Mithril Capital, the venture capital fund co-founded by American billionaire entrepreneur and investor Peter Thiel, has opened its India chapter by leading a $140 million (approx Rs 10 billion) round in industrial robotics start-up GreyOrange.
Ajay Royan, who co-founded Mithril along with Thiel, will join the board of GreyOrange, which has emerged a leader in the warehouse automation sector globally. Binny Bansal, co-founder and group CEO of India’s largest e-commerce marketplace Flipkart, also participated in the round.
The Series C investment also saw the exit of some early backers of GreyOrange, but investors Tiger Global, Blume Ventures, Mitsubishi, Flipkart, and Project Verte continue to retain their stakes. GreyOrange did not disclose the valuation at which it raised the funding.
“As online and offline channels converge, we are excited to support robotic solutions that bridge the world of bits and the world of atoms, driving better health, safety and efficiency for workers and customers alike,” Royan said.
GreyOrange, which recently marked its entry into the US, is one among a handful of Indian start-ups that has built a global business. It already has a strong presence in Southeast Asia, Japan, Germany and India, with two R&D centres in Singapore and India, and a third coming up in the US.
The warehouse robotics firm plans to utilise the capital to grow its supply chain and bolster R&D, as it aims to double its revenue year-on-year for the next three to four years.
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It says that the market for warehouse automation is booming given the trend of online retailers moving offline, while offline retailers are moving online.
Samay Kohli, co-founder and CEO of GreyOrange, however, said that the round wasn’t just to add firepower to the company’s growth plans. In fact, the company will retain its growth targets after the round.
“The idea of raising this round is much more about the strategic partnership with Mithril and getting a person like Ajay to join the board. Mithril backs visionary, deep-tech companies, and takes a seven- to 10-year view in true disruptions. This was more of a round created to get them onboard,” said Kohli.
“It’s a San Francisco-based fund and Ajay and Peter are also very well known in the community, so obviously they could help with enterprise clients and such. But the main thing we’re looking at is their vast experience and if you look at several of their investments, they’ve done really well and in some sense them being there led to that success,” added Kohli.
For GreyOrange, the big disruption in retail is the biggest driver of business. While Kohli points out that several of the largest fashion players in the world are now automating their warehouses to deal with both online and offline sales, every big player in several other large retail sectors was moving the same way.
While the world’s largest retailer Amazon and Alibaba have developed a lot of their warehouse technologies in-house, they haven’t yet opened up to selling these technologies or services to others. For traditional retailers and other emerging online players, Kohli says GreyOrange wants to be the player that helps them catch up quickly.
On the acquisition front, GreyOrange says it isn’t really looking to grow inorganically at the moment and while it may decide to bring onboard some firms they would mostly be for technology or talent. In the past, the company has acquired three firms, but has not publicised the deals.
“GreyOrange offers robotics technology for operating flexible automated warehouses and has the largest market share globally in this space. We’ve grown rapidly in recent years and will accelerate the expansion of our regional teams, especially within the US,” added Kohli.
Thiel, who was an early backer of Facebook, has made only one other known investment in India. In 2016, the PayPal co-founder backed Indian start-up ClearTax which helps individuals file their taxes. Back in 2012, his comments on innovation in India drew the ire of many when he said there was “zero need” for innovation in countries like India and China, all entrepreneurs needed to do was copy things that worked.