Covariant Adds $75M in Series C Funds to Meet Customer Demand for Scaled AI Robotics Deployments
QUICK TAKE
- Covariant, the world's leading AI Robotics company, has raised $75m in additional Series C funding to meet customer demand for its technology from global retailers and logistics providers.
- The funding will be used to ensure Covariant’s robotic picking technology can be deployed quickly and without disruption to supply chains, guaranteeing customers achieve value and increased efficiency from day one.
- More than 80% of retail leaders see automation as a key solution for navigating operational uncertainty and 98% plan to further invest in AI Robotics in 2023, according to Covariant research.
- The round was co-led by Index Ventures, and brings Covariant’s total funding to $222 million.
INDEX PERSPECTIVE
‘The move to warehouse robotics is here and Covariant is leading the way’
By Mike Volpi, Partner
While robotics could be found in fulfilment warehouses when we first invested in Covariant in 2020, sorting, picking and packing remained dependent on a human workforce – robots were simply unable to effectively identify objects, or handle them in the correct way, with the right amount of pressure.
Fast-forward to 2023 and things are changing: the move to AI-powered robotics in warehouses has arrived, and the switch is widely down to Covariant leading the way. Having spent years developing a proprietary AI software known as the Covariant Brain, the company has begun releasing its technology into warehouses, working with some of the leading logistics providers, distributors and eCommerce fulfilment providers across apparel, pharmaceuticals, groceries and more.
As e-commerce’s share of retail increases and labor shortages across the US and Europe continue, demand is only growing. I’m confident that innovation from this team, which represents the best minds in AI, will continue to shape the future of automation, and look forward to the progress they’ll make in the years ahead across logistics and beyond.
THE DETAILS
In its early years, Coveriant's founding team of Pieter Abbeel, Director of the Berkeley Robot Learning Lab at UC Berkeley, and three Open AI alumni – Peter Chen, Rocky Duan, and Tianhao Zhang didn’t hire a single mechanical engineer or robotics expert. Instead, they were laser-focused on developing an advanced AI technology that could identify, pick and pack the millions of different items that pass through global supply chains.
The reason for this was that the team had identified the major issue with previous attempts to effectively use robotics in distribution centres: they were powered by off-the-shelf and open-source technology that simply wasn't up to the task.
The result has been the development of an industry-leading AI platform that learns on the job – the Covariant Brain. Since the company’s initial Series C in 2021, Covariant has successfully applied this to a broad set of applications across manual warehouse operations. In less than two years, the company’s product portfolio has now grown to include order sortation, item induction, good-to-person order picking, kitting, and depalletization solutions – all powered by a unified AI platform.
Leveraging the first foundation model for robotics, retailers, 3PLs, and warehouse integration providers are able to use the same AI platform to power a variety of robotic systems regardless of use case, facility type, or location. Connected robots learn as a fleet – enabling operational improvements to automatically propagate across customer networks. Covariant currently has customers in 15 countries and nearly 300 robots powered by the Covariant Brain.
Successful deployments of the technology include the use of 12 Covariant Robotic Putwalls by Radial, one of the leading B2C eCommerce fulfilment providers, and the use of Covariant-powered KNAPP Robots by McKesson – the largest drug distributor in the United States – and GXO, the world’s largest pure-play contract logistics provider.
"The leading companies have turned to AI Robotics to automate their most manual operations in order to decrease labor costs, increase throughput, and control profitability. The past year for Covariant has been incredible with 6x growth in 2022 – and we are just getting started. This infusion of new capital allows us to scale even faster, ensuring more retailers can automate more parts of their fulfillment networks to remove manual bottlenecks, handle fluctuating demand, and better prepare for ever-changing business needs."
— Peter Chen, Chief Executive Officer, Covariant.
As existing Covariant customer uses and pilot schemes expand, the second Series C funding round of $75 million announced today will be used to ensure retailers and their logistics providers are able to deploy robotic picking quickly and without disruption to their current operations – guaranteeing customers see value and a boost in efficiency from day one.
The funding comes at a time when retail executives are eager to invest in AI-powered robotic automation: more than 80% of retail leaders see automation as a key solution for navigating operational uncertainty in an unpredictable marketplace, and 98% plan to further invest in AI Robotics in 2023 despite current economic conditions, according to a February 2023 Covariant-led research survey.
The $75 million in additional Series C funds brings Covariant’s total funding to $222 million. The round was led by returning investors Index Ventures and Radical Ventures, with participation from Canada Pension Plan Investment Board and Amplify Partners. The round also included new investors Gates Frontier Holdings, AIX Ventures, and Northgate Capital.
Published — April 4, 2023
