In 2021, robotics startups have been flying high. Unlike other categories that collapsed under the weight of the global pandemic, interest in automation was at an all-time high, as companies tried to overcome supply chain issues and persistent labor shortages. Robotics and automation were insulated from the broader investment slowdown, but were also ultimately affected.
It’s not as if the signs weren’t there. I started the year with a post titled “The Thing We Thought Happened with Robotic Investments, Definitely Happens.” This thing is slowing down investment. After a banner year, 2022 was the second worst year for robotics investments in the past five years.
It was second only to 2020, which was one of those once-in-a-lifetime global anomalies. Completely understandable in this case. This number represents five consecutive quarters of decline in venture capital funds.
today, New numbers from Crunchbase It indicates another annual decline for 2023. The year is not over yet, of course, but investments since the beginning of the year in the US market amounted to $2.7 billion, down from $5 billion last year, $9.1 billion in 2021 and up to $3.4 billion. Billion dollars that came in 2020.
There are a few things at play here. First, we knew that the initial excitement wouldn’t last forever. Some countries in the world have returned to normal, relieving some of the pressure to automate as quickly as possible. Second, there are macro trends that need to be addressed.
Venture capital investments have slowed more broadly, and now it’s about robotics. But the good news is that this category has remained steady compared to the rest of the scene. The surge in interest in generative AI — and all things AI — has been part of maintaining its status.
The past few years have also provided robotics companies with the opportunity to prove their proficiency in the real world, demonstrating the value of automation outside of the manufacturing sector that we have been seeing for several decades now.
Robot sales have also recently seen a decline, thanks to the economic headwinds that followed the initial pandemic outbreak.