Warehouse robot startup Berkshire Grey inks SPAC deal at up to $2.7B valuation

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Berkshire Grey Inc., a developer of warehouse robots backed by investors including Khosla Ventures and NEA, today announced plans to go public through a SPAC merger.

The Bedford, Massachusetts-based startup expects to raise as much as $413 million through the deal. From there, Berkshire Grey will head to the stock market with an initial valuation of as much as $2.7 billion.

A SPAC merger is a transaction wherein a firm goes public by teaming up with a so-called special-purpose acquisition company, or SPAC. It’s an entity set up by investors with the specific goal of taking another firm public. In the case of Berkshire Grey, the SPAC taking it public is Revolution Acceleration Acquisition Corp, which is listed on the Nasdaq stock exchange.

As a result, Berkshire Grey will also trade on the Nasdaq following the transaction’s expected completion in the second quarter.

Berkshire Grey develops warehouse robots that are used by major brands such as Walmart Inc. and FedEx Corp. to increase the efficiency of their supply chains. The startup’s machines can shuttle items between different parts of a fulfillment center to free up employees for other tasks. Berkshire Grey also provides customizable robotic arms that can automatically pick up items from shelves or out of containers and place them into cardboard boxes that can be shipped to consumers.

Berkshire Grey’s systems are powered by artificial intelligence software that the startup says learns ways to become more effective over time. Moreover, the software allows the individual robots in a warehouse to share information with one another to improve the facility’s overall operational efficiency. Berkshire Grey says its approach makes it possible to reduce operating costs to such an extent that customers can realize a return on investment in as little as two or three years.

The startup is targeting several different markets with its technology. Berkshire Grey’s robots can be deployed by postal services to sort mail, at e-commerce fulfillment centers to process online orders and in the warehouses of traditional brick-and-mortar retailers, to manage merchandise shipments to their stores. The startup argues that such use cases amount to a significant market opportunity: It estimates that only 5% of warehouses are already automated today.

Berkshire Grey will use the proceedings from the SPAC merger to support its growth plans. The Wall Street Journal reported that the startup recorded $35 million in sales last year and expects revenues of $59 million this year, with an eye toward becoming profitable in 2024.

Photo: Berkshire Grey

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