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Issue #38 - The Future of Manufacturing
Topics this time: 2021 in review, updated I4.0 landscape, industrial cybersecurity, one massive and one canceled IPO, and a few acquisitions.
👋 Welcome to Issue #38 👋
this is the last issue of 2021. I’ve sent out 12 newsletters this year and I really must say: a lot has happened. Wow. Let’s recap this year briefly:
🔥 What’s hot: sustainability, robotics, supply chain resilience, upskilling & reskilling, MES
👎 What’s not hot: digitization projects, IoT platforms, offshoring, pilot purgatory
🚀 On startups:
💸 Fundraising: Startups that have PMF got big cash injections, especially in the US. Examples include nTopology, Path Robotics, and Augury.
🤑 Acquisitions: we’ve had more acquisitions than in previous years from both established companies (eg. Siemens, Jungheinrich) and tech companies (eg. Xometry, Augury)
📈 On hyperscalers (Amazon, Microsoft, Google):
They’re becoming more relevant and could increase their market share in IoT platforms to roughly 30% (up from <5% ca. 5y ago)
They’re able to attract top tech talent, therefore have a high product velocity (eg. AWS IoT Lab)
🏭 On established manufacturers
IT infrastructure: lots of manufacturers are currently refining their IT infrastructure. There is lots of budget for integrating different IT systems and connecting the „last mile“ on the shop floor
Partnering: Slowly but steadily companies see value in collaboration with other companies and that collaboration can be quicker and cheaper rather than building own solutions (eg. MES)
Automation: Strong adoption of both physical automation (AGVs, AMRs) and software automation (RPA, Process Mining)
People: companies invest heavily in learning and development for their employees, including significant investments in their frontline workforce
Enjoy reading - and as always, sharing and feedback is a gift 🙏
I. Frameworks and our next course
Part of the course are unique frameworks and practical material that will help you in your daily job. This includes the most updated industry 4.0 map with now more than 500 startups. We'll talk more about the market map in one of the modules to help you understand the trends and details.
II. Future of Manufacturing Community
👪 Future of Manufacturing Community: Our community has crossed 220 people and we’ll keep adding new members. You’re eager to discuss with us topics such as the role of hyperscalers, sustainability in manufacturing, or the how to escape the pilot purgatory? Join the waitlist here and follow us on LinkedIn to stay up-to-date.
🏭 Community session: in our last session of the year, we talked about the future of MES systems. Stay tuned for more events in 2022.
Got a friend or colleague interested in the future of manufacturing? Help me spread the word by sharing the newsletter if you like it!
III. What I’ve enjoyed reading 👇
📟 Industrial cybersecurity investment makes comeback
The increasing number of attacks has brought more attention and investment into the operational technology (OT) security space. Recent investments include Palo-Alto-based Armis Security’s $300M private equity round at a $3.4bn valuation, and Dragos’ $200M series D at a $1.7bn valuation. Recent OT security headlines include the shutdown of Colonial Pipeline due to ransomware attack and the passage of the $1.2 trillion U.S infrastructure bill with $2 billion for cybersecurity initiatives. OT security solutions have become easier to install - but the sector is still looking for its first large, independent, or even public company.
🏭 Asian Factories stabilized before new Omicron challenge
Asian countries outside of China have posted expanding PMIs. South Korea’s exports are on track to hit an annual record from strong holiday demand and higher product prices. Economists believe most central banks in the region will maintain pro-growth policy. The durability of Asian factories’ manufacturing and logistics will help global supply chain bottlenecks, but the negative impact from port logjams in the US and Europe remain significant. However, the impact of Omicron was not reflected in these numbers as more countries went back into lockdown again.
🤖 One lake could transform North America’s EV industry
The Salton Sea located in California could have the capacity to provide 600,000 tons of lithium a year, which is 1.5X of the world’s current lithium production. Lithium is crucial to the EV transformation and most of the lithium to make EV batteries today comes from Australia, China, and the “lithium triangle” of Bolivia, Chile and Argentina. Manufacturers like GM have already invested in the Salon project, with a goal to yield battery-grade lithium by 2024 and deliver 30 new EVs globally by 2025.
🤑 Three reasons why NFX invested in MOOV
Moov Technologies is a B2B marketplace for buying and selling used manufacturing equipment focused on the integrated circuit manufacturing industry. After announcement $40M series A led by Tiger Global, James Currier, the general partner at NFX and moov’s seed round investor, gave three reasons why they made the investment:
Reason 1: B2B Marketplace: 100’s of vertical B2B markets will digitize in the next 15 years into marketplaces. We’ve invested a lot into B2B marketplaces at P9 Capital in the past years.
Reason 2: Moov’s Software Integration: Many transaction processes from Moov can be replaced with software to significantly reduce transaction time and increase accuracy. Moov can immediately underwrite supplier or buyer financing or insurance, and allow customers to increase sales without hiring more people.
Reason 3: Founding Team’s Experience: The founding team had spent 10 years managing transactions by the old fashioned way, in which they knew buyers and sellers personally and understood their pain point. Moov was founded by second-time founders Steve Zhou and Maxam Yeung, who have a Silicon Valley mindset that are both comfortable with experimentation and having long-term outlook with the firm’s commitment to doing something big.
IV. About industrial Startups and Companies
🤑 Samsara IPO is priced at $23 a share with valuation of $11.5 Billion
The San Francisco, CA-based company that develops end-to-end IoT solutions for businesses, raised $753 million by offering 35 million shares at a price range of $20 to $23. Samsara was founded in 2015 and booked $379 million in revenue and 13,000 core customers. Samsara states that it has pioneered its end-to-end solution Connected Operations Cloud to allow businesses that depend on physical operations to harness Internet of Things (IoT) data to develop actionable business insights and improve their operations. Below an example of their IoT devices. Samsara is a great data point to show other manufacturing startups what's possible!
🤑 Inpixon acquired IntraNav to expand capabilities for Industry 4.0 solutions
Inpixon (Nasdaq: INPX), the Indoor Intelligence company, announced the agreement to acquire IntraNav GmbH ("INTRANAV"), a leading industrial IoT (IIoT), real-time location system (RTLS), and sensor data services provider. INTRANAV's flagship offering is its enterprise-class, multi-technology, RTLS IoT platform. The comapny counts large enterprise such as Siemens Energy, TB International, Festo, and PERI to its customers. IntraNav’s researched showed savings versus traditional methods are:
Inbound: Unload, inventory and arrange goods: 23% faster
Storage: Identify and pick-up goods, find available shelf, unload: 37% faster
Outbound: Find, load, transport, unload at outbound point (preliminary data): 42% faster
🤑 Xometry completes three acquisitions to accelerate digital transformation
Xometry (NASDAQ: XMTR), the global marketplace for on-demand manufacturing has acquired Thomas, a leader in product sourcing, supplier selection and digital marketing solutions for $300M. This acquisition is Xometry’s third acquisition within two months, with Factory Four, a developer of cloud-based applications and services to improve factory floor productivity and Big Blue Saw, an online waterjet and laser cutting service. These acquisitions will rapidly expand Xometry’s buyer and seller base and significantly enhancing their global digital marketplace for manufacturers.
💵 Volocopter is withdrawing from planned US IPO
German electric air taxi developer Volocopter has cancelled its planned SPAC IPO in the US. The investor letter points out “facts and figures” in recent weeks and months are “unfavourable” for a successful SPAC transaction. Volocopter’s CFO Florian Reuter described the problem as some transactions could only cover the transaction costs with no further capital for company growth. Lilium, one of Volocopter’s competitors, raised significantly less than hoped for its IPO in September.
V. Additional funding news in short 👇
👉 Serve Robotics: the autonomous sidewalk delivery company that spun out from Uber-owned Postmates in March has closed an expanded seed round of $13M. Read more...
👉 Robotic Research: Maryland-based Robotic Research has raised their first outside capital ($228M in series A) in nearly two decades - to launch a commercial division called RR.AI. The division will develop autonomous driving technology for commercial truck, bus, drayage and logistic vehicles. Read more...
👉 Blickfeld: Munich’s Light Detection and Ranging (LiDAR) sensor maker has announced an extension of their Series A, brought the total to $31M and led by New Future Capital, Continental and Wachstumsfonds Bayern. Read more...
👉 NavVis: a global leader in end-to-end solutions for reality capture and digital twins has received 25€M in equity funding led by Cipio Partners. Read more...
👉 Elementary an artificial intelligence machine vision company, closed on $30M in Series B funding led by Tiger Global, to continue developing its manufacturing quality and inspection tools. Read more...
VI. Additional content and the I40 Landscape
Industry 4.0 Map - Reinventing the Factory Stack
I just updated the map in December - there are now more than 500 industrial startups in the landscape.
👉 Do you want to learn more about these industrial startups in the map, how the landscape evolved, and future development? Learn more about it in our online course.