6 River Systems

Overview

6 River Systems is a robotics startup that creates warehouse fulfillment robots and AI systems.  The team builds both the AI software that manages the robots as well as the physical robots themselves.  In most fulfillment warehouses today workers pick items for shipping off the shelves by following a piece of paper and manually picking their route.  In contrast, 6 River systems has the worker or "picker" as they are called in the industry follow the robot as it optimizes for the route while picking items off the shelf and giving them to the robot to carry.  The system dramatically increases the key metric in fulfillment centers of items picked/ hour.  Their system is quick to deploy, easy to use, and generates value from the first day of deployment.  Customers include 3rd party logistics companies, industrial suppliers, traditional retailers, and young eCommerce companies.

6 River Systems differs from Amazon's famous Kiva robots by having the pickers go to the item whereas in Amazon's fulfillment centers the robots actually bring the shelves to the picker.  6 River Systems will never have the throughput of Amazon style systems, as they don’t eliminate walking, but they are able to sell their product with much less equipment and for far less than an Amazon style system.  The company likes to describe this as having 80%  of the benefit of warehouse robotics at 20% of the cost.  

In terms of business model the company sells the systems and software as well as offers a Robotics as a Service option where they lease the robots out.  The Robotics as a Service offering is popular as many companies in this space have thin operating margins and don't like to make expensive capital expenditures.  6 River Systems robots will be used at 30 sites by the end of this year.

The company is based in Boston and has 60 people.

Why I like Them

eCommerce continues to boom and will grow over the coming years globally as physical retail continues to shrink.  Automating fulfillment centers will only become more important as companies try to stay competitive.  6 River Systems has the perfect product offering to replace what today is mostly a manual process.  Collaboration robotics, where both a human and robot work together simultaneously, is the big trend to watch over the next decade in the field.

Like a number of people who follow the technology industry I am very excited for the future of robotics and automation.  The team was kind enough to explain their view that the reasons robotics is starting to see widespread adoption today include the intersection of: 

• The miniaturaization and drop in costs of hardware including sensors, mainly due to the growth of the smartphone industry
• The rise of Open Source software allowing for accelerated software development especially by small startups
• Cloud based computing allowing infinite computing capacity for a low cost 

Disclosure:  I have spoken to members of the team.

NoiseAware

Overview

NoiseAware is an Internet of Things (IoT) startup that sells a device and associated monitoring service to automatically detect noise pollution at any location.  Noise pollution can include anything from loud traffic locations to parties, or just unacceptable levels of noise after a certain time period.  When such an event occurs the property manager is alerted and can take appropriate action.  Their technology is smart enough that one off background noises (such as sirens) will not activate an alert.  

NoiseAware is currently focused on selling to landlords, especially for short-term rentals such as people listing on AirBnb, HomeAway, etc.  Their next area of expansion is the outdoor monitoring for pools, hot tubs, and patios where noise disturbances travel much further. The team has excellent traction with customers in 14 countries and most of the 50 states. 

They are based in Dallas, Texas and have 10 employees.

Why I like Them

As is often mentioned, "hardware companies are hard".  That being said I like that NoiseAware uses their hardware as a lead into their subscription service and have a very distinct (yet broad) niche with little competition.  They have a distinct advantage over general purpose at home IoT devices, such as Amazon's Echo, in that they only listen for noise pollution, so privacy is not violated.  Any landlord will know noise complaints can easily cost a lot of money and signal damage being done to the property.  The company has grown extremely fast with the popularity of AirBnb and the industry of multi-AirBnb property managers that have sprung up in the last few years.

I also really like that this technology has surprisingly widespread applications.  The obvious use case is for rentals (a large market as it is) but the team has received a ton of interest from hotel chains, city officials, school dormitories, senior living communities - basically anywhere people sleep has shown an interest in this type of monitoring system.

Disclosure:  I have spoken to members of the team.

Samsara

Overview

Samsara is an Internet of Things startup that offers a cloud platform solution for industrial sensor data.  Their focus is on providing real time analytics and ease of analysis  for industrial sensor system across a number of industries.  Their product team is focused on a complete solution for their customers so they design the software, hardware, and necessary network infrastructure all in house.

Their in house designed sensor systems (no OEMs) focus on ease of deployment and provide the cloud backend so that their sensors drive meaningful improvements once installed.  Sensors to date include cameras, GPS systems, temperature gauges, environmental sensors, electrical power monitors, etc.

The firm was founded in San Franciso in early 2015 and is currently around 100 employees.  It's cofounders, Sanjit Biswas and John Bicket, are successful serial entrepreneurs who previously sold cloud networking company Meraki to Cisco Systems for $1.2B.

Why I like Them

I 100% agree with Marc Andreessen's belief that within 20 years every physical item will have a chip in it and a wireless antenna. Samsara is at the forefront of this wave with their focus on ease of deployment and making the data these items provide digestable and usable by the end customer.  The team is extremely focused on a plug and play model that offers a complete solution to industrial sensor users, many of which are industries that have not seen as much software automation as you'd expect.

Most of Samsara's business currently comes from logistic and transportation fleet tracking.  An example use case in this market is that the company immediately knows if one of their trucks has had an accident as well as track in real time the position, fuel efficiency, etc of a fleet of thousands of vehicles.  Reports from the team are that their product is a relatively easy sell to dispatch services and fleets.

Beyond the above I am also very excited about the potential applications of Samsara's cloud platform across many other industrial sectors.  It is easy to see how this product could be used across the food industry's cold chain to monitor produce conditions from the farm all the way to the checkout line in the grocery store.  Also, traditional manufacturers of physical goods can easily use this type of technology to monitor products during a manufacturing process, warehouse storage, and transportation.

By all reports their latest $40M in venture funding in June 2017 was driven by investor demand, not by a strong need by the company.

Fleet Tracking Overview Page of Samsara's cloud platform

Disclosure:  I have spoken briefly with members of the company's product team.

Amber Agriculture

Overview

Amber Agriculture is an agriculture technology startup focused on optimizing and managing crops in storage.  Post harvest grains are stored in giant silos until ready for transit.  Amber has developed pellet sized wireless sensors connected to the cloud that are distributed with the crops through storage all the way to ending up on grocery store shelves.  These sensors monitor moisture levels, carbon dioxide, temperature and chemical compounds in the air of the silos or shipping containers.  Their first application with this data is to automatically turn on and control fans to prevent crop spoilage and alert farmers of any issues with the crop.

The company is still early stage having recently launched several pilots for their product.  The team is based in Champaign, Illinois.

Why I like Them

Amber is part of the digitization wave sweeping the agriculture industry in the last five years that will allow humanity to feed itself with a rapidly growing global population.  As I have written several times on this blog I am a huge fan of using IoT for old world industrial type of processes to give real time data and allow optimization.  Even small amounts of moisture damage to a crop can lower the price dramatically and when scaled up to massive grain silos the potential savings of this product add up to the tens of thousands. 

This type of cheap, easy to distribute technology will be especially useful to farmers in emerging market countries with tougher climates where crop spoilage is a very severe issue and can financially ruin farmers.  India is a prime example where crop spoilage and rot is a severe threat to the food supply with an average harvest losing 30% of the crop.

Disclosure:  All information is from publicly available sources, I have not had any contact with a member of the company or its investors.

Emerging Trends: Automated Food

In the last couple of years a number of startups have appeared in the restaurant industry that seek to automate completely the process of preparing and serving everything from casual meals to beverages.  Several of these startups include:

• Eatsa - A new restaurant concept that is mostly automated and defined by customers having zero interaction with the employees.  Food is ordered online or via in store ipads and when completed appears in electronic cubbies that show the customer's name on them when ready.
• Cafe X - A startup that has built and opened in San Francisco a fully robotic coffee shop.  The actual coffee itself has been reported to be higher quality and half the cost of nearby coffee shops.
• Momentum Machines - A team of roboticists building robotics for restaurants including a high end fully autonomous hamburger machine that can replace 3 workers per machine.  Their mission is explicitly not to build machines to help restaurant workers but to completely replace them.  The startup has plans to launch a burger chain in the next several years.  

As cool as these technologies are, it is critical to keep in mind that they will dramatically replace low skilled human labor.  The US government estimates there are currently half a million people employed at fast food and fast casual eateries.  It is looking like over the next 5-10 years almost all of these jobs will be automated away.  Critics say that consumers prefer human interaction but in my experience a number of people actually prefer not having to interact with another human to purchase a product, especially if an automated system is faster.  In fact, to a number of people (myself included) having no human social interaction when getting food is a feature, not a bug, and something some might even pay an additional amount for.  Larger chains that have kiosks in stores report younger customers will actually wait in line to order from the automated kiosk rather than order from the completely available human cashier next to it.

It is obviously impossible to know without seeing their financials but my guess would be the unit economics for a Cafe X like store are great per order served with faster service, more accurate orders, and less management once the store is setup. Automated produced food has already proven to be faster at dealing with lunch rush hours, sanitation, and food quality consistency.  Simultaneously, some of the labor savings costs can be reinvested into the food itself with higher quality ingredient meals available at lower prices.

Large chains such as Chipotle, McDonalds, etc are certainly watching these startups with keen interest to see consumer reactions and salivating at the chance to cut their rising labor costs.  My prediction is within the next 4-8 years lower end eateries will be 80%+ automated for more efficiency at lower cost.  Human service and interaction will be one of the selling points of mid and high end more formal restaurant dining and even that part of the industry will likely become heavily automated.