We tend to focus on the technology and performance aspects of robots and robot companies we cover, but the business aspects are just as important, if not more so. You can design the best, fastest, most capable robot the world has ever seen, but if you can't get investment capital to fund bringing that great product to the market then it's kind of meaningless.
We've been convinced for a long time that the NAO robot developed by Aldebaran Robotics in France was very, very hot. Now it turns out that they have been able to successfully pitch that same message to key venture capital investors. Last Friday they announced the closing of their first round of venture capital financing with a whopping 5 million euro (approximately USD $7.35 million) investment lead by CDC Innovation.
The first round venture capital investments are a huge vote of confidence in the potential for humanoid robots like NAO. On the one hand, we're extremely happy to see it happen since it reaffirms our own opinions, both of the NAO robot and Aldebaran. Still, there are a few downsides.
First, there will be some dilution of the founder's equity. How much is hard to say, and how that dilution may eventually weigh on the company's overall direction, commitment, and strategy is also difficult to judge at this point. However, we do strongly feel that the motivation of Bruno Maisonnier, Aldebaran's founder and the father of NAO, is of critical importance to the company's future.
Second, Aldebaran will have to take a more measured, and less risky, approach to the market. That will result in their products, specifically the NAO robot, being rolled out slower and in a more controlled and managed fashion. Instead of rushing the robot to market and pumping sales as we previously inferred from their press releases and promotional material,
Aldebaran has decided to restrict the first generation robots to targeted research labs and universities during 2008. The second generation robot, forecast for 2009 will expand the users to early adopters, and sales to the general public may not kick off until sometime in 2010 with the third generation product. We certainly have to applaud the professional approach they are taking. Still, waiting another two years to see NAO take his rightful place in the market is a long time to wait. A lot can happen in two years, including some strong competition for NAO entering the market.
Here's the official press release covering the Aldebaran Robotics financing:
Aldebaran Robotics’ NAO robot raises a 5 million Euro Series A financing round
Paris, France, January 7th, 2008 - Aldebaran Robotics, a start-up, developing humanoid robots for consumer applications, announced today the closing of its first round of venture capital financing.
The Series A financing of EUR 5 million was led by CDC Innovation alongside I-Source Gestion. The proceeds will be used to expand the team, move from prototype to series production and bring to market the first-generation NAO robot in 2008, followed by the launch of the second-generation product in 2009. Go4Venture, a London-based corporate finance advisory firm specialized in international technology equity private placement and M&A, advised the company in its fund-raising process (www.go4venture.com).
Aldebaran Robotics (www.aldebaran-robotics.com) is a Paris-based company which develops and markets 60-cm tall humanoid home robot companions. With a computer at its core, it is a unique, evolving and fully programmable platform targeting a variety of usage such as education, entertainment, home care or security.
The company reached an important milestone towards establishing its position as the benchmark platform in this market, when the RoboCup International Committee (http://www.robocup.org) decided in August 2007 that the Aldebaran Robotics’ NAO robot will succeed Sony’s Aibo as the new official robot in the worldwide RoboCup’s Standard Platform League (http://www.tzi.de/spl/bin/view/Website/WebHome).
Aldebaran Robotics will pursue the development of its product range in three stages, with a first generation robot targeting the labs and universities market in 2008, and a second-generation robots focused on early-adopters in 2009. The third generation product will be targeting the mass market.
"Aldebaran Robotics has an innovative technology platform and a significant growth potential," said Valery Huot, Managing Partner at CDC Innovation. "Aldebaran offers a truly compelling investment opportunity: a unique technology protected by strong intellectual property, a clear product pipeline, and an experienced management team. The potential of this emerging robotics company is extremely exciting, and CDC Innovation is very pleased to support it as the first investment of its new fund Innovation III."
"Aldebaran Robotics is in very strong position to become a worldwide leader in the home robot companions market which is the fastest growing segment in robotics today", said Nicolas Landrin, Partner at I-Source Gestion.
"Support from reputable investors such as CDC Innovation and I-Source Gestion is a strong validation of our firm's technology and business model", commented Bruno Maisonnier, Chairman and CEO of Aldebaran Robotics. "The company has hit key milestones since its creation in 2005 and this financing will enable us to broaden our team with world-class experienced professionals, start deliveries to the RoboCup’s teams as well as prepare the consumer market launch next year targeting early adopters."
About CDC Innovation: CDC Innovation (www.cdcinnovation.com) is an international venture capital firm founded in 1996, with its head office in Paris and a local presence in the Silicon Valley and in Switzerland. With over 415 M currently under management, our focus is on venture investments at both the early and late stage, in two sectors: information technologies and life sciences. Our aim is to create value by providing talented entrepreneurs with the resources, experience, and network necessary to turn world-class technologies into great businesses.
About I-Source Gestion: I-Source Gestion (www.isourcegestion.fr) is an early stage venture capital firm, focusing on Information and Communication Technologies (Software, Saas, Multimedia and Telecom). We invest at first round in early stage companies (either just created or up to 3 years of existence). Our funds are managed by a stable and senior team with a strong background in the industry, in finance and in entrepreneurship. This allows us to actively support each portfolio company and bring significant added value.
Contacts: Bruno Maisonnier, Chairman and CEO, Aldebaran Robotics (+33) 177371752, firstname.lastname@example.org Valery Huot, Managing Partner, CDC Innovation (+33) 140769905, email@example.com Nicolas Landrin, Partner, I-Source Gestion, (+33) 139230200, firstname.lastname@example.org Jean Michel Deligny, Managing Director, Go4Venture, (+44) 7989 596 028, jean-michel.deligny@ go4venture.com
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