Joining forces with RobCo for an autonomous and automated future

Today, we are excited to announce that Lightspeed is partnering with RobCo, Germany’s ground-breaking plug-and-play robot automation platform, and leading their $42.5M Series B round. Through this investment, we hope to accelerate RobCo’s mission of creating truly embedded physical/digital experiences, fueled by exceptional hardware systems and generative AI.

Only by uniting digital and physical experiences, can we tackle the major macro challenges ahead 

Worldwide, we’re facing major shifts in the next decade. Rising geopolitical tensions and the fragile nature of global supply chains is leading to a relocalization of value creation. With the rise and impact of AI, we’re seeing a major platform shift; not only in software but also the physical world. And developed industries face an unprecedented skilled labor shortage amidst the great retirement, further restricting economic growth. Value chains, therefore, have to be completely rethought.

In light of all of this we see three major developments happening:

• A re-industrialization of developed economics, especially in the USA and Europe, as companies are forced to reinforce the resilience of their supply chains.
• We will see widespread automation in white-collar but even more in blue-collar tasks to maintain competitiveness on cost but also on quality.
• The physical and digital worlds will blend until we witness truly embedded experiences.

A market creation moment for robotics

Industrial companies face a conundrum that only widespread automation can solve. Given these macro trends, industrial companies are re-bundling their value chains locally in Europe and the USA. However, they are faced with cost pressure plus higher expectations of quality and at the same time limited by labor shortages. It is no surprise therefore automation is front and center for executive boards. 

Whilst automation continues to accelerate, the installed base of robotic arms is still relatively low, especially at midsize manufacturers. Just under 600,000 new robotic arms were installed in 2023, and less than 10% were deployed at SMBs.  

The biggest opportunity for automation is in industrial SMBs. And with nearly 400,000 SMBs in Europe – we see a big opportunity on RobCo’s home soil. This represents a unique combination of a massive total addressable market (manufacturing is the EU’s second largest market by GDP) with a low penetration of automation. 

RobCo – solving labor shortage where it’s most prevalent today

RobCo grew its roots at the Technical University of Munich, one of Germany’s leading robotics research centers, and is attacking the automation challenge at its core. 

Founders Roman Hölzl, Paul Maroldt, and Constantin Dressel have developed a unique modular robotic platform that allows SMBs to leverage RobCos robotic arm in multiple settings. In addition, RobCo combines its proprietary patented platform approach with a novel business model – Robot-as-a-Service (in short: RaaS). 

RaaS allows small and midsize manufacturers to pay for robotic services on a monthly basis instead of buying hardware. Manufacturers see an immediate return of automation, while avoiding large upfront investments, and they’re able to transform robotics budgets from CapEx to OpEx. 

This combination of a unique technology platform and a novel business model has enabled RobCo to deploy thousands of modules already, less than two years after entering the market. That’s an unheard of benchmark for execution speed and efficiency in robotics, even outperforming many software-only companies. 

Building the installed base for a platform shift in robotic automation with AI

At Lightspeed, we’ve been investing in this space for many years and have backed category-defining companies like Dexterity and Reliable Robotics (to name a few). We believe RobCo is uniquely positioned to build the biggest industrial robot install base and become the leader in autonomous automation. Our thesis is based on three core components:

• Building a platform play: RobCo has developed a unique, vertically integrated hardware and software platform. Core differentiation comes from owning a modular end-to-end system that is equipped with all interfaces for the future. A unique sensor and software layer makes the durable hardware systems future proof.
• Deploying a scaled physical asset-base as a baseline for the next wave: RobCo is building the physical asset base with a scalable go-to-market motion. This is a unique access point for the next wave in robotics, fueled by generative AI applications for self-learning.
• Attacking untapped automation potential: RobCo is not only serving currently automated processes for enterprises, it is also enabling use cases even at lower volumes by providing simple, quickly deployable, ROI-driven solutions. 70% of RobCo’s customers are deploying a robotics solution for the very first time.

With the advent of foundational models for robotics as well as recent advancements in sensory input and vision, we are only at the beginning of a widespread automation journey. RobCo, with its easy-to-deploy and from day-one ROI positive robots, is uniquely positioned to become the dominant platform for advanced automation technologies fueled by AI.

Europe’s core strength has always been building exceptional physical systems that are superior in quality, durability, and innovation. We believe the next generation of category-defining companies out of Europe will bring together these core strengths with a truly open digital platform. “Made in Germany” has the potential to resurface as a unique label in robotics globally. 

If you are keen to join on this journey, you can find RobCo’s job board here.