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ReadySpaces, which offers co-warehousing spaces to corporate customers, secures $20M in debt • ZebethMedia

Jon Zimmerman — the co-founder of ReadySpaces, a warehouse storage provider for small businesses — was working in the self-storage market when he had the idea for a product with the flexibility of self-storage but the capabilities of a traditional warehouse, aimed primarily at enterprise customers. His partner, Kevin Petrovic, had a different company that was a customer of Jon’s at his first “beta” location, in the ’90s. The two started working together to grow ReadySpaces — formerly CustomSpace — into a nationwide business. Today, ReadySpaces operates 32 warehouses and services a customer base of over 2,000 businesses. That impressed investors, evidently, who pledged $20 million in the startup as a part of an all-debt funding round that closed today. Bringing ReadySpaces’ total raised to $40 million, the new funding will fuel expansion, Petrovic says, as ReadySpaces prepares to roll out new services. Why opt for debt as opposed to equity? Petrovic claims that it was “the most efficient capital structure for growth” given the current financial environment. It’s definitely true that equity is harder to come by these days, with valuations dropping and debt financing slowly gaining in popularity. “We have an ambitious growth plan for 2023 and this capital will allow us to remain the leader in the co-warehousing space,” Petrovic told ZebethMedia in an email interview. “Certain pandemic-related pressures, such as backups in major ports, have eased, but we see our business model continuing to resonate every day for both established businesses and small companies just starting off.” While ReadySpaces has been around in some form since 2013, it’s only in recent years that co-warehousing has become a hot trend. The pandemic supercharged co-warehousing, which allowed physical goods businesses (e.g., manufacturers of household products and construction materials) dealing with supply chain challenges to store inventory without having to purchase a facility. In a co-warehousing setup, multiple companies can use the same warehouse space — eliminating the need for the companies to invest in the infrastructure themselves. For example, ReadySpaces offers co-located units in sizes ranging from 200 to 5,000 square feet, each equipped with power units, loading docks and forklifts, Wi-Fi, industrial workspaces, and private offices and conference rooms. A view of a ReadySpaces facility in Tukwila, Washington, where the startup has a sizable hub. Image Credits: ReadySpaces Petrovic posits that co-warehousing lets businesses insure against economic uncertainty and busy periods, such as holidays, by providing affordable, scalable storage for reserve inventory. “The need for small warehouse space isn’t constrained to small businesses,” Petrovic said. “We’ve worked with numerous Fortune 500 companies to provide short-term overflow space. The key is that we take an asset class that moves slowly and is generally difficult to operate in and make it absolutely seamless.” Certainly, ReadySpaces’ competitors have demonstrated the demand for co-warehousing. Saltbox, a company providing co-working and warehousing space for up-and-coming e-commerce businesses, recently attracted a $128 million investment from real estate investment platform Fundrise to expand its footprint. And last year, private equity real estate firm Capstone Equities launched Portal Warehousing, a flexible warehouse solution offering smaller spaces and share amenities, which plans to expand to cities, including Los Angeles, Brooklyn and Las Vegas, in the coming months. As for ReadySpaces, Petrovic claims that the Los Angeles–based company — which employs around 50 people — is “comfortably profitable,” with revenue growing approximately 50% year over year. “Since our last announcement, we have opened numerous new locations and in a few new markets as well. For example, Queens, New York; Kearny, New Jersey; Saddle Brook, New Jersey; and Round Rock, Texas, are all recent new sites,” Petrovic said. “We don’t have a burn rate … Nationally, we’ve seen demand skyrocket by 375% over the last three years.” One point of concern is a slowdown in consumer spending related to inflation, which could depress sales in retail and, by extension, the demand for warehouse space. The warehouse industry is running the risk of oversupply, some experts say, as developers heavily invest in warehouse expansion. Q2 2022 saw a record 613 million square feet of warehouse space built in the U.S. — almost double the construction pipeline in 2019. Petrovic acknowledged the headwinds, but insisted that ReadySpaces is in a position to weather them. “There are numerous major shifts in the industrial real estate market happening now due to robust demand and high development costs,” he added. “Our focus is on navigating these market changes successfully so we can continue to provide the product that we know customers love.”

Attabotics raises another $71M to grow its vertical robotic warehouse solution • ZebethMedia

“Amazon remains the best member of our business development team,” Attabotics founder and CEO Scott Gravelle says with a hint of snark, “as companies go look for alternatives and look for ways to stay competitive. Amazon has been setting customer expectation in North America for years. They’re the benchmark.” It’s a familiar story for anyone in the fulfillment space. Amazon’s success in warehouse robotics has effectively created its own industry. Many have followed in the company’s footsteps with Kiva-style robots, but Calgary-based Attabotics believes it has built out a new paradigm for the category. The company builds densely packed vertical storage structures that utilize robots and AI to find and fetch items. The company says it’s able to accomplish this in 15% of the standard warehouse space by building up. One of the major appeals of such a cost-saving system is that you can bring it to more densely packed urban environments. That means, among other things, bringing fulfillment centers closer to customers. The strategy has helped the firm drum up a good amount of funding since its 2015 founding. This week it announced a $71.7 million Series C led by Export Development Canada and featuring Ontario Teachers’ Pension Plan Board. That brings its total funding up to $165.1 million. It’s a less than ideal time to be out there looking for funding, but Gravelle tells ZebethMedia that time was of the essence. “We’re not at the stage where we could have [waited],” he explains. Gravelle adds, “We’ve got some great traction with some great customers. We signed a deal with the DoD. So now it’s time to go from making stuff work to growing the business and deploying it and executing it.” In September, the firm announced Attabot 2022, the first commercialized version of its technology, which began rolling out to select customers a month prior. Per the company: Attabot 2022 is equipped with a flexible payload to accommodate larger bins up to 16” tall at 100lb – an increase of 25% from Attabotics’ previous robot release. Its ultra-lean, modular design translates into 60% fewer parts than the previous beta model and allows for further flexibility and forward compatibility. The company is continuing to grow its headcount — albeit cautiously — as it looks to fill 30 positions and expand beyond its engineering core. Attabotics’ current headcount is around 300.

Pickle picks up $26M for its truck unloading robots • ZebethMedia

Fulfillment has arguably been the hottest robotics category over the past two years, as companies have looked to stay competitive with Amazon, even amid ongoing labor shortages. Still, one of the most important links in the chain remains one of the least addressed. Truck unloading isn’t a particularly easy problem to solve, but Pickle Robot Company is single-mindedly focused on it. When I paid a trip to the company’s offices on my trip to Boston last week, Pickle pointed out precisely how large of a problem this has become. Warehouse jobs are tough enough to fill these days, but unloading pallets and trucks bring their own spate of issues, including repetitive heavy lifting and wildly fluctuating temperatures. Imagine stepping foot inside a shipping container that’s been sitting in direct sunlight all day. Traditional heavy equipment like forklifts come with their own issues. The company describes their offering thusly, “Pickle is founded by a cast of MIT alumni. We are teaching off-the-shelf robot arms how to pick up boxes and play Tetris.” The company notes that it has “unload[ed] tens-of-thousands of packages per month at customer sites,” primarily in Southern California. The work thus far has been part of a pilot with United Exchange Corporation, which has deployed the system in a distribution center. Today Pickle is announcing a $26 million Series A raise led by Ranpak, JS Capital, Schusterman Family Investments, Soros Capital and Catapult Ventures. Image Credits: Pickle Robot Company “Customer interest in Pickle unload systems has been incredibly strong, and now that we have our initial unload systems out of the lab and into customer operations we have a clear path to broad commercialization,” said founder and CEO AJ Meyer. “The early customer deployments, financing and leadership additions set the stage for us to accelerate customer acquisition and build the company infrastructure we need to deliver more systems to more customers in the coming months.” That last bit is especially important. As you’re most likely aware, now is not a great time to be raising — even in a booming category like warehouse automation. But given the size and breadth of Pickle’s testing, putting funding off in hopes of better economic conditions isn’t necessarily an option when you’ve got product to deliver. And besides, Pickle’s not the only game in town either, figuratively or literally. Boston Dynamics notably chose truck unlocking as the focus for its second commercialized robot, Stretch. Unlike that solution, however, Pickle’s is tethered. Agility has also explored truck unloading for its Digit robot. Even with that added competition, we’re talking about a huge total addressable market, with room for more than one player.

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