business review

Fourth Quarter TRANSACTIONS REPORT 2016 and Annual Review

RoboticsBusinessReview.com Q4 2016 / Year-End Financial to increase production efficiencies, ABI estimates annual revenue will exceed $30 Robotics Industry Round-Up billion by 2020 and nearly $45 billion in 2025. The end of Q4 2016 marked a tremendous year for the robotics industry. Within the Takeaways from Q4 and 2017 quarter, transactions including direct • From a global perspective, will investments, &A, government funding continue to forge ahead and be a mega driver and IPOs, reached well over $60 billion. A of growth. It’s expected that by 2019, almost substantial portion of transactional value was 40% of the global supply will be installed in derived from healthy acquisition activity led China. by enterprises seeking to disrupt or further gain a competitive advantage. Of the 40 • The competitive landscape of industrial plus acquisitions that occurred in 2016, the robots is becoming more fragmented, with industry experienced a phenomenal $105 the big four industrial automation players – billion in $1 billion-plus acquisitions. KUKA, ABB, Fanuc and Yaskawa Motoman- taking upwards to 50% of the global industrial The robotics market made noteworthy market. The number of small and mid-sized advances in performance, including players battling to for the remaining market developments around AI and machine share continues to increase. intelligence which signaled a point of inflection. Increased utilization and adoption • The increased level of connectivity of robots for non-industrial applications (e.g. and cloud-based AI and machine learning service, retail, hospitality, in-home assistance) applications will increase investments in IOT/ began to blossom. As the tech industry IIOT and the factory of the future movement. continued to hone in on developing connected environments and AI seeped deeper into • Increased deal flow is expected to the creation of robot solutions, the industry be further pushed along by companies moved closer to providing multiple solutions leveraging a collection of technologies to capable of engaging with humans on a advance competitively or create disruption. level supporting viable commercial service • Robotic solution providers are moving applications and even companionship. toward pricing levels and models that support Depending on which research numbers increased adoption by global small and are referenced for benchmarking industry medium-sized enterprises (SMEs). growth, stats suggest industrial applications • SMEs looking to adopt or scale must have traditionally accounted for upwards be actively investigating their options now to an estimated 70% of overall robotics and can’t hold out for the right economic market revenue. However, in 2016 there conditions if they wish to achieve a was signification recognition and usage of substantial completive advantage with non-industrial applications, especially in the robotics. service category. This trend will prompt a shift in investment focus, as indicated by market • As is the case in the warehouse logistics intelligence firm Tractica, which estimates segment, quality improvement requirements “industrial robots will only see 41% of total will prompt increased adoption while pushing robotics revenue with the remaining 59% solution providers to further advance their belonging to non-industrial robotics” in the systems. near future. • Original equipment manufacturers (OEMs) Although emerging markets are starting to are currently “front runners” in the investment show promise, applications arena due to deep ties to the research remain strong, as can be seen in the community and regular monitoring of end- number of units shipped for that segment user service requirements, according to some (see shipment section). ABI research firm analysts. estimates that industrial robot shipments will exhibit an average year-over-year (YOY) • Robotics remains a technology seeking growth rate of 16% by 2021. As industrial a place in many markets with a need for robots continue to scale within the workforce broader traction. This will not occur until

RoboticsBusinessReview.com 3 business models are further developed • There is no clear market leader defining the and R&D and installation cost become less direction of the industry – or specific vertical prohibitive. - and there is no clear definable investment trend to point to when evaluating 2016 financial result. Robot Shipments:

The North American industrial automation On the buy side of the equation, more than market continues to show steady growth with 6,320 robotic units (exceeding $243 million) the total number of units shipped growing were sold to Mexico to help the country 10.2% from 28,000 at $1.6 billion in 2015 support its leading growth engine. This to 30,875 at $1.8 billion in 2016, according positions Mexico as seventh in global auto to the Robotic Industries Association (RIA). production and inches country closer to larger The association notes that since 2011, when players such as U.S., Japan, and China. 18,000 units were shipped at $1.1 billion, the number of units shipped has almost doubled. Globally, shipments of industrial robots remain solid, buts it’s Asia – driven by China - that Of the shipments in 2016, automotive continues to take a strong lead in automation carmakers and component manufacturers and robotic shipments. The Asia-Pacific region accounted for the largest percentage with a currently leads in shipments of industrial combined 22,743 shipments. robots, accounting for approximately 65% of the global market, with China responsible for Worth noting, is that as robots become more roughly one-third of worldwide shipments, affordable and flexible, significant growth according to data by ABI Research. is occurring in other areas of industrial production including plastics, rubber, food and China is in the process of revegetating beverage, consumer goods, electronics, and its manufacturing sector and the Chinese pharmaceuticals. governments’ automation 2025 initiative aims to make China a leader in automation Of the more than 30,000 robots that shipped globally. By 2019, it’s forecasted that almost last year, 90% were articulated robotic arms. 40% of the global supply will be installed in SMEs are a particularly bright spot, noted the China. Continued growth in robot installations RIA. is predicted for all major Asian robot markets: Korea, Japan, Taiwan and other Southeast Bordering US countries Mexico and Canada, Asian countries, based on a forecast by the also saw stable growth. In Mexico, shipments International Federation of Robotics. went from 4,632 at $182 billion to 4,984 at $218 billion, most of which was significantly driven by its growing footprint in automotive.

RoboticsBusinessReview.com 4 imaging software targeted at construction SEGMENT companies. DEVELOPMENTS Deals on non-delivery drones involved Drone market tightens in various tasks such as field surveys, surveillance, mapping, and monitoring nearly Significant attention is being given to the use doubled in 2016 from 2015. According to CB of drones for commercial applications. Due to Insights industrial drones (non-delivery) raised their popularity and assumed flexibility, supply at least 27 deals – what CB Insights says is the chain businesses have begun to consider largest number of deals among the enterprise using drones in warehouses. In fact, a Frost robotics categories. and Sullivan report states that drones are one of the few radical technologies that industry Healthcare is a hot robotics sector participants will cautiously adopt over the next 15 years. Last-mile delivery drones have come In 2016, while major advances and investment in favor, which is exemplified by Zipline, which were made in the areas of logistics and is backed by Google Ventures and Sequoia service robots, healthcare robotics also made Capital, and Dispatch, which is backed by headway. Although the medical robotics sector Andreessen Horowitz. saw fewer deals compared with consumer and enterprise robots, there were some well-funded There’s a better understanding of the rounds, said CB Insights’ Varadharajan. opportunity presented by robotics today than in previous years, said Sam Korus, an analyst Restoration Robotics raised $45 million in at ARK Invest and an expert in industrial Series D the first quarter, and Auris Surgical innovation. Robots raised $49 million in growth equity in the third quarter. The robotics industry has “People are beginning to recognize that gained traction in most end-user segments easily reprogrammable robots can enter new over the past four years, noted Bharath markets and make a needle-moving difference Kanniappan, a senior industry analyst at for companies,” he said. “It is still at an early research and advisory firm Technavio. This stage, but more and more case studies are is mainly the result of increased automation emerging proving the value proposition.” requirements to optimize workflow, increased data interpretation, and analysis, and Dominance in the consumer drones category adherence to quality schedules. by established businesses such as DJI may make it harder for newer startups to break into “Entry of new market participants both in the the market, warned Deepashri Varadharajan, a product-development and software solution tech industry analyst at CB Insights. However, streams has paved way for venture capitalists a reduction in consumer demand coupled [VCs] to focus on extending their support in with lower prices has moved start-ups and terms of capital and series funding,” Kanniapan established drone manufacturers to shift said. “Apart from funding these start-ups, the their focus from consumer use to specialized VCs are also in focus to generate maximum commercial applications. [returns] out of the patents produced by these robotics companies. These types of Competition in the drone market is intense funding are mainly witnessed in the healthcare and has challenged many drone sector in the U.S., due to the high acceptance manufacturers, such as 3D Robotics which in ratio of rehabilitation and assistive robots October said it would stop developing by the patients and healthcare institutes in hardware and move into software for other comparison with other regions.” drone makers -- despite raising nearly $100 million in equity. According to an October 2016 Kanniappan stated he expects to see more Forbes article, 3D Robotics laid off more than deals going to startups outside the U.S. over 150 people, burned through almost $100 the next 12 to 24 months. million in venture capital funding and completely changed its business strategy. In November, the company changed its position and unveiled a commercial strategy, announcing a camera-equipped drone with

RoboticsBusinessReview.com 5 Cobots, companions capture interest According to Dan Kara, ABI research analyst, there is a progression to move beyond the Collaborative robots continue to show general framework of IOT / IIOT, which is increased adoption and continue to be on the based on using connected devices with upswing as an “exciting area” for investors. general, passive sensors to monitor and “For traditional industrial robots, the setup optimize systems and reach what he refers can account for approximately a third of the to as the Industrial Robotics of Things (IORT). cost, which includes an expert programming In the framework of IORT, devices tie sensor the robot to do a single task in high volume,” data from a variety of sources and leverage AI said ARK Invest’s Korus. “Collaborative robots to decide the best course of action, and then appear to be expanding the market by requiring engage to control or manipulate objects in the less upfront capital and by being easily trained physical world. In some cases, this occurs as to do different tasks.” the device moves through the physical world. An example of this movement towards IORT Due to improvements in machine vision, IoT can be observed through the partnership and plug-n-play features, greater interest in announced in April 2016, when FANUC the adoption of robotics is occurring amongst collaborated with Cisco, Rockwell Automation, SMEs. Business strategies such as Robotics- and PFN on its FANUC Intelligent Edge Link as-a-Service offerings, which is enabling and Drive (FIELD) system. organizations to rapidly scale up or down their use of robotics as needed, in a pay-as-you-go ARK’s research indicates that deep learning subscription or robots for hire at an hourly rate. could grow the robotics market by an order This certainly is taking the pressure off the end of magnitude, according to said Sam Korus, user’s bottom line and aiding in SME adoption. an analyst at ARK Invest and an expert in In addition, hardware and enabling software industrial innovation. “Between 2015 and 2016, are projected to drop by many analysts to drop the winning robot’s performance in Amazon’s more than 20% over the next decade. Picking Challenge more than tripled from 30 to 100 items per hour. If that rate of improvement Investors are also looking at advances in continues, robots could surpass humans in , voice-based interactions, picking more items per hour within two years.” and home robots, said Varadharajan. “There was an increase in investment activity to social ARK Invest predicts that by 2035, real GDP robots - consumer-focused companion robots will be 42% higher with automation than - as well as educational robots that teach without it. The firm’s researchers also found children how to code.” that the “capability per unit cost” of robots is increasing, which means that the cost of Post-Alexa, CB Insights’ Varadharajan believes robotics hardware is decreasing, and robotics there could be increased investor interest in software is making robots more useful across voice-enabled home robots. She cited Rokid a wide range of applications. Inc. as an example of investment interest in this area. The company uses deep learning E-commerce and voice recognition and recently raised $50 The continued growth of E-commerce million. operations and solutions has boosted And in education, Wonder Workshop raised activity in the development of warehouse $20M from investors like CRV and the Harper logistics robotics. Logistics startups offering Group. warehouse automation benefitted from an aggressive spike in funding in 2015, after Deep learning and automation for GDP seeing virtually no activity in prior years. In 2015, funding spiked to 9% of that year’s Advancements in deep learning and $1.256 billion total, according to Lux Research robotics are of particular interest to analyst Kyle Landry. investors, especially as the industry edges toward devices having real-time intelligence When Amazon plunked down $775 million and the ability to immediately act upon in 2012 to acquire Kiva Systems, it was the information, calculations, and logic. start of an investor frenzy as E-commerce logistic robots came into focus. The increase

RoboticsBusinessReview.com 6 investments in logistics startups are providing according to a recent report by eMarketer, the needed capital for many startups to which tracks retail sales. The research also commercialize robotics solutions that can forecast that global retail sales will top $27 keep pace with the demands of a rapidly trillion in 2020, with e-commerce representing growing industry. $4.058 (14.6%) of the forecasted total. What makes warehouse logistics even more so is Now with the logistics robot market in full that majority of warehouse logistics tasks are swing, it’s interesting to note that startups still primarily accomplished through manual in this area are aggressively splitting into labor. According to a study by the McKinsey two camps — those building warehouse Global Institute, as much as 45% of activities automation to replace human workers, and individuals across multiple vertical markets are those building solutions to assist human paid to perform can be automated. workers. Currently, companies focused on developing solutions that help humans are taking a lead INVESTMENTS position and will continue to find success in Funds & ETFs near-term warehouse strategies, according to Despite the upsurge of investments into Landry. Companies developing and offering robotics, publically traded companies took logistics automation to replace human investors on a bit of a rollercoaster ride in workers are facing significant performance 2016. However, the ROBO Global Robotics and adoption hurdles, he added. These include & Automation Index ETF (NASDAQ: ROBO) challenges around perception and navigation, managed to advance an astounding +18.9% for dexterous grasping and manipulation, 2016, outperforming the S&P 500 and ACWI by and dynamic decision-making in complex 7% and 10%, respectively. Interestingly, from environments. the depths of despair in February, the ROBO For startups and established robotics solution Global Index rallied +38% into the year-end providers, this area remains strong as it is close of 2016 reflecting an under-exposure estimated that in 2016, the total retail sales to the asset class and superior growth across the globe were expected to come in at prospects. During 2016, ROBO Index returns an estimated $22.049 trillion, up 6% from the for all 13 subsectors and 15 geographies were previous year, with e-commerce representing positive. The best performing subsectors were an estimated $1.915 trillion (8.7%) of the total, Logistics Automation and Agriculture, up 42% and 33%, respectively.

ROBO Stox performance, 2016

RoboticsBusinessReview.com 7 BOTZ ETF performance

Launched in October of 2013, the ROBO Global in emerging technologies. The robotics ETF is measures the performance of robotics-related listed under the ticker -BOTZ. and/or automation-related public companies. The index is comprised of companies in New York-based Global X manages 55 ETFs the rapidly developing global robotics and and said it offers investment ideas and funds automation industry, with operations in over organized around coming macroeconomic 15 different countries and listings on multiple shifts rather than traditional vertical industries. foreign and domestic exchanges. The fund Global X has 29 holdings in its BOTZ ETF. is inclined toward heavy machinery (25%) Industrial Machinery takes up the first and electronic components (23%). In terms spot with about 30% exposure followed by of country exposure, the fund mostly invests Electronic Equipment & Instruments (11.6%) in companies from the U.S. (43%) and Japan and Health Care Equipment (11.24%). (23%). Geographically, Japan takes the top spot with about 46% weight while the U.S. (20.36%) and Bob Keivan, a trader with multinational Switzerland (10.48%) also get a double-digit proprietary market making firm Optiver, allocation. referred to ROBO Global as a good way for investors to gain exposure to the robotics As a side note, in January 2017, the AXA space. World Funds Framlington Robotech fund was announced. The fund is managed by AXA IM’s “(Robo Global) is definitely diversified in that Tom Riley and Jeremy Gleeson in the AXA IM all sectors of robotics companies are included. Framlington Equities team. Furthermore, it’s run by State Street, which in my opinion is the industry leader in the ETF Crowdfunding continues despite space. I recommend ETFs as they are the best stumbles vehicle to invest in a sector.” Keivan added As CB Insight’s Varadharajan pointed out, that as long as the investment is under $10 some well-funded startups, especially those million or so, the investor should not run into around social robots and drones, have opted liquidity issues. “So for an investment, I would for crowdfunding in their initial stages of recommend it.” fundraising. For example, UBTech ran an Last year, Global X Funds brought a new Indiegogo campaign and raised $1.4 million exchange-traded fund (ETF) to market to for its Alpha 2 humanoid robot. The provide investors an opportunity to participate educational robot maker is now valued at $1 billion.

RoboticsBusinessReview.com 8 Meanwhile, in the drone sector, China-based In practical terms, Lim said scattered Ehang, developer of the first passenger drone investment trends can be taken as an indicator and humanitarian drone solution provider, that “there will be no merger-and-acquisition California-based Zipline International, were boom in the next few years.” crowdfunded, and both have raised over $40 million in equity since. “Everyone in the robotics market is into the hype, but no one knows what to do with it,” she Global Picture said, adding that would-be “bidders don’t know where to focus yet.” Investments in robotics have been increasing steadily at a 17% annual rate in the U.S. In Obviously, some deals are being signed, but 2015 alone, venture capital funding for robotics it’s limited mostly to the biggest firms. “It’s stood at $922 million, about three times the a market-share grab for those companies,” amount raised in 2014. In terms of funding, according to Lim. “They’re buying even if they three of top deals in 2016 were aimed at don’t know exactly how to scale up [acquired humanoid robot maker UBTech ($100 million technologies] or add value.” Series B), social robot firm Robo ($100 million Series A), and educational robot company Anki As adoption continues to vary by industry and ($52.5 million Series D). economy with developments and investments extending beyond legacy manufacturing, Overall, 2016 delivered a significant increase the commercial robotics market continues in the number of deals to robotics startups to experience increased fragmentation. This and a rise in the number of enterprise deals, is neither good nor bad as a fragmented explained CB Insights Varadharajan. By market tends to be a roust one, and the her count there were 173 deals to robotics robotics market is certainly that. But there is startups in 2016, up from 146 in 2015 no clear market leader defining the direction [excluding driverless cars and startups of the industry and there is no clear definable focused exclusively on robotics and drone investment trend to point to when evaluating software]”There was a 26% increase in deals 2016 financial results. This simply makes to the enterprise robotics sector, which was the investment decision more challenging a major contributor to the overall equity deal and possibly prohibitive at this time for many growth to robotics startups in 2016.” would-be investors and buyers. In Asia, robotics investments exceeded $1 End-user interactions are key billion, with countries like Japan and China significantly increasing their funding of Original equipment manufacturers (OEMs) robotics. are currently “front runners” in the investment space, said Bharath Kanniappan, a senior This year, 43% of startup deal share was industry analyst at Technavio. This is mainly outside the US according to CB Insights. Based because of their “continuous and direct on their reporting, 6% of global deal share went interaction with educational and research to startups in France, and 5% went to India, institutes” alongside regular monitoring of while UK-based startups accounted for over service and requirement related queries from 4% of the deals. end-user segments, he said. Robotics investments scattered “These interactions between the suppliers, research institutes, and end users have gained While investors seemingly are becoming more major breakthroughs in the product designing active in placing their bets on robot solutions, and development activities,” he said. Elizabeth Lim, Americas research editor at the Mergermarket Group said she see no real In terms of global research and development, investment trend to point to at the moment. which are currently dominated by investments from OEMs, Technavio forecasts that the “There are so many different kinds of market will reach $4.5 billion by 2020, with manufacturers and so many different kinds close to 40 % governed by third-party funding of [robotics] buyers, and the technologies are entities. still forming,” Lim said. Mergermarket tracks business combinations and analyzes deals.

RoboticsBusinessReview.com 9 “These entities are extending their investments direct investments in 2016, RBR documented mainly in the areas of healthcare and logistics, 56 direct investment transactions occurring in where the maximum revenue realization is Q4 of the year. expected to happen during the next four years,” explained Kanniappan. Globally, overall Q4 2016 deal volume (direct investments, M&A, funding, IPO) as measured Q4 Transactions by total RBR recorded deal value was over $60.8 billion, compared to Q4 2015 at $1 The series of transactions in Q4 2016 billion. truly symbolizes the strong momentum of financial flurry that occurred around robotics Overall Q4 2016 direct investments as in 2016, as well as the increased attention measured by total RBR recorded vale was and investments toward consumer- facing $1.3 billion, compared to $256 million in Q4 applications. This is a trend RBR first noted 2015. The overall average RBR recorded direct in its Q4 2015 report. Retail customer investment deal value in Q4 2016 was 136% service, healthcare (physical and mental), higher at $40 million than the $17 million transportation (auto) showed the strongest reached in Q4 2015. traction. Overall Q4 2016 M&A value as measured by Of the reported 50 M&A deals that occurred in total RBR recorded deal value was $58 billion, 2016, RBR documented 21 occurring in Q4. Of compared to $756 million in Q4 2015. the 110 plus companies that were recipients of

$1B+ Investments, Mergers, and Acquisitions Totaled $105B in 2016

MOVER TARGET TOTAL TYPE ANNOUNCED UK Trade & Investment Science Innovation Network Undisclosd investment 10/3/16 Japan Rockwell Automation Maverick Technologies Undisclosd M&A 10/3/16 FLIR Systems Point Grey Research 253,000,000.00 M&A 10/3/16 iNovia Capital, GE Ventures, Caterpillar Ventures Clearpath Robotics 30,000,000.00 investment 10/5/16 Razer Inc. 30,000,000.00 investment 10/5/16 Electronics Viv Labs Undisclosd M&A 10/5/16 Thinci Denso Undisclosd investment 10/6/16 Seedrs Initiative Moley Robotics 1,100,000.00 investment 10/6/16 Delair-Tech Gatewing 14,500,000.00 M&A 10/10/16 Keolis, Valeo and Group8 (Qatar), Rebolution Capital Navya 34,000,000.00 investment 10/11/16 NextView Ventures, FirstMark Capital Optimus Ride 5,250,000.00 investment 10/11/16 South Korea 450,000,000.00 investment 10/11/16 Visionnaire Ventures Modbot 4,000,000.00 investment 10/12/16 SoftBank Zymergen 130,000,000.00 investment 10/12/16 Enrico Krog Iversen, Thomas Visti and The Danish OnRobot 1,000,000.00 investment 10/13/16 Growth Fund. Day One Capital, Finext OptoForce Undisclosd investment 10/14/16 Saudi Arabia SoftBank 0.00 investment 10/14/16 Leeport Holdings, Guangdong Greatooo Molds OPS-Ingersoll Undisclosd investment 10/15/16 Qualcomm Inc. University of Pennsylvania Undisclosd investment 10/17/16 Recruit Holdings Savioke Undisclosd investment 10/18/16 Frontt Capital Management Ltd. University of Michigan 27,000,000.00 investment 10/18/16 Daphni 165,000,000.00 investment 10/18/16 Bessemer Venture Partners Oryx Vision 17,000,000.00 investment 10/19/16

RoboticsBusinessReview.com 10 MOVER TARGET TOTAL TYPE ANNOUNCED GGV CApital, ZhenFund Vincross 6,000,000.00 investment 10/19/16 Lux Capital Hangar Technology 6,500,000.00 investment 10/20/16 Demon Drillers 146,000.00 investment 10/20/16 Atlassian 460,000,000.00 IPO 10/20/16 Intel Capital Chronocam, InContext Solu- 30,200,000.00 investment 10/25/16 tions Intel Capital Perrone Robotics Inc. Undisclosd investment 10/25/16 Philips Lighting, ABB PointGrab 7,000,000.00 investment 10/25/16 IDG Capital Partners, Walden International Rokid Inc. 65,000,000.00 investment 10/25/16 Intel Capital Embodied Undisclosd investment 10/26/16 Qualcomm Inc. NXP Semiconductor 0.00 M&A 10/26/16 Slush Marvelmind Robotics 740,000.00 investment 10/31/16 Acutronic Group Erle Robotics Undisclosd M&A 10/31/16 General Catalyst and others Sunflower Labs 2,100,000.00 investment 11/4/16 Fusion for Energy 110,000,000.00 European 11/5/16 partnership K&L Gates LLP Carnegie Mellon University 10,000,000.00 research gift 11/7/16 True Ventures Tend.ai 2,000,000.00 investment 11/8/16 Composite Capital Management Zoox 50,000,000.00 investment 11/8/16 Grohmann Engineering Tesla Motors Undisclosd M&A 11/8/16 Visionaire Ventures and Andreessen Horowitz, Jerry Zipline International Inc. 25,000,000.00 investment 11/9/16 Wang, Sequoia Capital and Subtraction Capital Jibo 13,100,000.00 investment 11/11/16 Panasonic Corp., Daiwa House Industry Co., and SBI Seven Dreamers Laboratories 60,000,000.00 investment 11/14/16 Investment Co. Impact Venture Capital Nightingale Security Undisclosd investment 11/15/16 Hangar Autoflight Logic Undisclosd M&A 11/16/16 Practica Capital Rubedo Sistemos 528,675.00 investment 11/17/16 TriPoint Global Equities Myomo Inc. 50,000,000.00 IPO 11/21/16 Sales On Demand iRobot Undisclosd M&A 11/21/16 South Holland RoboValley 318,000.00 grant 11/22/16 Global Brain, Mitsui Fudosan, Koden Holdings, Mizuho Life Robotics 9,000,000.00 investment 11/22/16 Capital and Golden Asia Fund. Sustainable Dev Tech Canada Farmer’s Edge 18,300,000.00 investment 11/24/16 Renmin Group, Duoniu Media, Lanhai Ark and Hanjing SimToo 13,600,000.00 investment 11/25/16 Family Offices Indus- M&A 11/25/16 triees RoboRobo Shengtong Printing 62,000,000.00 M&A 11/26/16 4FO Ventures, Investiere.ch EcoRobotics 2,970,000.00 investment 11/28/16 Shandong Province, Luxin Group WI Harper Group Undisclosd investment 11/28/16 AI-Robotics 1,800,000.00 investment 11/29/16 (seed) Asimov Ventures Undisclosd investment 11/29/16 Robot Technologies/Systems Australia Diverseco Undisclosd M&A 11/29/16 Prox Dynamics FLIR Systems 134,000,000.00 M&A 11/30/16 Zano Jorgensen Engineering 35,000,000.00 M&A 12/1/16 Exotec 3,500,000.00 investment 12/2/16

RoboticsBusinessReview.com 11 MOVER TARGET TOTAL TYPE ANNOUNCED Investment Bank of the State of Brandenburg, KOELBE Kinematics 2,600,000.00 investment 12/2/16 Unternehmensbeteiligungen GmbH Xolvr Next Education Undisclosd M&A 12/2/16 Uber Geometric Intelligence Inc. Undisclosd M&A 12/5/16 USDA National Institute of Food and Agriculture 3,000,000.00 grant 12/6/16 RTA Diversico Undisclosd M&A 12/6/16 Liquid Robotics The Boeing Co. 300,000,000.00 M&A 12/7/16 Hunter Hall Investment Fastbrick 8,000,000.00 investment 12/9/16 Next Frontier Capital, Millennium Technology Value Blackmore Sensors and 3,500,000.00 investment 12/12/16 Partners Analytics National Science Foundation Harvest CROO 1,000,000.00 investment 12/12/16 BC Tech Fund, BDC Capital, Relay Ventures Mojio 15,000,000.00 investment 12/12/16 Teledyne Technologies Inc. E2V Technologies PLC 780,000,000.00 M&A 12/12/16 SoftBank Apple 0.00 investment 12/13/16 Google/Alphabet Waymo Undisclosd spinoff 12/13/16 Henry Ford College 6,000,000.00 investment 12/15/16 Sapphire Capital Partners High Growth Robotics Ltd. 2,200,000.00 investment 12/16/16 Philips Lighting, ABB PointGrab 7,000,000.00 investment 12/16/16 U.S. Department of Agriculture 3,000,000.00 investment 12/16/16 Advanced Integration Technology KUKA Aero Undisclosd M&A 12/18/16 Global Brain SuperFlex 9,600,000.00 investment 12/20/16 TDK Corp. InvenSense Inc. M&A 12/21/16 Coppelia Robotics GmbH Blue Workforce A/S Undisclosd M&A 12/28/16 BlueRun AI Robotics 28,500,000.00 investment Q4 Reported (Series A) Shenzhen GoWild Robotics 15,000,000.00 investment Q4 Reported Andreessen, Accel Skydio 25,000,000.00 investment Q4 Reported

RoboticsBusinessReview.com 12 The Big Deals of 2016: An ambitious Electronics firms look forward to IoT, industry connected cars SoftBank Group’s October 2016 launch of Chips also figured in the year’s second- its $100 billion Vision Fund for technology largest acquisition -- the proposed $47 billion investments accounted for about half of purchase of NXP Semiconductor by wireless- 2016’s 13 largest corporate-financing pledges technology giant Qualcomm Inc., announced and commitments. in October. Qualcomm executives said the buyout addressed a technology expected to We are defining the largest deals as those with benefit from current trends: connectivity. It is a disclosed (not necessarily final) value of $1 estimated the combined companies will have billion or more. annual sales of about $35 billion. SoftBank has promised to put up to $25 billion Qualcomm CEO Steve Mollenkopf said in over five years in the fund, which is intended a recent conference call that in automotive to accelerate development of automation, Qualcomm “will lead across multiple verticals the Internet of Things (IoT), and other at scale combining our expertise in computing technologies. The Public Investment Fund and multimedia with NXP’s leadership and of the Kingdom of Saudi Arabia promised to the complete car infotainment system, secure put in $45 billion over the same period. (And car access, body and in-vehicle network, and days into 2017, Apple Inc. pledged another $1 safety.” He went on to say that the growth of billion.) semiconductor content in cars is expected “to

Combining SoftBank’s fund pledge with outpace the rate of vehicle production growth its $32 billion buyout of chipmaker ARM itself.” Ltd., announced in July, puts the Japanese telecommunications company in the top slot NXP’s product development focuses on in its own right. SoftBank coveted ARM for providing the chip infrastructure for the its early expertise in IoT microprocessors, coming Internet of Things -- things including but the British chipmaker is also involved in connected robotics, vehicles, appliances, and automation-related products. manufacturing equipment.

RoboticsBusinessReview.com 13 Samsung questions and instructions to electronic It should not be surprising that the next- products. It reduces the need to speak in biggest acquisition centered on connectivity, awkward and stilted sentences or to type the too. Samsung Electronics bought Harman input. International Industries for $8 billion. Buyers of Viv’s product plug their products Harman is a familiar name to audiophiles. into the open (as opposed to proprietary) Among other things, it makes high-end platform, eliminating the need for them to write consumer audio and video systems. But far their own voice-interaction code. This saves more profit lies in Harman’s vehicle telematics, companies development time and expense. connected vehicle, and wireless security Viv, which by October had gained over $30 products, all of which will be foundational million in funding, is co-founded by three elements of autonomous cars. former Apple software engineers -- Adam In announcing the deal in November, Samsung Cheyer, Dag Kittlaus, and Chris Brigham -- who executives said they expected the automotive launched , which was purchased by Apple electronics market to top $100 billion by 2025. in 2010. The three departed Apple shortly Samsung expects to gain entry to the many after the acquisition to start Viv Labs. Neither vehicle makers that today buy from Harman company has disclosed what Viv’s price was. for their higher-end models. The combined entity is hoped to create an end-to-end Global powerhouse court controversy product platform, shutting out myriad smaller Among 2016’s top deals, only one generated competitors. significant controversy. Samsung plugs into Viv’ China-based appliance maker Midea Group interface: Co. offered $5.2 billion in cash last May for Germany’s storied robotics maker, KUKA AG. Also last fall, Samsung said it would buy Viv The worry was that core technology developed Labs Inc., which makes software that enables indigenously was being uprooted to China. people to speak detailed, natural-language

2019: 40% of the global supply will go to China

RoboticsBusinessReview.com 14 While those opposed to the deal, including at beams of electrons in a vacuum and at least one trade union, tried unsuccessfully to high temperatures to print metal objects scuttle the acquisition or to find a local buyer, faster and using more materials than can be the German government examined the deal. accomplished competing technologies. And Ultimately, regulators decided not to order a the resulting objects are better than what can probe, saying that a sale would not harm the be achieved with metal casting. nation. SLM Solutions makes selective laser melting According to a report by the South China systems to fashion objects out of materials Morning Post, Midea immediately began including aluminum, stainless steel, nickel- building a $1.5 billion factory in China to churn based alloys, and titanium. Its printers are used out new robots. Its capacity initially will be today to make titanium implants for medical 7,000 machines annually, but Midea executives use. say the plant will make 17,000 robots by 2025. Foxconn and Sharp do acquisition Analyst firm Tractica predicts sales of dance industrial robots in the Asia-Pacific region, primarily driven by demand from China, will One of the year’s more unusual acquisition reach $15 billion by 2021. developments was a $3.8 billion acquisition involving the world’s largest contract GE brings 3D to life electronics manufacturer, Taiwan-based Foxconn Technology Group, and Sharp Corp., Also of note was General Electric Corp.’s a fading Japan-based consumer electronics double-fisted 3D printing buyouts in maker. September. The global manufacturing conglomerate had already invested $1.5 billion Foxconn, which bought Sharp, has made in printing when it bought industry leaders its fortune assembling Apple’s phones and Arcam AB and SLM Solutions Group AG for a tablets. Foxconn executives have committed combined $1.4 billion. to replacing 1 million workers with robots in the next couple of years. To date, it has given GE’s interest in additive manufacturing has pink slips to 60,000 employees, thanks to surged from quick prototyping to making parts automation. for use in jet engines. In September, company executives said that their aviation unit, GE Sharp’s lure was its highly regarded organic Aviation, has designed hundreds of engine light-emitting-diode (OLED) technology used parts in ways that were impossible before 3D in Apple iPad screens. It also has a number printing. of robotic initiatives including autonomous vacuum cleaners, security, and surveillance In fact, the company claims to have cut 845 systems. Another appealing aspect for parts for its advanced turboprop engine. Foxconn was Sharp’s pool of innovators in Combining parts saves weight (including that OLED and LCD. of part connectors and fasteners) and reduces assembly and maintenance complexity, and, Foxconn originally had bid $5.5 billion for thus cost. Sharp, and everything was going well until hours before the contracts were to be signed in Where necessary, printed parts can be created February, Sharp executives reportedly told the in ways that are much stronger than joined buyer that it might be liable for about $3 billion components. The computing infrastructure in potential liabilities as part of the sale. required for designing and building part is radically smaller than that for introducing parts Many tense meetings later, the buyout price using conventional manufacturing. was $3.8 billion, a significant let-down for Sharp shareholders, no doubt, but still better Little wonder, then, that GE surprised the than the next-highest bid, $2.6 billion, offered industry by acquiring Arcam and SLM by the Innovation Network Corp. of Japan, a Solutions. Arcam has proprietary electron government-backed investment fund. beam melting (EBM) technology. EBM uses

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