Most VC-backed AI-powered Robotics Businesses raced to this field to handle pick-and-pack applications with the rapid expansion of E-commerce.
From an Economic Standpoint, tackling E-commerce makes perfect sense, as it is the single most lucrative market for robotics businesses, and labour shortages and turnover are common in the industry. Amazon spends billions of dollars on labour alone in centers, which might theoretically be grabbed by robots.
However, many robotics businesses have discovered that breaking into the E-commerce market is not as simple as it appears. There are numerous barriers that they did not anticipate at the outset. Robots must be capable of handling millions of objects in a short period.
Pick accuracy of 99 percent is on par with human operators. This isn’t a minor task, and it’s not one of the few things that AI-powered robots can gracefully perform in lab demonstrations. When interacting with Fortune 500 firms, there are also logistical stumbling blocks, to begin with, large corporations are highly bureaucratic and have sales cycles that last a year.
Those never-ending sales conversations suffocated cash-strapped businesses before they could even show their minimal viable product. Then there’s the trap of the proof-of-concept project. Many startups regard POCs from large corporations as proof of product-market fit. If a proof of concept isn’t related to a deployment contract, it’s generally a mirage.
Few individuals are aware that huge corporations have POC funds that can be used for a variety of purposes. Start-ups have educated them, and they aren’t necessarily interested in being loyal clients. The “pilot purgatory” is another notable barrier. Start-ups are in pilot mode for one to two years, with no clear end in sight and no clear roadmap from customers on how or when to deploy their robots.
Start-ups frequently make the mistake of overestimating the capabilities of their technological stack. Many businesses openly overpromise to potential investors and clients.
The capabilities of today’s robotics are light years ahead of what we see in science fiction. Robotics is a fragmented field, and there is still a lot of infrastructures to be built before robots can live up to their potential.
The failed robotics firms overestimated the effort required to make the move from a prototype to a working product. From a lab demonstration, which is a controlled environment, to a messy real-world situation. Many corner situations arose out of nowhere in these unstructured environments, hurting the robots significantly.
These cutting-edge technologies were considered too intellectual and not ready for commercial environments by potential clients. Scaling a robotics fleet has also been a major challenge; although a tech start-up can construct two or three robots, scaling a fleet is a completely different ballgame, which robotics businesses have often struggled with.
While a few venture capitalists have become wary of the robotics area, funding is still plentiful, and die-hard robotics investors and other affiliates continue to make massive investments.
The emergence of VC-backed robotics firms is rising as the epidemic accelerates automation higher than ever before.
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