Raising investment funds in the time of COVID

3D robotics supply chain company Attabotics raises $50 million USD in venture capital during a pandemic

Whenthe pandemic hit this spring, Calgary startup Attabotics was in the midst of amajor effort. The four-year-old robotics company was striving to raise funds toaccelerate deployment of its novel warehousing technology, scale manufacturingoperations, bolster its team and more. 

"COVID-19 was a proverbial black swan event that caught us all off guard," said Brad Simpson, VP of Corporate Development at Attabotics. "The pandemic triggered enormous fear in the market practically overnight and left many investors sitting on their capital," says Simpson.

Investors who weren't spooked by the market struggled to conduct due diligence as travel bans prevented on-site visits and in-person meetings. On top of this, Attabotics faced far more competition for capital due to the economic downturn caused by the pandemic, he says.

For all of its challenges, COVID-19 has shone a spotlight on Attabotics as retailers and brands look to modernize their supply chains. The boom in e-commerce is putting pressure on global supply chains and turning up the heat for traditional retailers and grocers, who must automate their distribution systems to compete with Amazon, Simpson explains.

Attabotics wants to help companies do just that with its warehousing solution, which uses robots to move products through a 3D storage matrix. The concept is inspired by how ants organize food in a colony.

"As damaging as COVID-19 has been to so many industries, it's validating the need for what we offer," he says.

Attabotics is capitalizing on this e-commerce boom and recently raised $50 million USD in Series C funding through a round led by the Ontario Teachers' Pension Plan Board (OTPP), via its Teachers' Innovation Platform, along with Honeywell Ventures.

The capital will help Attabotics fine-tune its technology, which is attracting attention from companies spanning the retail, B2B, and food and beverage industries, among others. Luxury retailer Nordstrom is piloting Attabotics technology at two California warehouses and Microsoft is piloting its new network product, Azure Private Edge Zones, in Attabotics systems.

Simpson says the company's trajectory has been supported by Alberta Innovates and several others leading up to the OTPP investment. Shortly after the pandemic was declared, Simpson connected with Michael Kerr, a Technology Development Advisor (TDA) with Alberta Innovates who has worked with Attabotics since its early days.

As a TDA, Kerr plays the role of coach, connector and confidant to early-stage companies. This time around, he worked behind the scenes, contacting provincial and federal partners that might be able to help, and initiating conversations.

As the pandemic rolls on, Attabotics continues to grow. Simpson says the company is actively recruiting skilled employees to join the more than 200 already working at its headquarters in Calgary. He admits it's an unlikely place for a robotics company, which would traditionally find venture capital in places like Silicon Valley or Boston.

"We're proud to be a part of an ecosystem where other robotic companies and related businesses can bloom," says Simpson. "Alberta Innovates and others have created an environment that provides companies access to capital and more, allowing them to launch and scale in Alberta or Canada, and we're very grateful for this."

This story is an update on Attabotics' journey on the path to commercialization since we featured the company in July 2019.