French warehouse robotics vendor Exotec lands $90 million for high-density storage

The French warehouse robotics startup Exotec has raised a $90 million financing round to fuel its international expansion, focused on recently formed Atlanta and Tokyo offices, and to meet a growing demand for warehouse automation technology, the company said today.

The “series C” round was led by 83North, with participation from Dell Technologies Capital, and supported by previous investors Iris Capital and Breega. It follows an earlier round of $21.2 million and brings their total funding to $111.2 million.

The Lille, France-based company opened its first U.S. office in May with an Atlanta location, and has signed partnerships with the system integrators AHS, S&H Systems, and Conveyco for distribution across North America. Exotec says its revenue doubled in 2020 as it onboarded new clients like Carrefour and Fast Retailing (Uniqlo group), and now forecasts it will produce up to 4,000 robots per year by 2021.

The company says its “Skypod 3D” warehouse robots allow retailers and e-merchants to quadruple their warehouse productivity and increase their storage capacity fivefold by deploying autonomous robots to move in a three-dimensional pattern at a speed of 13 feet per second, creating a faster and more efficient picking and preparation process. 

Despite its record of quick growth during the startup’s early stages, Exotec enters a warehouse robotics sector with plenty of competitors. The growth of e-commerce same-day delivery and online grocery have recently helped drive a hot market for robotic retrieval systems based on dense, cube-shaped storage. In contrast to traditional warehouses with sprawling layouts and wide aisles, such systems are particularly well fitted for urban fulfillment operations such as micro-distribution centers.

Recent investments in that sector have included the Canadian robotic storage and retrieval system startup Attabotics raising $50 million in venture funding in August, rapid rollouts of new installations by Fabric and Takeoff, a large installation of AutoStore systems for grocery fulfillment, and $40 million raised in May by artificial intelligence (AI) provider Covariant for its projects with shuttle-based system supplier Knapp and other partners.

And just today, AutoStore announced it had released a new software suite for its cube-based order fulfillment system, saying its “Router” platform could increase robot productivity and efficiency by up to 40% by finding the most efficient path for its robots to move and deliver orders inside its high-density grid system. “We recognize the importance of anticipating future challenges,” AutoStore CEO Karl Johan Lier said in a release. "This pandemic has demonstrated to us that the retail and e-commerce market will never be the same as it was. With Black Friday and the holiday season approaching, warehouses and micro-fulfillment centers will need the flexibility and high-speed efficiency that Router can deliver.”

However, Rudi Lueg, managing director of Exotec North America, says Exotec is in a strong position to serve the fast-growing micro-fulfillment center (MFC) sector while more established players focus on large-scale deployments. “My estimate is a $2 billion market in the U.S. for Goods to Person (GTP); maybe more,” Lueg said in an email. “With the explosive growth in online retail, driven by the pandemic as well, I’m sure this market will grow by factor of 2X or 5X. So, I believe the demand will be stronger than the supply for quite some time.”

In comparison to Exotec, the incumbent, shuttle-based systems have a long lead time of 12 to 18 months, and are complex to install, he said. And established cube-based storage systems can achieve high density, but much of the inventory placed near the center of the cube can take up to 20 minutes to access, making it a poor fit for quick-turn, e-commerce items.

According to Lueg, Exotec and a few other “disrupters” combine the best features of shuttle-based retrieval, quick lead times of 3 to 9 months, and simple design. Together, those features make Exotec’s approach well-tuned to provide warehouse fulfillment automation for smaller-sized facilities in the next two years, while the more established vendors focus on “mega-facilities” of 400,000 square feet or more, he said.

“E-commerce demand has been steadily on the rise for years, and the pandemic introduced a sense of urgency to keep up with consumer demands,” Lueg said in the email. “With a massive uncertainty about the future of in-store retail, many of our customers and prospects voiced a strong need to scale their e-commerce fulfillment operations to keep up with shifting consumer behaviors.”

Exotec raises $90 million to accelerate its international expansion. ??
A round led by @83NorthVC - supported by @DellTech Capital - and by our historical investors: @Iris_Capital and @BreegaVC. pic.twitter.com/H6VVzcJuPR

— Exotec (@exotec) September 29, 2020