In 2016, Will Glaser was a consultant for technology companies and found himself increasingly immersed in autonomous vehicles, fascinated by how the industry uses computer and computer vision. The former co-founder of music streaming service Pandora and software company Hydra Systems has come to the conclusion that it could be the most disruptive technological advance of the current and next decade, but probably not. because of driverless cars.
Glaser realized that recent advancements in computer vision could benefit society earlier and more broadly, and thought of what is a more universal experience than going to the grocery store and shopping. having to queue to checkout. “I landed on cashless shopping, which is both economically important and useful to end users, and that’s what got me excited,” Glaser said. Forbes. The resulting company, Grabango, got to work in 2017 to design out-of-the-box cashless systems. The technology allows Grabango users to shop as they would regularly, in stores they already frequent, but skip the line and simply scan a barcode near the door on the way out. The service was officially launched in September 2020 and has five corporate chains among its first customers, like the grocer Giant Eagle, and has quickly racked up thousands of loyal customers. The startup has increased its round of Series B, as originally reported in the Midas Touch newsletter, to continue expansion.
The Berkeley, Calif., Based company raised a $ 39 million Series B funding round led by existing funder Commerce Ventures with participation from Founders Fund, Honeywell Ventures and Unilever Ventures, among others, including major players in the grocery sector. “When someone you want to be a client wants to invest, you make room for capital,” Glaser says of oversubscribed financing. The startup has raised $ 71 million in total and will use the latest batch of capital to expand into more stores and secure more partnerships. Matt Nichols, a partner at Commerce Ventures, says the company has been tracking the cashless retail space for a few years. Commerce initially invested in the company’s 2019 Series A and doubled for Series B once the startup launched in stores. “They are the only ones to date that actually go into a real production environment by taking an existing store and making it work,” Nichols said. “Really, no one else has done it before and that’s what got us excited.”
Nichols added that the system’s ability to be modernized in existing stores was also a draw because of its potential for scalability, which was intentional. The system works through a maze of sensors on the ceiling equipped with cameras the same size as those on an iPhone. The cameras track where shoppers are going, what they buy and what they do and don’t take with them. At least two cameras can see every item in the store at any given time. This approach allows the sensors to be installed in almost any store, as changes in store layout or merchandise will not impact the accuracy of the system, which currently stands at around 99.6%, according to Glaser. “[Retail] is a tough, tough business, ”says Glaser. “Our presumption is that retailers are smart and know what they’re doing, so we need to tailor our technology to them and not the other way around.”
When Grabango users checkout, they scan their app at the designated space and simply exit. Glaser says the company does not track or store the data collected by its sensors. He adds that the system deletes his data almost immediately after the buyer’s departure, noting potential liability, and that he does not use any facial recognition. “Privacy rights are a priority,” says Glaser. “I cringe when others are happy to sell data. We are deeply, deeply not in the data business.
Glaser says the company has seen high demand for its technology so far and has already had to turn down potential partnerships. “We only signed on five customers, not because we only got five calls, but they are the best retailers in the world,” Glaser said. “Each of the five companies has sales of over $ 1 billion. They don’t want us to do a single proof of concept store, they want to develop their entire fleet. Our model is not to grow as fast as possible, but as wisely as possible. Glaser and Nichols both predict that once consumers start using this kind of technology, they won’t settle for less.
Glaser sees many possibilities for Grabango to grow both in the same category through its international expansion and also in different retail categories. “Computer vision is the most powerful technology of the coming decade,” he says. “The part we focus on is people interacting with things, others are focusing on keeping a Tesla on the road. We have adopted the go-to-market strategy of starting with grocery stores and convenience stores because the needs are greatest there.