Auckland robotics specialist Rocos has been sold to US firm DroneDeploy in a multimillion-dollar deal.
Rocos adds sensor and cloud smarts to robots made by others. The firm recently featured at a Spark 5G showcase, where it had fitted out Spot - a "dog" made by Boston Dynamics, so it could be controlled by 5G, and beam back data and video over the mobile network.
The Santa Clara-based DroneDeploy does a similar thing, only primarily with drones.
Co-founder and CEO Michael Winn told the Herald his company's largest deployment involves some 1800 drones for a large farming venture in the US midwest - primarily providing a cheaper, more efficient way of "eyes in the sky" for a large agribusiness to monitor its operations.
"We've been doing aerial drones since we began [in 2013]," Winn says. Like Rocos, it adds smarts to unmanned hardware made by others. In its case, often drones made by DJI.
"About a year ago, we expanded into ground-based data-capture for our construction and energy customers.
"We were looking for a way to capture data, not just from the air, but from the ground - and of course to automate it. And that's why we decided to do this acquisition - because robotic-based data capture is going to become a mainstream by the middle of this decade for most industrial job sites around the world."
DroneDeploy began to work co-operatively with Rocos - a natural fit given both were Boston Dynamics development partners. The working relationship led to the buyout.
It helped that Rocos and DroneDeploy had similar points of focus, including the use of automation to labour shortages, and robots being deployed to collect data in places that are too dangerous for a human.
While the current border closure-induced labour-squeeze is grabbing headlines, Winn says job shortages in areas like agriculture, horticulture and construction have been an issue for years.
"Even before the pandemic, we had companies in those industries scrambling to find enough workers," he says. And he predicts the situation will get worse - at least without more automation - as the population ages in developed counties.
There has been a string of offshore tech sales this year, which has included the $100m+ sale of EzyVet, plus the sale of Vend ($455m), Timely ($135m), Seequent ($1.45b), Ninja Kiwi ($203m), Education Perfect (in a majority-control deal valuing the firm at $455m) and the $500m Hawaiki Cable (a deal now in front of the Overseas Investment Office), while December saw the sale of local retail hero Mighty Ape to Australia's Kogan for $128m.
Tech industry boosters say the money gets recycled into the local ecosystem, and helps give firms the wherewithal to expand internationally while adding bodies in NZ.
In this case, Rocos co-founder and CEO David Inggs says his company currently has 20 staff, and has just moved into a larger office that can accommodate up to 50.
Operations will stay in NZ, headed by Inggs. "Over the next couple of years, we'll continue to recruit and scale the team both for ground robotics and other engineering and other disciplines," he says.
Winn said New Zealand's containment of Covid made it a good place to have an office amid the pandemic - especially in a collaborative, physically hands-on industry like robotics. But he says our go-ahead tech scene, including Rocket Lab, also appeals.
Peter Beck's company has long been on his radar, thanks to DroneDeploy and Rocket Lab sharing a common major investor: Silicon Valley venture firm Data Collective VC. Another key Rocket Lab investor, Bessemer Ventures, is also a DroneDeploy backer, while AirTree Ventures (yesterday seen supporting a $17m raise by Tauranga's LawVu) chipped in to the recent Series E round. And in another "small world" twist, Data Collective partner Matt Ocko sits on the board of NZ Growth Capital Partners, which had shares in Rocos ahead of the takeover.
WInn adds that DroneDeploy, which recently raised US$50m in a Series E round, and has raised a total US$150m - has opened a sales office in Sydney, and has plans for more international expansion, which could include more acquisitions.
Neither side would put a value on the deal, but Winn said it was an "eight-figure" sum (that is, above $10m) but well below the Overseas Investment Office threshold of $100m.
Rocos shareholders ahead of the deal, which closed on July 26, included Inggs, co-founder and CTO Richard Stinear and early hire and head of engineering Neno Kabzamalov.
Got told off for taking the robot dog outside, but thought would be good for some startled reactions from passers-by … but phlegmatic Inner city types played it cool pic.twitter.com/2bETKQMwBX
— Chris Keall (@ChrisKeall) May 6, 2021
Inggs, Stinear and Kabzamalov all worked together at mobile marketing company Plexure immediately before Rocos. The young company was founded in late 2017.
Outside investors included Sir Stephen Tindall's K1W1, the Crown venture capital agency now known as NZ Growth Capital Partners and Icehouse Ventures.
The deal was all done by Zoom during the pandemic. Winn and Inggs have never met in person. But Inggs says the path was smoothed by the fact he and Stinear met with a number of Winn's colleagues during a trip to Silicon Valley a couple of years ago.
Winn won't give any financial projections for his privately-held company, but he sees many more robots in our future as the population ages, and a number of the sectors it services - particularly renewable energy - grow quickly.
"There will be massive growth around renewables," Winn says. "In solar panel arrays, we're working with a European customer with PV [photovoltaic] arrays all around the world. Some of them are in a South American desert, and they've got these massive, massive ground-based panel arrays where you need inspection to take place.
"The ground-based inspection literally needs to get underneath the panels and actually capture photographs, get thermal data. And to do that at scale, you need ground robots that are reliable, and can get through all of those panels very quickly."
A drone, flying overhead, could guide the ground-based robots by detecting thermal hotspots amid the solar array.
Inggs - now DroneDeploy's head of ground robotics, says: "A few years ago, drones made the leap from boys' toys to enterprise tools. Now, ground robotics is on a similar trajectory."
And don't worry about a robot taking your job, Winn adds.
"It's about enabling people to do their existing jobs faster, better; to be safer, and more efficient."
Just don't give Spot a pat on the head next time you see him. He may be on security patrol.
The NZ sharemarket was steady, while the Nasdaq hit another record high in the US.