Robco links up with $14M led by Sequoia to bring modular robotics to industrial SMBs
Summary
After years of outsourcing and offshoring manufacturing to countries with cheaper labor and bigger production ecosystems, the U.S. and Europe are on a mission to bring some of that industrial work back to its own shores. The plan is to bring on more modules in milling and quality inspection, as well as to look at further geographical expansion, for example into the U.S. market.Even with the hundreds of millions of dollars that have been poured into a variety of industrial automation and robotics companies over recent years (and some of the very notable failures that have inevitably come out of that) Robco believes that it has found a niche in the market by focusing on tricky tasks and building cost-effective solutions to address the needs of smaller manufacturers. We are basically offering an automation service, and solving a concrete problem.H\xf6lzl describes the traditional approach of hiring machine operators as the classic status quo something he saw firsthand in his parents own small factory, which was the inspiration for founding the company in 2020 not, as you might have thought, COVID-19 and the pressure it put on in-person work, although that certainly gave Robco a strong current on which to generate interest and eventually sell its ideas into the market.One reason was that many factories had to lay off rather than just furlough their staff, and then when it came time to get back online, they couldnt fill out tasks and some of their costly manufacturing machines just sat vacant, and that was before considering the weekends and evenings when staff that was there didnt work. Typical deployments start at 10 modular machines, he said.This is taking off massively, he noted, with strong triple-digit revenue growth, exciting unit economics, and so far four patents on its hardware and techniques from a founding team spun out of a big research university and thus grounded in AI and engineering expertise all details that would have attracted investors like Sequoia that have only relatively recently really doubled down on Europe with a shiny new office in London, but like others in the world of VC are facing huge pressure around existing portfolio companies and how they are weathering the significant storms that have hit the tech sector.All of that spells more prudent, and perhaps less exuberant, investing, which likely means more strict adherence to theses around making returns and less about exploring interesting ideas.Robcos approach is unique [in the SMB manufacturing space] because what they are doing is a little like Lego. Then the configuration and control is easy something that previously would have required more technical expertise or outside consultants.She believes this is a big gap that has yet to be tackled in the market, with about 70% of tasks for SMB manufacturers capable of being automated.