Amazon.com just announced that it was acquiring Kiva Systems for $775 Million in cash. Kiva Systems is one of my favorite "companies that employ robots" (rather than "robotics companies" -- there's a big difference). Kiva is all about improving warehouse logistics and fulfillment, and they happen to employ a large swarm of robots (see video below) to accomplish this. Namely, they use robots to autonomously fetch and arrange "pods" so that human pickers can more efficiently fill orders. Their technology is exceedingly relevant in the modern age of large (internet) fulfillment centers. Frankly, they're a perfect match for Amazon. According to a November report, Boston-based Kiva Systems boasted revenues in excess of $100 Million, had 240 employees, was growing 130% year-over-year, and was a prime example of a venture capital-backed robotics outfit (having received $33 Million in total). Honestly, this acquisition makes me sad... I would have liked to see Kiva go public. Plus, I certainly hope Amazon doesn't hoard Kiva away for itself and rob the world of efficient, robotic warehouses...
This video shows what Kiva Systems is all about:
To quote the TechCrunch acquisition announcement:
Utilizing this system, robots scurry about the floor locating individual items before transporting them to workers who pack and ship. As founder Mick Mountz told us recently, Kiva accounts for “two-to-four times as many orders per hour as they have done the old way”. The company has been growing at over 100% a year. And the average price per system? $5 million.
From a CNN Money article back in November 2011:
Today, Kiva Systems is profitable. Backed by $33 million from investors, the Boston company has 240 employees, a list of prominent customers and revenue of more than $100 million, according to Mountz. He says sales grew 130% last year, and that Kiva is hiring 20 to 30 people each quarter to keep up with demand.
To put the magnitude of this acquisition into perspective... today iRobot's market capitalization was sitting at just under $750 Million... so the Kiva acquisition was on the scale of iRobot! This is a big story for robotics, and it makes so-much more sense than the $100 Million Aldebaran buyout that occurred last week.
So... while the acquisition will obviously be beneficial to Amazon (yay, since I'm a shareholder!), it also makes me really sad. I thought Kiva Systems was a prime robotics IPO candidate. We need more of those if we expect to convince investors that robotics IPOs are feasible (though the acquisition is certainly a good outcome!). Even more concerning... I hope Amazon doesn't hoard Kiva away for itself and rob the world of efficient, robotic warehouses...
[ Hat tip to my buddy, Robert Shuttleworth. ]