The State of Robotics, AI & AV Startups in North America: what I found in 2022
This is the 1st of a series of posts about events I attended in Boston, Pittsburgh and Toronto, relevant startup hubs for active early stage investors. My purpose is to share a few impressions for a glimpse of the current state of Robotics, AI & AV Startups in the US & Canada. In the context of post-pandemic lessons, I traveled to meet founders in the robotics industry, a vertical addressing a critical labour shortage situation, with constant disruptions in the workforce and long term consequences that require investor’s acknowledgement.
As Monozukuri Ventures expands in North America, I have had the chance to visit a few selected urban hubs where robotic-related startups seem to be leading the future of manufacturing and automation, as highlighted by Nasdaq’s article on The Rise of Robotics: Companies to Watch Amid Rising Shifts to Automation. (Nov/22). A few highlighted points that is worth to keep in mind:
- The Drivers of Growth: Aging Populations and Low Birth Rates
- Two simple factors drive the growth of an economy: the growth of the labor pool and improvements in productivity.
Part of our role as an institutional VC specialized in early startup startups is to help Japanese corporations understand the latest trends they might have missed, specially from 2020–2022, due to the long two year hiatus of Japanese travel restrictions adding a new layer of challenges to the already relevant cultural gap that might be misunderstood or lost in translations.
As the Japanese yen depreciates and the costs for Japanese companies to expand their business overseas becomes higher, we've developed our own MZV US & Canada teams, building long term relationships with startup hubs in North America that can help such Japanese B2B players leverage their future plans.
Considering the hardware startup landscape, it's not a coincidence that my journey started in Boston, ranked #4 by Startup Genome 2022, a place I haven't been to in about a decade.
Boston: #4 Global Performance, #5 in Funding, #10 in Talent & Experience
As a key startup sub sector in hardtech and deeptech, thanks to the intense research activities from local universities and accelerators, robotics companies in Boston employ a relevant part of skilled talent in the region:
- Founder Institute AI & Robotics Accelerator program in Boston: partnerships with NASA Ames Research Center and MassRobotics
- Amazon Robotics Center BOS27: a few blocks away, I stopped for a specialty coffee at Blue Bottle, not aware of what was going on in the building — package sorting and last-mile delivery, working on the future of drone deliveries
While I had already booked flights to visit Pittsburgh Robotics Discovery on the following day, I decided to make a quick stop in Boston for a day trip to catch up with the robotics community. The chosen event was MassRobotics Demo Day, in Westborough, a port-town area accessible by free shuttle buses from Boston Logan Airport. It took me about half an hour from landing until I could arrive at the harbour area, which was super easier and way faster than expected.
As I had taken an early flight from Toronto, arriving at 11:50am in the sunny harbour area was a nice invitation to try a crabster (crab + lobster sandwich) and make sure I wouldn’t have any allergic reaction. These local shops might be quite famous among locals, as by 12noon all seats were taken, and among the customers, some Japanese ladies with their latest Marimekko collection, almost missing the last seats outside.
One of the questions for a VC investing in early stage hardware and manufacturing related-tech is why a place like Boston is still relevant for investments in startups in robotics, AI & AV. The number of companies might call the attention, including a few pre-seed stage ones.
- Boston — MassRobotics Demo Day Fall/22: about 25 companies showcased their latest solutions, most based in the Boston area; a few names from NYC and even a startup from Israel.
Pre-Seed/Seed Companies that might be raising soon
- Malamute (NYC): AI-layered industrial communication networks to empower workers with new actionable data, analytics, and communication channels.
- Nextera Robotics:industrial robotics and AI company created by MIT alumni, Nextera clients include Fortune 500 companies.
- Southie Autonomy: developer of a robotic platform designed to increase the viability of robots for use in more industrial applications.
A few companies from Boston
- Cleo Robotics: building the world’s first indoor friendly drone for applications such as law enforcement, surveying, security, and warehousing.
- Light Line: startup using autonomous mobile robots to deliver online orders the last 500ft in apartment buildings.
- iQ3Connect: web-based, scalable, and cost-effective approach for building and deploying enterprise product training solutions.
What I'm planning to check in Boston prior to my next visit:
- GreenTown Labs also had a hybrid event planned for the following day — EnergyBar: Go Move 2022 Kickoff, a startup-corporate partnerships accelerator program focused on decarbonizing transportation, in partnership with BASF and Magna. It looks quite interesting, so I'll make sure to plan a longer stay next time.
- Checking the rates of local hotels near the venue, I was also shocked to compare the costs of staying in Boston, specially after global business trips have resumed. For an average Japanese business traveler used to pay around a $100 usd per night for a night in a hotel with free breakfast, it'd be shocking to see rates about 3 to 4x their expected budget.
Unfortunately, I couldn’t stay until the end of the networking event as I had to be take the last flight to Pittsburgh, so my impressions were limited to a short stay of couple of hours. Surprisingly, not many visitors were at the Demo Day when it kicked off, and until the time I left, it felt like a small but very engaging community, not exactly what I’d expect from Boston.
My next post is about Pittsburgh Robotics Discovery.