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Fabric

October 26, 2021

Dawn of the Robocorn? Micro-Fulfillment Robot Specialist Fabric Raises $200M on $1 Billion Valuation

Fabric, a maker of robotic micro-fulfillment solutions for grocery and e-commerce retailers, announced today they have raised $200 million in a Series C funding round. The new funding puts the company’s valuation at $1 billion.

Formerly called Common Sense Robotics, Fabric works with large online grocers and retailers such as Walmart, Instacart, and FreshDirect to build automated micro-fulfillment centers via a mix of fulfillment-as-a-service and hybrid ownership models. The company’s solution involves an intricate blend of robotics, vertically stacked storage of products, and human operators and packers that help package up the final delivery and handoff to delivery drivers.

You can see what a Fabric micro-fulfillment center (MFC) in Tel Aviv looks like in action as it processes an order below:

The World's First 1-hour Delivery Fulfilled by Robots

The funding, which vaults the company into what it describes as a ‘robocorn’ status, is not a surprise given the fast growth of the company and the broader micro-fulfillment market. Interact Analysis forecasts MFC automation and robotics market to grow from $136 million in 2020 to $5.3 billion in 2025. Revenue growth will be fueled by a rapidly growing number of MFC installations in various formats throughout the forecast; Interact expects the the total number of MFCs installed annual to grow from 29 in 2020 to over 2100 new MFCs installed in 2025.

The company plans to use the funds to grow its fulfillment solution in the general merchandise market and build a network of micro-fulfillment centers in cities across the United States. The company’s model relies heavily on building warehouse fulfillment centers that allow grocery retailers to outsource micro-fulfillment to Fabric. Fabric also co-invests and builds distributed fulfillment centers in partnership with larger players such as Instacart and FreshDirect.

That strategy makes Fabric part of a new kind of third-party logistics (3PL) player built around robotics and automation as an enabling platform for their distributed fulfillment networks. While large 3PL companies like XPO Logistics and C.H. Robinson been adopting automation in their warehouses for some time, companies like Fabric, Exotec and Attabotics are building hybrid networks of dark and retail/integrated grocery MFCs architected from the get-go with robotics in mind (rather than a bolt-on or forced integration). As more retailers invest in distribution networks tailored towards a grocery industry with 50%+ e-commerce penetration, next-gen MFC platform companies like these are well-situated to benefit.

“While we use the term ‘robocorn’ a bit tongue in cheek, we see this milestone as a real turning point in the industry, from what was once trepid exploration of micro-fulfillment to total market validation and now rapid expansion,’ said Fabric CEO Elram Goren in the release sent to The Spoon. “We’re thankful to our partners for trusting us to serve them and to our incredible team who will continue moving mountains to make our vision a reality. This is still ‘day one’ for us, and we’re extremely excited about the road ahead as we expand our offering into new markets, drive more efficiencies across the supply chain, and focus on scaling.”

July 22, 2021

Instacart and Fabric Partner to Offer Automated Fulfillment to Grocers

Instacart announced today a new multi-year partnership with Fabric that will see the two companies jointly offer automated order fulfillment services to North American grocery retailers.

The new automated fulfillment option will combine Instacart’s e-commerce ordering capabilities and human shoppers with Fabric’s robot-powered item-assembly process. Retailers can outfit this new system inside existing retail spaces or in dedicated warehouses. So customers will place a grocery order online, robots will assemble those items and Instacart shoppers will pack them up and either stage the completed order for curbside pickup or deliver it to the customer’s front door.

The company didn’t provide many details about implementing this new automated system, only saying it is the first phase of its “next-generation fulfillment initiative” and that it “plans to kick off early-stage concept pilots in partnership with Fabric and grocery retail partners over the coming year and beyond.”

Interest in automated fulfillment certainly accelerated over the past year because of the pandemic. Fears of COVID-19 had record amounts of people buying groceries online in the U.S. Those numbers have come down in recent months as the vaccines have rolled out and people feel more comfortable shopping in person. The latest data from Brick Meets Click shows that U.S. online grocery sales for pickup and delivery were $5.3 billion in June, down from its peak of $7.2 billion in June of 2020. If those numbers continue to trend down, will retailers still feel the pressing need to automate?

Big retailers like Albertsons, Kroger and Walmart have all doubled down on their own automated fulfillment plans over the past year. But as Grocery Dive has pointed out, there are still concerns around the efficacy of automated order fulfillment and whether it provides truly valuable productivity gains and return on investment. Now, instead of building their own automated infrastructure, smaller retailers could choose to offload that work to Instacart and Fabric, so we could see more grocers trying these systems out.

July 28, 2020

FreshDirect to Use Fabric’s Robots for Grocery Fulfillment in D.C. Area

Online grocer FreshDirect announced today that it has partnered with Fabric to build out an automated, robotic grocery e-commerce facility in the D.C. Metro Area. This is the first public U.S. partnership announcement for Fabric.

Using a system of totes and racks, Fabric creates automated systems for shuttling grocery items around a warehouse to fulfill e-commerce orders. Fabric will be building out an existing 10,000 sq. ft. When it opens later this year, the new FreshDirect facility in which it will be able to process 500 – 1,000 orders per day. Each order will take just minutes to fulfill, enabling FreshDirect to have a two-hour delivery window for customers in the D.C. area.

While this is the first U.S. facility for Fabric (née Common Sense Robotics), the company has two operational fulfillment centers running in Israel. Steve Hornyak, Chief Commercial Officer at Fabric, told me during a phone interview this week that his company has many more partnerships that will be announced soon, and that Fabric has seen a surge in demand.

“We got thrust five years into the future,” said Hornyak, adding that customers that had planned on implementing automation for e-commerce fulfillment in 2021 or 2022 are accelerating those timelines and starting the projects now.

There are 7.2 billion reasons grocery retailers are rushing into automation right now. The pandemic and subsequent stay-at-home orders pushed grocery e-commerce into multiple record-setting months in a row, hitting $7.2 billion in June. FreshDirect itself was hit hard in NYC during the height of the pandemic, at the beginning of the e-commerce surge, with delivery windows near impossible to get for most people. The inability to accept as many orders presumably translated into lost business for FreshDirect.

Hornyak said that the biggest issue for retailers Fabric is talking with is capacity. How do they increase the number of e-commerce orders they can fulfill? “Doing it manual sort-and-pick is arguably unprofitable,” said Hornyak. And while Fabric definitely has an incentive to bemoan the cost and speed at which humans move when picking items for an online grocery order, he has a point. Robots can just fulfill orders faster and for longer.

That’s why there are so many retailers investing in automated fulfillment. ShopRite and Albertsons both have programs with Takeoff Technologies, which builds micro-fulfillment centers in the backs of existing grocery stores. Walmart has a trial going with Alert Innovation. And Kroger is building out standalone automated warehouses powered by Ocado’s automation technology.

While we don’t know what permanent impacts the pandemic will have on buying behavior, large swaths of consumers have now had five months of new habituation, including buying their groceries online. As more automation gets built out, theoretically, delivery and curbside pickup options will get faster, which will attract more consumers, and an automated virtuous cycle will be born.

October 23, 2019

Fabric (Formerly Common Sense Robotics) Raises $110M Series B for More Automated Grocery Fulfillment

Fabric, the fulfillment automation company formerly known as Common Sense Robotics, announced today that it has raised a $110 million Series B round of funding led by Corner Ventures with participation from Aleph, Canada Pension Plan Investment Board (CPPIB), Innovation Endeavors, La Maison, Playground Ventures and Temasek. This brings the total amount of funding raised by the company to $136 million.

Fabric builds out robotic micro-fulfillment centers that allow retailers such as grocers to process online orders quickly. A combination of lift and ground robots autonomously shuttle items around precisely where they are packed by a human and sent out for delivery or pickup. These fulfillment centers can be built off-site and squeezed into smaller spaces, giving retailers micro distribution hubs that are closer to consumers to facilitate faster delivery. For example, Fabric is building 18,000 sq. ft. facility in an underground parking structure in Tel Aviv.

Though they are still new, micro-fulfillment centers have the potential to be great disruptors in the grocery space. Online grocery shopping is currently a very small slice of overall grocery spending, but it’s growing. The ability for a retailer to fulfill and deliver online orders more quickly should create a virtuous cycle that begets more online grocery shopping.

Because of this potential to get you your groceries faster (so you presumably buy more), Fabric is among a bunch of companies looking to automate order fulfillment. Takeoff Technologies also creates robot-powered micro-fulfillment centers, typically built into the back of existing grocery stores, and is currently working with Albertsons, Ahold Delhaize and ShopRite. Walmart has partnered with Alert Innovation to pilot an automated fulfillment center at a store in New Hampshire, while Kroger is building out standalone robotic smart warehouses around the country.

As noted, last month Common Sense Robotics rebranded as Fabric, in a move that seemed to de-emphasize the “robot” part of its offering. In a press statement at the time, Elram Goren, CEO and co-founder of Fabric, explained the rebranding by saying “For us, our robots and software are critical to what we do, but at the end of the day, they’re a means to an end. What we’re really here to do is to be the fabric that binds retailers and their customers together, enabling goods to be fulfilled and delivered faster and cheaper within cities.”

As part of its re-brand, the company moved its headquarters from Tel Aviv, Israel to New York City, where it is building its first U.S.-based fulfillment center. According to today’s press release, Fabric says it has contracts to build out 14 more centers in cities across the U.S. in 2020 and will use the new funding to expand operations here.

September 10, 2019

Common Sense Robotics De-Emphasizes Robotics with “Fabric” Re-Branding

Common Sense Robotics announced today that it is changing its name to Fabric in a move that emphasizes the company’s focus on overall logistics and puts its robotic origins on the back burner.

Up until now, Fabric had been best known for building out automated robot fulfillment centers that could be built into dense urban areas to facilitate fast delivery of online grocery shopping orders. The hook for the company was its ability to build its robotics vertically to make more efficient use of the spaces it built into. In July, the company announced it was breaking ground on an 18,000 sq. ft. facility in an underground parking structure in Tel Aviv.

In today’s press announcement, Elram Goren, CEO and co-founder of Fabric, provided a statement about the rationale for the name change and the removal of robotics from its name, saying “For us, our robots and software are critical to what we do, but at the end of the day, they’re a means to an end. What we’re really here to do is to be the fabric that binds retailers and their customers together, enabling goods to be fulfilled and delivered faster and cheaper within cities.”

We reached out to Fabric to find out more about the impetus for the name change, and was told that all of the messaging could be found in the press release.

Fabric is part of a wave of companies looking to automate and subsequently speed up online grocery order fulfillment, which is a small-but-growing slice of overall grocery shopping. Takeoff Technologies, which builds similar fulfillment centers in-store, is working with Sedano’s, Ahold Delhaize and Albertsons, and recently announced a standalone fulfillment center in New Jersey for ShopRite. Kroger is building out robotic fulfillment centers using Ocado’s technology. And Walmart is using Alert Innovation for its own back-of-house automated fulfillment.

In addition to the re-brand, Fabric also announced today that it will move its corporate headquarters from Tel Aviv to New York City. So now we’ll have to see if a new name and a new town can help Fabric weave itself into the U.S. grocery business in a meaningful way.

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