Turns out grocery stores can be a lot smaller when you don’t need room for pesky humans with shopping carts.
In fact, Takeoff Technologies’ micro-fulfillment grocery centers are one-eighth the size of a traditional store. And staffed by helpful robots.
Takeoff’s vision for automated grocery shopping seems to have the potential to penetrate a hesitant industry, and the company secured $25 million in Series C funding this week to chase that goal.
Here’s how the model works: Existing grocery retailers partner with Takeoff to set up a micro-fulfillment center close to their target end customers. Normal folks can go online and select the groceries they want, and a robot will gather up to 60 items from the tiny center’s shelves in just a few minutes. From there, customers can pick up the groceries or have them delivered.
So, what’s in it for grocers?
First, it’s a chance to compete with Amazon’s looming e-grocery threat. Second, it’s profitable, according to Takeoff. Hyperlocal fulfillment centers capture online business and reduce last-mile and labor costs.
In the grocery space, a profitable e-commerce solution will turn heads. This industry is among the last to buy into the e-commerce craze because its margins generally are too low to bother with fancy automated systems — not to mention warehouses filled with unbought, spoiling produce.
While Takeoff isn’t the only company introducing robotics to grocery retail, there are some things that set it apart. Most notably, it’s an end-to-end solution, providing most everything its partners need for implementation including a customer user interface, assortment, fulfillment, pickup, delivery and replenishment. It also has an exclusive partnership with Knapp, which specializes in warehouse robots.
Takeoff has already signed on large U.S grocery chains like Albertsons, Ahold Delhaize, Wakefern and Sedano’s, as well as Woolworths in Australia. The new funding will help the startup scale across the U.S., Europe and Australia, it said in a statement.
Next up for Takeoff is the rollout of its next-generation micro-fulfillment center, which will be smaller, with better storage capacity and a new type of robot that can carry groceries around without running into anyone — something many human shoppers haven’t mastered.
The company currently employs 150, with plans to take its Boston-based team from 50 to 100 within a year.
The Series C brings Takeoff’s total funding to $86 million and its valuation to $500 million, the company said. The round was led by Forrestal Capital.
