Boston Robotics Firms, While Making Strides, Could Lose Their Edge to Google and the Valley
None of this would have happened 10 years ago. Where to begin?
Last month, I walked into a room of about a dozen robotics experts and technology startup investors. It was one of the sessions at the MassTLC Innovation “unConference” in Boston. The discussion centered around how to build a successful robotics company. But it was some of the newer context around this question that turned the session into a watershed moment I won’t soon forget.
Two main takeaways: First, robotics companies around Boston have come a very long way since 2000, when I was a postdoc in a robotics group at the MIT Artificial Intelligence Lab. That sort of academic research is still going strong, but the bigger story of the past decade has been the business success of robotic vacuum cleaners, bomb-disposal units, and surveillance drones, and how that has helped pave the way for a new generation of companies.
My second takeaway is that the business community thinks there is a new threat to Boston’s competitive position in robotics—and its name is Google. I’m not usually one to fan the flames of Boston vs. Silicon Valley arguments, but in this case the discussion hits close to home, so I wanted to see if there’s much truth to it.
The Boston area, of course, is home to numerous robotics companies—iRobot (NASDAQ: IRBT), Boston Dynamics, Harvest Automation, Heartland Robotics, Kiva Systems, iWalk, and CyPhy Works, just to name a few. Many of those companies were represented in the unConference session, along with investors from CommonAngels, Founder Collective, and General Catalyst. Historically the region has had lots of expertise, both in universities and industry, in key technologies underlying robotics such as sensors, actuators, control algorithms, artificial intelligence, computer vision, and data storage.
Yet 10 years ago, most early-stage investors (angels and VCs) wouldn’t think of touching a robotics startup. The development costs and business risks were too high, and the technology infrastructure—onboard processing power, wireless communication, programmable chips, sensors, algorithms—wasn’t quite ready for prime time. Now things have changed, certainly in investors’ minds, in terms of robots hitting the commercial mainstream. “We’re not quite there yet, but we’re getting really close,” says James Geshwiler, a managing director of Lexington, MA-based CommonAngels, who helped organize the session. (Geshwiler adds that his group is actively looking to make a seed-stage investment in robotics.)
Across the industry, selling robots has evolved to be more about the specific markets they could serve rather than about robots per se. And with that repositioning, VCs seem more hopeful than ever that big investments in robotics will pay off in terms of growth and exits. “We will see innovation from capital-intensive companies, led by people who own equity,” said Eric Paley, a managing partner at Founder Collective, an early-stage venture firm that recently participated in a $5.3 million financing round for Harvest Automation, a Billerica, MA-based agricultural robotics startup. “Twenty years from now, in Boston, this could be a real innovation space.”
Now, about that Google threat. Earlier last month, the Mountain View, CA-based Internet search giant (NASDAQ: GOOG) made a big splash with a New York Times article about its robotic car that can drive itself through traffic using a combination of position and motion sensors, GPS, mapping and radar technologies, computer vision, and smart software. My first reaction was that it was a lot of hype. An autonomous car like that might work well enough in Silicon Valley traffic (with a driver ready to take control if there’s a problem), but I wouldn’t bet on it surviving a day on the chaotic streets of Boston.
Turns out I was wrong. Boston robotics executives and investors in that conference room last month (and since then) had strong reactions to the Google car and what it means for the field. Carl Calabria, a senior vice president at Bedford, MA-based iRobot, said the project is “Google’s play to own the [operating system] for automation.” That technology, coupled with mapping and location-based services, could prove to be a potent combination.
“Autonomy and location are key,” Geshwiler says. “Google, in long efforts with autonomous cars, turns out to have lots of applicability to things we wouldn’t imagine, if we were limiting our thinking to cars. When you work out the bugs in that system, there’s a cascade of other things” that will come from mastering “where you are at every given point in time, and what’s around you.”
Tom Ryden, co-founder of the telepresence firm Vgo Communications (and co-chair of the MassTLC robotics cluster), was more blunt. “The Google car is a threat,” he said. “Autonomy is really what allows these robots to do what you want them to do.” He added that Boston companies and technologists need to work to “keep that [expertise] here.” Others I’ve talked to since then also shared his sentiment.
Google, for its part, is trying to advance the state of the art—and see where it might lead in terms of a business. The company did not respond to requests for comment on the car project. It’s no coincidence that Google has ramped up its efforts in automation at the same time as robotics companies in Boston (and elsewhere) are starting to see more investment. Better, cheaper technologies have led to more companies emerging around the country. (Anybots, a Silicon Valley startup working on remote-controlled robots, is another one to watch.)
In the meantime, we’ll be watching closely to see if the balance of power in robotics companies starts to shift westward.