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Fabric closed $200 million in Series C funding to develop its Automated Storage and Retrieval Systems (AS/RS) systems for micro-fulfillment. The funding values Fabric at more than $1 billion. The company, which was formerly known as CommonSense Robotics, has raised more than $336 million since it was founded in 2015.
The Series C round was led by existing investor Temasek, with participation from Koch Disruptive Technologies, Union Tech Ventures, Harel Insurance & Finance, Pontifax Global Food and Agriculture Technology Fund (Pontifax AgTech), Canada Pension Plan Investment Board (CPP Investments), KSH Capital, Princeville Capital, Wharton Equity Ventures, and others.
Fabric will use the funding to expand its fulfillment platform across the general merchandise market and build a network of micro-fulfillment centers across major metro areas in the U.S. Fabric runs micro-fulfillment operations for grocery and general merchandise retailers in New York City, Washington DC, and Tel Aviv, Israel. Some of its major customers include Walmart, Instacart, and FreshDirect.
“While we use the term ‘robocorn’ a bit tongue in cheek, we see this milestone as a real turning point in the industry, from what was once trepid exploration of micro-fulfillment to total market validation and now rapid expansion,” said Fabric co-founder and CEO Elram Goren. “We’re thankful to our partners for trusting us to serve them and to our incredible team who will continue moving mountains to make our vision a reality. This is still ‘day one’ for us, and we’re extremely excited about the road ahead as we expand our offering into new markets, drive more efficiencies across the supply chain, and focus on scaling.”
E-commerce sales penetration more than doubled to 35 percent in 2020, the equivalent of roughly ten years of growth within a few months. This surge in online shopping has been compounded by evolving consumer expectations to receive their orders faster than ever, an expensive and challenging proposition for retailers. This trend will only continue, Fabric said, as the same-day delivery market in the U.S. is poised to grow by $9.82 billion over the next four years. Despite this surge in consumer demand, fulfillment capacity has struggled to keep up, and finding and retaining labor remains a costly bottleneck.
“We believe the movement to local fulfillment presents an opportunity to make retail and e-commerce more sustainable, and we’re thrilled to partner with the leader in micro-fulfillment to make this vision a reality,” said Eric Kosmowski, Managing Partner at the Princeville Climate Technology Fund. “By leveraging existing real estate with a small footprint in close proximity to end consumers, utilizing more sustainable packing materials, and minimizing shrink and waste through smart inventory management, Fabric’s micro-fulfillment centers could lower last-mile emissions significantly.”
AutoStore is perhaps Fabric’s biggest competitor in the AS/RS space. AutoStore, a 2021 RBR50 Robotics Innovation Award Winner, debuted last week on Euronext’s Oslo Stock Exchange. The Norwegian robotics firm priced its initial public offering (IPO) at 31 Norwegian crowns per share, which valued the company at 103.5 billion crowns ($12.4 billion).
AutoStore has 20,000-plus robots deployed across more than 35 countries to automate warehouses. AutoStore generated net revenue of $182.1 million in 2020 and expects revenue of about $300 million in 2021. It expects that to rise to more than $500 million in 2022 with a project pipeline worth $3.4 billion across 2,000 projects.
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