Investors continue to prove out their interest in letting robots do the heavy lifting in warehouses—literally.
Vecna Robotics, the Waltham, Mass.-based startup, announced Thursday it has raised $35 million in a Series C-1 round, which it started raising in March of 2022.
That Series C-1 comes on the heels of the $65 million Series C round the company announced in January 2022, bringing the total Series C raise to $100 million. Tiger Global Management, Proficio Capital Partners and Impulse participated in the round.
The company plans to use the funds to bolster a new type of robot it plans to bring to market in early 2025. Currently, the robots as a service (RaaS) company offers its clients robots that can move full pallets. However, the robots coming out in 2025 will be able to case pick, allowing companies to build rainbow pallets.
That means that, when companies don’t want to ship one full pallet of the same item, they can add multiple different items to the same pallet. Right now, that process is typically done manually, Mike Bearman, chief customer officer at Vecna, said.
“The traditional case pick is there’s a person riding on a pallet truck, and they’ll jump on, drive it to the first location, pick what’s needed from that location, then drive it to the next location,” he said. “They’re really just building one pallet at a time…and because of that, it’s highly inefficient.”
Related Stories
With Vecna’s upcoming technology, though, robots will be able to pick the products for humans to manually arrange on the rainbow pallet, saving humans the extra step of driving—or walking—around the warehouse to grab the goods needed to build out the pallet.
Vecna is trialing the robots with its logistics client Geodis, and Mike Bearman, the robotics’ company’s chief customer officer, said the progress—particularly in terms of ROI and throughput—has been steady.
“Our initial trial with Geodis continues and has experienced massive throughput gains of almost 100 percent. We are working [on] projects right now through our limited availability program, and [ROI] projections are huge,” he told Sourcing Journal.
Geodis has 12 case-picking robots in its trial warehouse, with between two and four humans supporting the robots’ work and building rainbow pallets.
Bearman noted that Vecna’s partnership with another “top-tier 3PL” company has yielded strong projections for ROI. Vecna believes that client will see 38 percent ROI through 80 percent improvement in throughput, though the data has yet to be validated.
Many e-commerce companies use each-picking robots, which can grab one item at a time to be placed into an order. Vecna doesn’t offer that kind of solution, and its case-picking robots will likely prove more of a B2B solution. Vecna plans to launch the new robots in January 2025 with a select group of customers, then launch more broadly in April 2025.
Vecna will also use the funding to add employees to its customer operations, sales and hardware engineering teams, though Bearman said it does not yet know how many new people it will need to add to the team.
That increase in headcount could help juggle increased interest in scaling partnerships from existing clients, Bearman said.
“One of the things that we’ve focused on this year is just an expansion of existing customers—either additional workflows in the same warehouse, or new warehouses that we can deploy this in,” he explained. “It’s a vote of confidence from the customers to say, ‘Yes, this is a mature product; we’re seeing this as something that is a great ROI and want to put it in more places, to implement it more broadly.’ We’re super excited to see that progress.”
Vecna’s existing customers include FedEx, Caterpillar, Shape Corp and more. As companies increasingly focus on how automation can optimize supply chains and operations, Bearman said, Vecna continues to see increased interest, and accordingly, expects to continue growing its customer base as it supports its current customers.
“Labor isn’t quite as crazy as it was during the height of Covid, but there’s still [companies that] experience labor shortages and challenges of hiring into these jobs,” he said. “We still see increased growth and demand for automation in these areas.”