Robco links up with $14M led by Sequoia to bring modular robotics to industrial SMBs • TechCrunch
After years of outsourcing and moving manufacturing to countries with cheaper labor and larger manufacturing ecosystems, the United States and Europe are on a mission to bring some of those industrial jobs back to life. back to his shores. Today, a startup that believes it can help with that change is announcing some funding. Robco, a Munich-based startup that has built a platform to design low-cost modular robots for small and medium-sized industrial enterprises, has raised €13 million (about 13 million euros). 8 million US dollars). This round – a Series A – was led by Sequoia, with Kindred Capital, Promus Ventures and Torsten Reil, Christian Reber and Daniel Dines all investing.
Roman Hölzl, CEO of Robco, who co-founded the company with Paul Maroldt and Constantin Dresel, said the plan would be to invest the money in both expanding the capabilities of existing modules and continuing to add add more customers to its module-based modules. ‘robot as a service’ model.
Robco’s current service is based on three components focusing on turning, laser engraving and palletizing, with a business model based on customers ordering what they need and then having it delivered as a service to them. — the robots themselves are not purchased and stay on Robco’s balance sheet with the idea that they can be refurbished and reused for other customers as needed. The plan is to include more modules in milling and quality control, as well as consider further geographical expansion, such as into the US market.
Even as hundreds of millions of dollars have been poured into many robotics and industrial automation companies in recent years, Robco believes they have found a foothold in the market by focusing on tasks. complexity and build cost-effective solutions to problems. demand of smaller manufacturers. In short, SMBs may sometimes need to scale up productivity but — due to economics of demand, or labor shortages, or both — cannot hire people to take on those jobs for long. long. This is an area that the larger manufacturers of machinery for larger industrial customers have not tackled, he said.
“When we think about the market, we think there are two types that have dominated,” Höltzl said in an interview. “The first is component manufacturers, and the other is a fragmented market of system integrators that build expensive and craftsman-like robots, where you pay $250,000 per solution. No company has ever crossed the chasm to [provide] cool, exciting technology that can be deployed in days or months. We do not sell robots or software. We are essentially providing a service that automates and solves a specific problem.”
Höltzl describes the traditional approach to hiring machine operators as the “classic status quo” — something he witnessed first-hand in his parents’ small factory that inspired his success. start a company in 2020 — not as you might think, Covid-19 and the pressure it puts on direct work, though that certainly gave it a strong incentive to create generate interest and eventually sell your idea to the market. One reason is that many factors have to lay off rather than just lay off their employees, and then when it’s time to get back online, they are unable to complete their tasks and some of their expensive production machines. was vacated, and that was previously considering the weekends and evenings when employees there are not working. He cites statistics that say there are about 2 million vacancies in Europe, with labor costs rising by an average of 6.6% per year.
Comparing the costs to using Robco robots is huge: the company today, he says, typically charges $1,000/month, with costs that vary based on the length of the engagement (costs will drop if the contract is in place). longer), for a total cost of up to $4,000/month depending on the complexity of what the customer needs. A typical deployment starts with 10 modular machines, he said.
This is happening massively, he notes, with strong triple-digit revenue growth, “interesting unit economics” and, to date, four patents on its hardware and engineering. from a founding team that comes from a major research university and is therefore based on AI and technical expertise – all the details that will appeal to investors like Sequoia only relatively recently actually doubles down in Europe with a shiny new office in London, but like everyone else in the VC world is facing enormous pressure around current portfolio companies and how They weathered the great storms that hit the technology sector.
All of which suggests more conservative and perhaps less generous investing, which could mean more adherence to arguments around profit making and less exploration of interesting ideas. more taste.
“Robco’s approach is unique [in the SMB manufacturing space] because what they’re doing is a bit like Lego. Luciana Lixandru, head of investment for Sequoia, says they are taking a modular approach. “Whatever your use case is, you tell them what kind of machine you need and they create the right format. The lead time is short, one or two days. They then created a software platform where you put modules together to create a digital copy. Then it’s easy to configure and control — something that previously required more technical expertise or outside consultants.”
She believes this is a major gap that remains unresolved in the market, with 70% of the tasks left to SMB manufacturers potentially being automated. “This is not a surgical robot, but something that can perform repetitive tasks in production.” In that regard, interestingly, there is a correlation between what a company like Robco is looking to fix and what a company like UiPath (a big investment in Lixandru’s past and in part is how she made a name for herself in VC) focuses on robotic process automation. , at the administrative end of running a business.
“This company has come a long way with very little,” she added, highlighting one of the other big signals that investors particularly believe in these days, indicating that Robco had only raised “a few million dollars before, [and] they have real customers, with a bunch of robots already deployed. We have a lot of data and proof that it’s working. I’m skeptical about 99% of robots [pitches] and I can see how hard it is to build a market around it, but we see the ‘why now’ here and that’s why we think it’s going to be successful.”
