Although robotics transactions have slowed in many sectors during the novel coronavirus crisis, investor interest has continued in the competitive market for manufacturing and supply chain automation. OTTO Motors, a unit of mobile robot maker Clearpath Robotics Inc., today said it has closed $29 million in Series C funding.

Demand for autonomous mobile robots (AMRs) has been growing worldwide as companies struggled to find workers to serve critical needs. The skills gap was projected to leave 2.4 million positions unfilled between 2018 and 2028, according to a 2018 study by Deloitte and The Manufacturing Institute. Market analysts said they expect the need for automation to grow as companies seek ways to improve business continuity during and after the COVID-19 pandemic.

“Mobile robots are no longer a luxury in the workplace; they are a necessity,” stated Matthew Rendall, co-founder and CEO of Clearpath. “In a post-COVID world, AMRs enhance worker safety and bring resiliency to supply chains. As enterprises adapt, AMR demand will accelerate globally. This investment will enable us to grow to meet the evolving needs of the factories and warehouses of the future anywhere in the world.”

“We have been affected by the pandemic just like everyone else has,” he told The Robot Report. “The first thing we did was stop everything and set the standard that our employees’ health and safety would be the top priority over anything else. So we have done things like change procedures that used to require two people to now being done by one.”

“We have spread out people in our manufacturing facility so they aren’t as close together,” he explained. “We have split robot builders into alternating, consecutive shifts to reduce the number of staff needed on-site at any given time.”

OTTO Motors serves growing demand

OTTO Motors claimed that more than 70% of its AMRs are deployed at Fortune Global 500 companies. The company said its AMRs have enabled enterprises such as GE, Toyota, and Nestle automate materials handling for increased safety and productivity.

In recent months, OTTO said it has also seen a surge in demand from essential businesses responding to increased operational risks associated with COVID-19, including food, beverage, and medical device manufacturing.

“Right now, both OTTO Motors and our sister company, Clearpath Robotics, have received several inquiries from research institutes, government bodies, and private industry about using OTTO 100 in industries ranging from factories to healthcare to public spaces,” said Rendall. “We are actively working to support all of these proposals. That could mean more diversity in the models we offer or models that are specific to certain industries.”

The company cited use cases such as how it helped Berry Global Group, a Fortune 500 manufacturer, meet increasing customer demand despite labor shortages at a plant in Kentucky. Berry Global’s fleet of 19 OTTO AMRs operate around the clock, supplying cases to and from automated production machines.

“Our mission to ensure a safe and productive work environment, along with the challenges of persistent labor constraints, has led us to increase investments in creative automation solutions,” said Scott Spaeth, director of corporate automation at Berry Global. “The OTTO vehicles address those challenges and deliver improved operations reliability, while enhancing the working environment for our employees.”

Funding to support global expansion

Clearpath said its latest investment follows years of rapid growth, and OTTO Motors has now raised a total of $83 million (U.S.) in funding to date. Kensington Private Equity Fund led the round, with participation from BMO Capital Partners, Export Development Canada, and previous investors iNovia Capital and RRE Ventures.

“Clearpath and its OTTO autonomous mobile robots have been on our radar for some time,” said Rick Nathan, senior managing director at Kensington. “We see strong trends favoring the acceleration of industrial automation generally, with Clearpath positioned very strongly to benefit from this rapidly growing sector.”

“OTTO’s technology leads the market for core infrastructure for the factory of the future,” he added. “It is becoming increasingly important for customers across all manufacturing and a compelling opportunity for our investors.”

With AMR companies the focus of several recent investments, such as Locus Robotics Corp.‘s $40.8 million equity fundraising last week, how did OTTO Motors stand out to get funding?

“I think we stand out for a few things,” replied Rendall. “If you look back to 2016 when we last raised money, we had developed the technology and done a few implementations, but it was still on a pretty small scale. Over these last three to four years, OTTO has really perfected the tech, in terms of making it enterprise-grade.”

OTTO to build out network

OTTO also expects to hire more workers, he said. “Right now, we’re at about 260 employees, plus about 40 certified partner organizations that all have their own teams,” said Rendall. “We do envision hiring more people to support our go-to-market activities so there will be a lot in the sales, marketing, and support areas.”

“We have built up a network of partners throughout North America – and more recently Japan – to provide support and maintenance in the markets where our customers are,” he said. “And we have installed larger numbers of OTTO vehicles in larger facilities.”

OTTO Motors said it will use the funding will be used to expand its global network of delivery partners and accelerate its product roadmap for enterprise customers with emphasis on its autonomous technology.

“Earlier this year, we announced a partnership with Altech to distribute OTTO products in Japan. We spent some time getting that process and partnership in place after years refining our partnership model in North America to make sure we were ready for other geographies,” said Rendall. “We can support any facility where an item has to be moved from Point A to Point B, so we see manufacturing markets across Asia, Europe, and South America as our future targets.”

“We are working on CE certification, and there have been some hardware and software changes needed to make that happen,” said Rendall.