TL;DR:
- Gather AI acquires competitor Ware in a strategic move to strengthen its position in the drone inventory market.
- Ware’s absence at ProMat raised questions, but CEO Hank Skorny revealed that the previous CEO’s sudden resignation led to a leadership transition.
- The acquisition brings together complementary technologies and go-to-market approaches, allowing for better customer service.
- The warehouse inventory market is substantial, and using drones for inventory tracking is an emerging concept.
- The combined company will serve 25 customers, with undisclosed client distribution prior to the acquisition.
- Gather AI raised $20 million in Series A funding, while Ware secured a $2.5 million seed round.
- Ware was considering additional fundraising, but the CEO saw the potential in joining forces with Gather AI.
- Gather AI’s cash position is strong, but scaling may necessitate further funding.
- Both companies’ decision to rely on external drone hardware suppliers contributed to their lean operations.
- The acquisition will accelerate Gather AI’s ability to scale and revolutionize warehouse inventory management.
Main AI News:
It’s disappointing when an exhibitor pays for booth space at an event but fails to make an appearance. The empty table, the copied signage – leaves attendees questioning their absence. Such was the case with Ware at the ProMat event in April. Operating in the drone inventory sector is no easy feat, and the lack of information from the Bay Area startup on social media has only fueled speculation. Their last posts on Twitter, Facebook, and their blog date back to February.
In a recent conversation with TechCrunch, Ware CEO Hank Skorny shed some light on the situation, saying, “Back in February, the previous CEO resigned right around when we were preparing for ProMat. It was rather sudden, as he had some personal matters to attend to. I received a call on Friday, asking if I could start on Monday, and I jumped at the opportunity.”
At the time, Ware did not respond to requests for comment, indicating that something more than just a CEO change was underway. As it turns out, the company has been acquired by Gather AI, one of its main competitors.
Gather AI CEO Sankalp Arora explains the rationale behind the acquisition, stating, “Considering the nascent stage of this technology, there are complementary aspects that we are exploring together. Combining forces makes sense, given the substantial market we are targeting. The demand for our solution is skyrocketing. By bringing together the more mature technology of Gather AI and the go-to-market approach of Ware, we can better serve our customers.”
The quote highlights the importance of the “addressable market.” Warehouse inventory management is a massive industry, but the use of drones for tracking inventory is still relatively new and innovative. There have been a few notable adoptions, including IKEA’s partnership with Verity, which deployed approximately 100 inventory drones across 16 countries.
By absorbing Ware’s resources, Pittsburgh-based Gather AI aims to expedite its own scaling process. The combined entity will serve a total of 25 customers. While the specific client numbers of each company remain undisclosed, both parties assure that the distribution was relatively even before the acquisition.
Gather AI secured a $20 million Series A funding round last year, while Ware announced a $2.5 million seed round in late 2020. Skorny reveals that Ware had been considering additional fundraising options as the market demand surged, saying, “I was in the process of raising another round. I had secured funding agreements. However, with the rapid growth of the market and the increasing number of deployment requests we were receiving, I also wanted to explore acquisition opportunities.“
Arora adds that Gather AI is currently in a healthy financial position but acknowledges that scaling may require additional funding. He states, “We are doing well in terms of cash, but as we scale, funding may become a necessity. It’s something we’ll evaluate together as Hank joins the company.” Gather AI currently employs around 30 people, while Ware had a team roughly half that size. Some Ware employees have already transitioned to Gather AI, and plans are in place to determine the remaining team’s future.
One key factor contributing to both companies’ lean operations is their decision not to develop drone hardware in-house. Ware mainly relied on Skydio, while Gather predominantly used DJI. However, the newly formed Gather AI (with Ware’s branding being phased out) prides itself on its hardware agnosticism.
Sankalp Arora emphasizes the significance of their approach, stating, “In the realm of robotics, organizations often need to invest heavily in hardware before delivering a specific use case. In many instances, generic hardware lacks the required specificity. Our founding team has successfully tackled the challenge of indoor drone operations, enabling us to scale like a software company.“
Conclusion:
Gather AI’s acquisition of Ware signifies a strategic consolidation of resources in the drone inventory market. By combining their strengths, Gather AI aims to dominate the industry and meet the growing demand for innovative solutions. The acquisition not only brings together complementary technologies but also enhances their go-to-market strategy. With the significant potential of the warehouse inventory market and the emerging concept of using drones for tracking, the acquisition positions Gather AI as a key player. The financial backing and increased resources will enable Gather AI to scale and drive advancements in drone-based inventory management.
