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But first, each of the companies targeted by SoftBank is heavily involved in robotics or is swinging deliberately toward greater involvement in automation. The six companies are: › Didi Chuxing, the so-called Uber of China, which is investing in artificial intelligence for use in driverless vehicles › Improbable Worlds Ltd., a London software firm whose operating system can be used to create highly detailed simulations for games › Nvidia Corp., a graphics chipmaker with ambitions to build and rent out cloud-based, enterprise-scale artificial intelligence services running on its own market-dominating AI chips › Boston Dynamics and Schaft, makers of quadruped and biped robots, respectively, bought from Google parent Alphabet Inc. › Cybereason Inc., a digital security company with a bot that searches for anomalies that indicate attacks on a data network Let’s break out some details: In April, SoftBank invested $5 billion in Didi Chuxing. Besides being China’s dominant transportation-as-a-service company, Didi Chuxing in March opened an AI research center in Mountain View, Calif., that is vacuuming up coders in Robotics Trends roboticsbusinessreview.com 3 Robotics Trends TRANSACTIONS REPORT 2017 SECOND QUARTER Silicon Valley. Executives’ enthusiasm for opportunities in car-hailing startups is just as great. They have invested in numerous firms around the world. In May, SoftBank and venture firms Andreessen Horowitz and Horizons Ventures sank $502 million into Improbable Worlds. The startup makes a platform called SpatialOS into which third-party developers can plug their simulation-related apps. Alphabet makes a competing platform called Google VR. Also in May, SoftBank reportedly spent $4 billion on Nvidia. Beyond its plans to offer AI cloud services, Nvidia has also said it is working with automotive parts supplier Robert Bosch GmbH to create a Bosch-branded self-driving car computer. It also revealed its collaboration with truck maker Paccar Inc. to create autonomous truck components. In June, SoftBank added to the odd travails of robotics startups Boston Dynamics and Schaft. The pair was part of a robot shopping spree by Google Inc. three years ago. But culture clashes and a lack of immediate commercial SoftBank has added robotics investments to its acquisition of Aldebaran’s Pepper. Robotics Trends roboticsbusinessreview.com 4 Robotics Trends TRANSACTIONS REPORT 2017 SECOND QUARTER success caused Google/Alphabet to change its mind, and Boston Dynamics and Schaft were put on the market. A robotics-crazed culture in Japan may have swayed SoftBank executives to cut a check for an as-yet undisclosed price (see more below). Both acquisitions could help SoftBank make machines that are more agile than its Pepper service robot. Late in June, SoftBank made its last automation-related, external investment of the quarter. It pumped $100 million into cybersecurity firm Cybereason, which makes a “hunting engine” that looks for out-of-the-ordinary digital behavior. Its software can also block, contain, and eradicate threats. SOFTBANK AIMS TO BE NO. 1 IN ROBOTICS If that list of second-quarter investments somehow doesn’t sound impressive or indicate a trend, consider the following: › Back in 2012, SoftBank bought 95% of France-based Aldebaran Robotics, creator of Pepper, for $100 million and a commitment to spend up to $50 million beyond that to goose product development. › In December 2016, SoftBank put $1 billion into OneWeb Ltd. The communications startup wants to build a satellite-based network that could deliver gigabit-per-second Internet access globally. This presumably would benefit SoftBank’s primary telecommunications business, but would also make managing and operating robots cheaper and easier › Last July, SoftBank bought ARM Holdings. The low-power-chip designer’s creations are expected to be enablers for the commonplace use of robotics and the Internet of Things. SoftBank is selling a 25% stake to its Vision Fund. › In July 2017, SoftBank’s Vision Fund venture capital offshoot participated with others in funding automation-heavy indoor farming startup Plenty ($200 million), driverless-car software developer Nauto ($159 million), and robotics AI coder Brain Corp. ($114 million). Robotics Trends roboticsbusinessreview.com 5 Robotics Trends TRANSACTIONS REPORT 2017 SECOND QUARTER ABB MAKES ITS OWN MOVES The other big corporate mover of the quarter was ABB. The difference between the Swiss giant of industrial automation and Softbank in this case is scale and scope. ABB participated in just three investments, and all were well within its wheelhouse. Its biggest placement came in April, when ABB shelled out $2 billion for Bernecker & Rainer Industrustie Elektronik, an Austrian maker of factory- automation components. Assuming that price is correct, that is ABB’s largest acquisition in perhaps five years. ABB Technology Ventures, a strategic fund, participated in May with several other corporate investors, placing $7.6 million in Bonsai AI Inc. Among the other investors were Microsoft Ventures, New Enterprise Associates, Samsung NEXT, and Siemens. Finally, ABB bought the industrial communications unit of Germany-based Keymile Group for an undisclosed sum. Keymile’s hardened digital-network systems would be fundamental to reliably operating robotics and other systems on the Internet of Things. AUTOMATION IPOS POP UP The quarter also surprised in terms of venture-backed initial public offerings. Granted, pure-play automation companies remain disconcertingly few. But the corral gets more crowded when you look at companies whose business model mandates the adoption of automation in their manufacturing process and/or the inclusion of automation in products and services. Meal-kit maker Blue Apron Holdings Inc. led this category. Its IPO netted $300 million (which disappointed the markets and led to the ouster of COO and co- Robotics Trends roboticsbusinessreview.com 6 Robotics Trends TRANSACTIONS REPORT 2017 SECOND QUARTER founder Matt Wadiak). Blue Apron is — perhaps too late — running as fast as it can from its manual ways and toward logistics automation. Amazon is moving into this niche. Cloudera Inc., a cloud-computing services firm, completed its $225 million IPO in April. The company has integrated its DataRobot, a machine-learning platform into its data-management and -analysis services. Enterprise-security firm Okta Inc.raised $187 million in its April debut. The company uses a high level of automation to speed the building, testing and release of new and updated digital apps. A short but nonetheless blue-blood list of corporate venture funds pumped $102 million into Canadian artificial-intelligence firm Element AI. Microsoft Ventures, Intel Corp. and Nvidia Corp. The round, which closed in June, was led by venture firm Data Collective, which also participated in the Plenty investment highlighted above. AI pioneer Yoshua Bengio is a cofounder of Element, which creates large- scale AI projects for big corporations. Its software is more or less customized for clients, meaning that Bengio and crew are selling AI as a service. This means that Element competes with Amazon, Google and other deep-pocketed AI-service players. Executives have said their value-add is that AI services is all that they do, as opposed to, say, Google, which is involved in so many sectors that it’s starting to resemble a software version of humongous Asian industrial combines. Appian Corp., maker of a business-process-management platform, scored $75 million in its May IPO. It recently introduced a robotics-process-automation (RPA) product. RPA is relatively new. It essentially seeks to create co-botting in the back office. Robotics Trends roboticsbusinessreview.com 7 Robotics Trends TRANSACTIONS REPORT 2017 SECOND QUARTER Across the Atlantic, online fashion retailer Boohoo.com Plc. sold 22.7 million new shares to institutional investors. The sale, conducted in June, raised $65 million to be