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As the robotics industry continues to grow and mature, businesses are increasingly turning to robotics automation to boost productivity in the workplace, and address the challenges they face. These companies have found that robotic systems can effectively automate labor-intensive, repetitive, and hazardous tasks, keeping human workers fresh and healthy, while also speeding up the time it takes to accomplish those tasks.
What follows is a review of five major trends in the robotics and automation sector, along with how they are impacting industries. When referring to ‘robotics’, there are six main categories that are included under this term:
- Industrial Robots
- Collaborative Robots (cobots)
- Mobile Robots
- Unmanned Aerial Vehicle Systems (UAVs)
- Consumer Robots
USA Receives Most VC Funding
There is a growing eagerness among investors to back robotics startups. ABI Research has found that total venture capital (VC) funding in the robotics industry jumped by 38% between 2021 and 2022—bringing the total investment to US$6.5 billion. COVID-19 is a huge reason for the uptick in robotics investment as the pandemic has led to labor shortages, social distancing protocols, and supply chain constraints—leading companies down the path to automation.
The majority of countries simply lack the money and other resources to develop a strong robotics startup landscape. As a result, we see the big markets leading the way in the robotics industry, including the United States, China, the United Kingdom, Israel, the European Union (EU), etc. Overall, the United States is far and away receiving the greatest amount of VC funding in the robotics industry, encompassing more than half of total investment in 2021.
The United States and China account for six out of the top ten most heavily funded startups in the world (four U.S. startups and two Chinese startups). Both countries have excelled at growing startups with a diverse set of competencies, such as last-mile delivery, indoor Autonomous Mobile Robots (AMRs), autonomous drones, and machine vision services.
Healthcare has proven to be an enormous vertical for robotics, as these technologies are used for patient monitoring, inventory tracking, automating routine tasks, cleaning and disinfection, and even helping assist with minimally invasive surgeries. As pointed out in ABI Research’s Smart Technologies Revolutionizing the Home Healthcare Market blog post, a common trend in the robotics industry is the use of social robots to provide empathy and social interaction for elderly people. Robots can also be used for putting objects away for the patient and sending health status updates to physicians remotely. In 2021, robotics investments in the healthcare vertical were north of US$1 billion.
Although healthcare saw the most investment in the robotics industry, the delivery and warehouse verticals aren’t too far behind. While the delivery vertical saw US$958 million in investment in 2021, the warehouse and distribution vertical generated US$896 million.
Thanks to deep learning-based machine vision innovation, collaborative robots (cobots) are incredibly accurate and precise. Additionally, deep learning and reinforcement learning algorithms enable cobots to function more dynamically. For example, the robot will make real-time motion adjustments when it’s necessary to do so.
Robots are also better equipped straight off the shelf these days, in the form of Robotics-as-a-Service (RaaS). It’s commonplace for robots to come pre-trained for specific use cases, eliminating the requirement for system integrators, programming skillsets, and extra hardware.
Overall, the United States is far and away receiving the greatest amount of VC funding in the robotics industry, encompassing more than half of total investment in 2021.
California a Hotbed for Robotics
Although California has a huge influence in several robotics segments, drone services and last-mile delivery were two verticals that really stuck out in 2021.
California Startups in Drone-Related Services – DroneBase, Shield AI, and Zipline are just three of many California-based drone services companies that have received a significant amount of financial backing recently. DroneBase provides an aerial data analytics platform that allows companies to monitor assets, plan for maintenance, and understand site conditions. In 2021, DroneBase raised US$32.5 million in Series C funding.
Shield AI focuses on military and civilian defense using its dynamic UAV solutions. With the company’s Hivemind software, the UAVs can fly without the need for a Global Positioning System (GPS), communications, or even a remote pilot. The learning algorithms that Shield AI UAVs come packed with allow the autonomous aircraft to decide what the best strategies are when operating. Besides raising US$280 million in funding, Shield AI has also made two recent acquisitions: Martin UAV and Heron Systems.
Zipline offers UAVs for the healthcare and retail industries and raised US$250 million in Series E funding in 2021. Much of the company’s focus is on Africa where its drone services are used to distribute medical supplies to impoverished regions. For example, the country of Ghana used Zipline for COVID-19 vaccination distribution in November 2021.
California Startups in Last-Mile Delivery Robotics – Besides the drones segment, California has numerous startups working on last-mile delivery robots. Coco, Nuro, and Starship Technologies are three promising startups based out of California developing autonomous delivery solutions. In addition to making deliveries to residences via sidewalk and to students on college campuses, big-name companies like Domino’s and FedEx have shown great interest in these types of technologies. Collectively, these three California-based startups raised US$653 million in funding in 2021, with Nuro receiving US$600 million alone.
Acquisitions Run Rampant
As established brands want to expand their robotics product portfolios, industry acquisitions have been par for the course. ABB is an early mover among big-name industrial robot vendors when it comes to Autonomous Guided Vehicles (AGVs) and AMRs as the company bought out ASTI, a company that has more than 4,500 AMR deployments.
JASCI, a company that develops Warehouse Management Systems (WMSs), recently acquired NextShift Robotics. These robots are equipped with a conveyor to pick up totes and also transport the totes over to a selected workstation. A solution like this saves human workers a great amount of time and energy going back and forth with totes all day.
In 2017, SoftBank purchased Boston Dynamics from Alphabet for about US$1 million. However, that valuation skyrocketed to US$1.1 billion in 2021, when SoftBank came to an acquisition agreement in which Hyundai Motor Group took over. Hyundai Motor Group views the addition of Boston Dynamics as a stepping-stone to greater things in the following spaces: autonomous cars, logistics, construction, manufacturing, and urban air mobility.
The robotics industry is changing before our eyes and if we do not examine key trends shaping these exciting technologies, we just may miss out on lucrative business opportunities. Whether a new robotics vendor wants to see what other startups are up to or if a C-suite yearns to learn more about the current industry landscape, these five trends serve as the first step on that journey.
About the Author
Lian Jye Su, Principal Analyst at ABI Research, is responsible for orchestrating research related to robotics, Artificial Intelligence (AI), and Machine Learning (ML). He leads research in emerging and key trends in these industries, diving deeply into advancements in key components, regional dynamics in robotics and AI adoptions, and their future impacts and implications.
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