broadly accepted as Software-as-a-Service (SaaS).
Why do we need Robots?
“You won’t believe how things are done today!” is a common part of a passionate entrepreneur’s pitch. Massive SaaS businesses have been built replacing tasks done via Microsoft Excel, or even worse, via pen and paper. However, many RaaS applications are replacing human tasks that are dangerous and/or physically taxing — jobs for which it is increasingly difficult to find people to do the work. After hearing the pitch of each and every one of the robotics startups we’ve met, I have come away from the meeting thinking, “decades from now will we look back and think incredulously, ‘humans used to do that manually??’” A few examples can be seen below.
Industrial inspections: Today, to ensure industrial tanks holding chemicals, oil, etc. meet specifications, people enter these tanks, hazmat suits and gas masks and all, and manually perform inspections. Gecko Robotics has made great inroads to automating this task through the use of robots that can scale the walls of these industrial tanks and perform the inspections with far greater thoroughness and accuracy than humans.
Agricultural data collection: Large seed companies like Bayer and Corteva operate millions of acres of test plots to test different seed variants. Today, people manually walk the fields (typically in the middle of nowhere) to collect data on the crops as they grow. Earthsense has developed an autonomous mobile robot that can traverse the fields and collect data more frequently and more accurately than humans.
Drywall finishing: Drywall finishing is an important step in the construction process that requires multiple steps and generates a lot of dust, creating a hazardous environment for construction workers. Canvas Robotics has developed an autonomous robot that handles the various steps of the drywall process, and due to the increased consistency, decreases the finishing time from 5 to 2 days while removing humans from the messy process.
Agriculture pick & pack: Transient migrant labor is critical in the harvest of agriculture in developed markets, from Napa Valley grapes to Queensland avocados. With increasing restrictions on immigration, finding labor for tasks such as post-harvest pick & pack is a major issue for large farms. Lyro Robotics is deploying robots that can pick produce ranging from watermelons to strawberries and pack them into the boxes that get shipped to supermarkets.
How cool is that?? And these are real businesses with real recurring revenue.
In subsequent posts, I’ll dive into topics such as ‘why now’, autonomy vs. augmentation, and personal frameworks for investing in the world of Robotics-as-a-Service. This is an emerging sector and my perspectives are malleable and are iteratively formed by brilliant entrepreneurs and investors. I welcome thoughts & feedback @ sc@d20cap.com!
