The picks-and-shovels strategy behind the robotics boom

0:00Hi, I'm Mike Waitzman, co-host of the Robot Report podcast. If your company wants to reach decision makers in robotics, automation, and AI, you're in the right place. Each week, thousands of industry professionals listen to this podcast for the latest news, expert insights, and conversations with leaders building the future of robotics. This spot could be yours. To learn more about podcast sponsorship opportunities, visit therobotreport.com slash podcast.

0:36what's up everybody welcome episode 262 of the robot report podcast i'm steve crow executive editor of the robot report thank you folks as always for tuning into the show joined by mike oitzman senior editor of the robot report mike's in some new digs this week but what's going on sir how are you yeah doing good yeah hanging out here another week uh and you know hey we're getting closer to robo business so lots of crazy prep for for robo business now it's getting serious it's getting serious 34 33 days away i believe so yeah which is crazy so we'll talk about that we have a great show we do want to dive into a story mike that nobody's broke yet that we caught wind of yesterday.

1:21So today's Thursday, September 17th. We found out about this on Wednesday, September 16th. And it has been rumored to be something that might happen. And we've learned that it's become a little bit more official. So SoftBank is looking to buy the Robotics and AI Institute from Hyundai. And of course, RAI, it was once the Boston Dynamics robotics and AI Institute. And then they kind of dropped the Boston Dynamics moniker from the name, but of course is run by Mark Raybert, right? So this is not a done deal yet, but it is moving to the next step of the process. It's being reviewed right now by the Committee on Foreign Investment.

2:07This is the CFIUS. It's an official US government agency that reviews deals between US-based companies and non-US-based companies when they're doing business together or they're trying to acquire each other, right? So the RAI Institute's based in Cambridge, Massachusetts, SoftBank, obviously a Japanese company. So I don't know how far along they are in this review process. I don't know if it just started this week. I don't know if it's been in the works for a couple of weeks. I don't know how long these things take at this point in time, but I know people are flying back and forth between Japan and Boston and trying to make sure that this happens.

2:46So interesting story, right? I always think about this. I've talked to a number of people about this just over the last couple of days. And like Mark Raybert, I love Mark Raybert. We've had him speak at the Robotics Summit a number of times. He is largely responsible for the humanoids as we know it and a lot of other folks getting into robotics and inspiring people along the way, right? But the number of times he's sold these companies is just unbelievable, right? So it's almost coming full circle. So Boston Dynamics was a SoftBank company for I think three years. So it was from 2017 to 2020. And then SoftBank sold Boston Dynamics to Hyundai in, I think it was December 2020, we broke the story that Hyundai was acquiring Boston Dynamics for almost$900 million.

3:36And then they initially, they also decided to fund this Robotics and AI Institute with another additional$400 million initial investment, right? And that was what Mark stepped away from Boston Dynamics to run this research institute. They've done some amazing work over there the last number of years, but it's just incredible to see him continue to sell these companies. And again, come full circle going back to SoftBank just their number of years after they sold Boston Dynamics to Hyundai. So kind of a full circle story as this goes here. But again, it's not finalized, but interesting nonetheless.

4:14What did you think about this when we learned about this? Yeah, I think it is an interesting deal. As you said, Mark has orbited around SoftBank with many of his companies for so many years. And And SoftBank has some deep pockets, continues to have some deep pockets here. You know, I'd be curious to see what their vision is with this in the long term, whether there's a combination. They like to put companies together, right? I'd be curious to see if there's something else in play that they're thinking about. I have to imagine there is in a portfolio that could come up against this. But again, you know, Mark made the point that he likes doing research, not necessarily a product guy.

4:56So, you know, what do you do with the IP that spins out of the RAI? It's got to go somewhere, right? It'd be interesting to see how they hook that up at some point in the future if this all goes through. Yeah, and they have, obviously, it's not just him, right? There's a lot of other amazing people at the RAI Institute. One of the people who told me this, I was talking with this person yesterday, and you mentioned other companies under the SoftBank umbrella. They're trying to acquire ABB, right? That's not a done deal. Oh, yeah, that's right. That's not a done deal yet. I mean, I would imagine all signs are pointing to that happening here in the next couple of months, I would think.

5:35But one person told me that he thinks this is a great fit, that the RAI is a great fit for SoftBank specifically because of the potential ABB acquisition. And if you add the RAI strengths and AI technologies, the sort of new age of robot learning and AI and different types of capabilities and combine that with ABB strengths, the phrase that was used was, it'd be a steamroller, right? ABB is already a world-class organization, but if you can add in some of this new AI technology, they're going to be even better than they already are. There's rumors that SoftBank wants to acquire or fund heavily 1X technologies, right?

6:19That's been rumored to happen. So who knows how all this is going to play out? But yeah, the pockets over there are pretty deep, I guess. Yeah, that would be a very interesting combination because ABB certainly knows how to commercialize and productize and distribute and sell and support real products. So, wow, that could be quite a behemoth. Yeah, so again, we've heard this from multiple people yesterday, right? Somebody reached out and told us this. We've checked with other folks. They are saying the same thing. I reached out to the RAI Institute. they sent me back this quote, quote, we don't have anything to share on this topic right now.

6:56We'd still love to stay in touch and keep you in the loop when we have news to share. So, you know, they're not commenting on it for obvious reasons, but multiple people are telling us the same thing that the deal is currently being reviewed by the Committee on Foreign Investment. And again, it could fall apart. I hope it doesn't fall apart. You know, deals have fallen apart before, unfortunately, right? See Amazon and iRobot. But if this comes together, I think it would be a great fit. So best of luck to everybody involved in this going forward. But stay tuned on that. And we'll update you folks if we learn anything else.

7:33But we do have a great show today. An interview coming up later on with Teddy Haggerty. He's the CEO and co-founder of Robo Inc in Robo Store. Mike, I've seen Teddy on some interviews over the last few months, But why don't you give us a little preview of what you're going to talk about with Teddy later on in the show? Yeah. So, look, Teddy is the founder and CEO of, as you said, RoboStore and RoboInc now, which is the latest extension of the business. And, you know, he's helped bring robotics forward in the market segment here. They are the Unitree distributor for North America. So anybody education-wise, university-wise who's bought a robot has probably bought it through RoboStore.

8:19That's how they've made a name for this. Daddy didn't have any experience in formal robotics. He built a drone business in high school. So he's a serial entrepreneur. The business he had before this was selling hardhats. His dad had a construction business. he realized there was a need for a new new type of hard hat designed created the ip created an incredible business early 20s so he's a huge financial success he knows how to build a business from the bottom up and so i'm very interested to see what he's going to do with the world of robotics here uh so uh yeah it's a great interview uh he's a very outgoing individual and i think you'll enjoy this conversation all right look forward to that a little bit later on in the show.

9:07We'll recap a couple of the news stories that happened this week here in just a minute, but we do want to plug upcoming Robo Business Show, which Mike talked about briefly before coming up October 20th and 21st out in Santa Clara, California. This is a very special show for us. It's the 20th anniversary show. I think I've been involved in maybe half of them at this point in my life. I know, Mike, you've been there a number of times over the years and involved in many as well, but it should be a great show. Over 2 ,000 people there, over 100 exhibitors on the show floor. We have a startup alley where we're giving the space away for free to a number of robotics startups to try to get them exposure to the ecosystem.

9:43We'll have over 70 people on our stages over the course of the two days talking all things commercial robotics development, the good, the bad, the ugly, everything in between. You can check out the agenda. We're still adding a couple of people here and there. We just confirmed somebody from Tesla is going to be speaking about physical AI as well. So if you want to get involved, if you want to get your tickets, head to robobusiness.com to learn more, reach out to any one of us here at the robot report and make sure you stay tuned to the end of the show. As we've done the last few weeks, we have a special discount code that's exclusively for our podcast listeners as a way to thank you guys for, for listening all these times, what, 262 episodes, Mike.

10:22So stick around to the end of the show. We'll help you save a couple of bucks on your robo business registration, but we've got you covered. We're going to get to the news. Now we have you covered with all the latest news and information with our network of websites. Make sure you check us out at The Robot Report and Automated Warehouse. Follow us on social media. Sign up for our weekly newsletter so you never miss a beat. The big story this week, Mike, Agility Robotics unveiled the next version of Digit. So this is Digit 5. Earlier this week, of course, Agility is getting ready to go public through a SPAC with Churchill Capital, which is a shell company.

11:00But pretty interesting robot. It's a lot different from previous versions. So why don't you take us through some of the changes? And again, we have a story about this on the robot report.com that we'll link to if you somehow have missed this. But it's a pretty different robot. Yeah. Brianna and I got a chance to talk to Jonathan Hurst earlier this week. He is super excited about this latest release. And, you know, Jonathan's a leg guy. You could say that. He started the company way back when with the concept of taking Avian legs forward. And Jonathan, in the conversation, it was really fun. He talked about how they built the first Cassie robot for speed.

11:42It would have been very fun to see Cassie compete last month in the robot competition. It would be fun to see how it competed with that leg format. because he said that's what they built the original CASI for, and that's essentially what they built the original Digit for, was thinking it would need to move fast. And as they've learned through some practical deployments, that wasn't the need. And, you know, Digit, the original versions of Digit, a little bit clumsy getting down low when lifting things off the ground. And so they have gone back to the drawing boards with Digit 5 and delivered a more human-like knee and leg orientation.

12:23The other interesting things, there's some pictures in this story and a few videos. You know, the robot has essentially built-in knee pads so that it can reach down and get on its knees. If it needs to, in an emergency stop situation, just settle onto its knees so it's dynamically stable. And same thing on its rear. So it actually has pads on its rear as well so that the torso can settle onto the ground. So it can essentially, very nimble, I guess, get all the way down to the ground in a deep knee bend to pick stuff effectively off the ground or on lower shelves as it might need to reach something low.

13:00So they really see a lot of these applications, lifting things low, lifting them high, as they've done with these initial forays with applications. and in doing so, Steve, I mean, Jonathan has always taken humanoid safety very seriously. That was a big part of the conversation. And so this design is designed to meet the latest specs that are coming out around humanoid safety. You know, if you press the E stop, you know, it can settle down into a very safe and secure pose instead of stumbling, you know, off in one way or another. That's really how he described it. haven't seen that situation yet but that's really you know the crux of this new design so very interesting that you know what the kinematics behind this this new digit five with its bipedal motion yeah the the two biggest things for me were the the the before all the versions had backwards bending knees right ostrich knees right now they've reversed that like you said the human human shaped knees and oriented knees to me that's a huge deal right i mean that was what john that's what Jonathan's research is based on, right?

14:10For a number of years ago. So I think for them to make that change, you know, there's something to that, right? There must've been, I can't imagine that was an easy decision for, for him and for some others to make. But I think it, hopefully it's the right one. And then, yeah, the safety and, and hopefully not having to cage these things off, which is the direction agility is trying to go with digit is also a big deal as well. So it can, It has the pads where it bends down and can stop. It can also detect humans a certain distance away, 360 degrees around the robot. I don't think they came out and said that they have any actual safety certifications at this point in time.

14:51I think that's probably something that's still to come. Yeah, the safety standards are coming, but they are in line with that. They've been involved with that. They know what those are going to involve as if they're accepted in the current trajectory. and that the key is that the robot will be compliant when all of those standards are. The big standard that they have adopted with Digit 5 is for production in Europe, they're going to be CE certified. So being CE certified is a key certification, not a safety certification, but a certification that lets them deploy in Europe now. Because again, any production machine has to be CE certified, whether it's in enclosed or running around that that's not the c certification c certification is about you know radio frequency noise uh electrical safety all those things and one of the things that jonathan said um you know the company's over 400 people now and again we talked about the burn rate in a couple episodes ago as they get ready to go public they got 400 people They're ready to start producing these in volume.

15:57But as Jonathan said, you know, they would do these pilots with lots of customers in the U.S. and Europe. And the ones in Europe that said, okay, you accepted the product. It does what you need to do. Can we deploy it now? And as Jonathan told me, a lot of customers said, well, no, we can't deploy it because it's not CE certified. Well, this was just a research project. If you want to put it into our real warehouse, you've got to be CE certified. And of course, they didn't have that with Digit 4. So that's another big part of this whole redesign is to make sure that the robot can get the CE certification and they can actually deploy it now on the real warehouse floors in production.

16:38Yeah, we also did, Brianna did a great job on the story too, looking at the evolution of Digit over the years, right? You can really see how this thing has evolved. And, you know, it's corny to say it's grown up, but it really has grown up, right? So this version, Digit 5, it's bigger, it's faster, it's stronger. it's 284 pounds it's five feet 11 inches tall could reach up to seven what's just over seven feet tall uh seven feet high excuse me digit four could only reach five and a half feet high so they've done a lot of different things jonathan talked a lot about how the lessons that they've learned at these you know trials or uh initial deployments and how they've really improved the robot so we'll see i mean i think they've come a long way you know they're they're still not using five-fingered hands.

17:22I think every other humanoid company on the planet is using five-fingered hands for manipulation. He talked a lot about that with you guys as well. They have a swappable end effector. It's still sort of like a claw-like gripper, I think. But he talks a lot about this. And I don't have the exact quote in front of me, but I know there was a quote where he said, the five-fingered hands that all these other humanoid companies are using just aren't good, right yeah go ahead yeah one of the things jonathan said he he believes that a tendon based finger interface is the future it's just not there yet it just needs to be you know easy to replace the tendons because they'll stretch over time um and that'll be all part of that design but he gave one example he um i think i can't remember the exact name of this competition but there was a competition in the last year for individuals who amputees, right?

18:16And they had all these prosthetics to try and help amputees get back into work operations. And the winner of the best end effector, if you want to call it that, for a human amputee was a two-fingered gripper. So the winning solution was a two-fingered gripper with rotating wrists that was able to interact very quickly for, you know, manipulation tasks for an individual handling that. And so I think his point being that, you know, right now, two or three finger grippers are the right answer for a lot of industrial use cases, whether that's the right answer for things outside of the warehouse, maybe different answer.

19:00It's still a lot of work and research and implementation to get long-lasting grippers in that regard in the future. Yeah, that competition was the Cybathlon. There we go. That's what it was called. Here's the quote that he had. And I think it's interesting because it's very contradictory to a lot of other things that we're seeing, right? So, quote, one thing we learned is that general purpose hands don't exist. There are none on the market. There are none coming soon. There are hands that look like a human hand, but they're not very good. So, I mean, I go back to when Melanie Weiss was CTO there a number of years ago, right?

19:36She kind of said the same thing. If you look at all of industrial robotics over the years, none of these robots have used five-fingered dexterous hands to accomplish any of the tasks that they've been tasked with. But another big improvement is the charging. It said that upgraded to a 10 to 1 run to charge ratio. So, if you run for 90 minutes of operation, they're claiming it. It takes just nine minutes to charge it. So it can work, I think, more than 20 hours a day. So again, all of these things are vast improvements on previous versions of Digit. But again, now we have proof, right? We know how much money Agility has made previous years, right?

20:212025, they made$1.8 million. They haven't sold many humanoids. No company that's building humanoids for industrial environments has sold many of these, as we know. So now the proof is in the pudding. Agility is saying they have over$300 million in back orders specifically for this version of Digit, for version 5. They're claiming they can do a lot more tasks. It's not just the tote moving thing. so i i encourage folks if you haven't watched the video um which looks to be i don't know if it's real footage or not you know i know there's i don't think it's real i think it's still there is there's some footage of the robot just bending down and rotating its arms that i think is real but a lot of the footage or not if all the footage of it working in the warehouse that they're showing i don't think that's real i think that is some sort of realistic simulation i would imagine.

21:17But it does show Digit doing things we haven't seen it do before. So again, all these things point to them going in the right direction, which we're rooting for them, obviously. But you mentioned the burn rate before. The burn rate's not pretty. Was it$100 plus million that they burned in 2025? They're not going to be starting early rollouts of Digit 5 until early 2027. They expect, I think, to be fully up and running with digit five by the end of 2027. So that's a long way to sort of bridge the gap. We don't know what their financial situation is for 2026, but they got a long way to go before they're going to start pumping this thing out in volume, which we hope they do.

22:00So we'll see what happens there. Jonathan and Prost, they're supposed to be talking at RoboBusiness. So we're looking forward to that very much. The last thing I will say, and I have talked, I have reached out to Jonathan about this. And I have reached out to somebody else that no longer works at Agility Robotics. But if you watch the launch video for Digit 5, I commented about this on my LinkedIn post about it. And a couple other people noticed it as well. There's a moment late in the video where it's showcasing not one of Agility Robotics' current robots. It's just another robot roaming around a data center.

22:35And it's a humanoid robot on wheels. And I just thought that's an interesting, like, why would a legged, humanoid company showcase a humanoid on wheels? Why would they do that? They know about all the discourse about wheels versus legs. They've been in a lot of these discussions. So I thought that that was an interesting choice for them to showcase. And I thought, maybe is that a preview of something that they're going to launch in the near future? Is Agility going to launch a wheeled version of Digit. Again, we've already seen them move away from the backwards knees, right? So they're admitting that maybe that decision wasn't the best decision for trying to commercialize in industrial environments, right?

23:23So I wonder, was that a little, hey, here's maybe something that's coming down the pipeline if we can extend our runway and start making some serious cash. So I've reached out to Agility to ask. I haven't heard back from them. I reached out yesterday. I haven't heard back yet. I think they're quite busy, obviously. I did reach out to a former agility employee. And this person says, I'm just going to read the quote. I suspect it is something they are planning to add to the Digit platform. It seems clear to me that wheeled options provide more flexibility and many other humanoids are already using wheels or offering them as an option.

24:03Right. Again, I have no idea. I just thought it was a very interesting choice for a legged robotics company to showcase a wheeled platform doing a hell of a job at a data center. Right. So again, that could be nothing. It could be nothing. It could be, you know, just they're, they're trying to pump up and raise the other, I think the word they used at that part in the video was ecosystem, Mike. So it could be a nod to the rest of the robotics ecosystem. And, you know, there's, there's room for legs in there somewhere or is it a preview of things to come? I have no idea. I'm trying to find out.

24:37I don't think they'll tell us one way or the other, but I just thought it was interesting. So keep an eye on that. Moving forward, next story here. Universal Robots launched its seventh generation robot platform earlier this week at IMTS, Mike. Yeah. So Gen 7 and really, you know, it's the G-Series Cobot arms and some new reach and payload combinations. There are three robots I think we're aware of in the story here, a 10-kilogram, 1 ,750-millimeter reach, a 17-kilogram, 1 ,300-millimeter reach, a 18-kilogram, 950-millimeter reach. So, you know, just filling out the product line with three new product arms here.

25:27a new operating system called Polyscope, a redesigned controller and tool flange and teach pendant. So, you know, they continue to, you know, can buff out the product line a bit. I guess it's a new controller called CB7 with 40 % more compute and a 30 % smaller footprint. So, you know, what else can you do with the product but make it smaller and faster, right? Lighter, better, those kind of things. So, not a huge story, but, you know, they do continue to iterate and innovate on their current product line. Got to assume they're continuing to find opportunities for these different configurations, right?

26:17a new teach pendant probably also version 7 as well 20 % lighter and more ergonomic with a full HD display that's the primary interface for the UR is the teach pendant so it makes sense that they would continue to upgrade that make it better, make it probably less expensive better margin, all those sort of things as the product evolves Yep. So again, we'll link to our coverage of this in the show notes there. UR has been talking up how they're an AI company, leaning into AI. So I think a lot of the developments that they've released with this new generation points to that. They're leaning all in on AI and how can they become the cobot of choice for this new generation of AI technology.

27:09So make sure you check that out in the show notes. Moving forward here, Mike, a new release from our good friends over at InOrbit, where they released OpenRobOps, which is an open source production grade version of their fleet management system. I think that's exactly right. So, you know, and it's also the first reference implementation of the upcoming ISO 21423 interoperability standard. That was a tongue twister. And so, you know, the RobOps group, which I've been following since its inception, has evolved quite a bit, taken on a life of its own now. And this is a great output from that group to deliver this.

27:55And again, you know, the group is open to anybody that, you know, is managing large fleets. And as I like to say, they help companies go from one to 10, 10 to 100, 100 to 1 ,000 and 1 ,000 to tens of thousands. So, you know, if you're at any of those milestones in your fleet deployment, it's probably a good chance to come, you know, check out the organization and what they have pulled together here. You know, the key thing here, heterogeneous, you know, interaction of various robots, I think, is really what they're trying to do. Because, you know, most consumers are going to end up with a variety of different product manufacturer, mobile robots on their floor.

28:36And so the concept here is make sure that they all interact safely, can handle missions, different missions, hand off different missions, take on different missions effectively. That's really what they're trying to come up with a standard for. And same thing with the InOrbit software as well. Yeah, great stuff there. Just a quick note. So InOrbit, some of their folks are the founders of this group called the RobOps Group or Rogue. Mike, I think you're a part of this, but they're hosting their RobOpsCon 2026 on October 22nd. So this is the day following RoboBusiness. It's going to be in Mountain View, California.

29:17It's a really great event. They get a group of folks together who are responsible for managing fleets of robots that are out in the real world, fixing issues that pop up. I'm sure they have some crazy stories about things that have sent robots amok. but they get together and just talk about what are the issues they're doing they're encountering, how are they fixing them? So anybody who's interested in learning about that, we're going to put a link in the show notes to the robot operations group. So you can sign up for that and attend or reach out to Florian and the folks at InOrbit who are behind that.

29:52But I know you've been a part of that, Mike. I think Eugene Dimitri has been a part of that before. It's a great, it's a great group to be a part of. So make sure you check that out. But if you're involved with managing robot fleets out in the real world, it's a great group to get to know. So we'll make sure we link that in the show notes. And plan to extend your trip after coming up for RoboBusiness and stick around for Rob Opscon if you're interested. Yeah, I did want to mention before we go, Mike and I really haven't had a chance to watch this footage. We did mention this last week, Mike, the figure.

30:23You had a story that you wanted to talk about with Figure, the humanoid company, and what it's doing, data gathering and AI. The Index Project. Yeah. So they just came out. Brett teased a big thing yesterday or Wednesday of this week. And they just released four hours of footage of Figure humanoids doing work in random houses around the California area. they're claiming figure had never been any of these houses that figure had never seen any of the objects it's picking up that it's never seen any of the beds that it's helping make uh i just wanted to pass that along you know it's a pretty interesting it's a pretty interesting watch um but i know we talked about it last week so i want to just throw this out there that maybe this is some of the initial uh fruit of all that labor that's being done there it is pretty impressive uh to watch so far and there's there's i have not watched four hours of footage it just came out a few minutes before we started recording this, but there are humans in the rooms with various figure robots messing with it to try to trick it.

31:29And it does a pretty good job. Obviously, it's a demo, so we weren't there to see, but it's a pretty interesting watch. So if you're looking for something to watch tonight, go watch. There's four hours of zero shot work from figure in various homes around the Northern California area. So pretty cool stuff. Yeah, that is very cool. I'm going to check it out this afternoon. But again, make sure you check us out at The Robot Report, an automated warehouse. Follow us on social media. Sign up for our weekly newsletters so you never miss what's going on with the robotics industry. All right, Mike, on to our featured interview now.

32:01We're going to hear from Teddy Haggerty. He's the CEO and co-founder of RoboStore and RoboInc. What are we going to hear from this interview? Yeah, well, Steve, I think a majority of our audience are entrepreneurs. They've all started businesses. is, they know what it's like to have that itch to create a new business. I think you're going to like hearing Teddy's story here about the creation of this new opportunity that he's building in the robotics space. It's not the story of breakthrough robotics technology, but rather how, you know, one company is enhancing and enriching the distribution channel for OEM.

32:36So also, if you're an OEM and, you know, looking for a strong distributor partner opportunity, take note of what I think Teddy's doing here to bring robots to the masses. He's got a strong educational connection with one of his partners who loves to build educational content. That's a part of their robot university. So listen for that part of the story and how it fits into the entire business model to solve, you know, a specific problem in the industry, finding a robot, finding a solution. And, you know, he wants to build an empire on this. So, you know, he's got a big vision. But let's hear from Teddy now about his vision for the future.

33:23Well, on the show today, we're excited to have Teddy Haggerty. He's founder and CEO of RoboStore and RoboInc. Teddy, welcome to the show. Mike and Gene, thanks for having me. Big fan of what you guys are doing and shining light on robots. So this is important. This is good stuff. Yeah, we're excited to talk to you and learn more about what you've been up to. So let's start there. For folks that don't know you and aren't familiar yet with RoboStore, tell us about the origin story behind RoboStore, how you started the business a couple of years ago and built it. We're going to dig into all of the other fascinating aspects of what you're building here.

34:05But let's start with the origin. Yeah, it goes back over 10 years, actually, of how we started RoboStore. And it was never meant to be what it is today because we never really understood what the robot market was going to be. It was totally different. I'll get into that a little bit. But over 10 years ago, I was in high school and I was actually building drones. I was building drones for photography. So I never really saw it as like a way to sell the drone that I was building. but DJI had just come to the market with these controllers where you basically be able to hook up hobby engines and you'd be able to make your own drill.

34:44And there was a company called Tarot and they were over in, I think the UK I was buying stuff from on like eBay. And I was like, so excited. I'll tell my dad about look, look what's going on with this drone world. And they're going to come out with this phantom and DJI was this, this upcoming drone company. I was really fascinated with it. And I was, I've always been, I've always been fascinated beyond like computers. I've been on computers since I was three years old. My parents have pictures of me rolling a Windows 95 ball and use a mouse. So it started a while ago and I got into the business of building a custom drone for high-end photography.

35:15And I built a small business marketing for real estate before it was a thing. I started in 2011, 2012. I was still in high school and that was my thing. So I was like my entry into robots and it actually segues into the robo store kind of call it umbrella now because we have a bunch of different robo businesses. So anyway, that was my fascination. I had met one of our team members of RoboStores named David Erath. He was on Long Island with me and we were both like the drone guys. And he was the only other guy that I would trust to work with drones with me. We met each other on Instagram. I had built a page called Skyview and it was like gaining traction.

35:58There was like 10 ,000 plus followers in 2012, 2013. I had made a couple of magazine covers of my photos. And like, that was as far as it went. I was like selling a service. So David was opening up my, my world to be like, Hey, we can start doing all this ourself. We can build websites. And I was like, I build websites. I'll build them on WordPress for these brokers. And we can basically make the small marketing empire with drones. We were always fascinated with building payloads for the drones and, and doing inspections. And we saw the business like kind of evolving in front of our eyes as, as DGI started to come out, these like ready to fly projects.

36:31And we were like, wait, we don't have to engineer it by ourself anymore and make this this component. It was it was like it was our thing. So fast forward, I take this wild path through my entrepreneurial life and somewhere in like 2014, 2015, I get introduced to crypto and I start going into mining big time. And I'm building a company in college that actually builds out what I didn't understand was basically a mini data center. They were large data centers, actually, by any means. And I would go there and I would outfit them with miners. And I was part of the ICO of Ethereum, just getting into it as like a total low-level consumer.

37:10I didn't realize the magnitude of what was about to come. I really didn't understand it. So I'm like going through this crypto world of navigating of how to start an ICO and all these kind of victitious storyboard type exercises. sizes like, oh, this is like starting a stock and this is this. So I'm always in touch with Dave and Dave and I stay in touch like over 10 years of like, hey, I want to push this thing in crypto. I think mining is going to be this huge subject that people will have their own miners in their home. And I'm thinking like abstract, but I never raised money for it. I never went out and solicited investors.

37:50I just it was like a passion project. And we get going and we start doing really well. So I'm like 21 years old and I'm starting to get these multi, almost million dollar deals for mining. So people want me to build out their mine. They're like, look, if you could build it out, we have this idea of building this mine here and doing this. I go through years of kind of running this like drone marketing company in this Bitcoin mining, what's called like infrastructure setup company. And it was called Mining Dudes. And we were just the mining dudes, Dave and I. And we traveled all around the world, not world, but the United States.

38:26And we were trying to go bigger, bigger, bigger. We had a website where we'd sell consumers or miners. And we would get these pretty large deals for young guys building mini data centers. And we went to some unique places, went to these places that were, they were moving from old school technology to this new, like, there was a big evolution in 2016, 2017 in GPUs. And we started seeing like a video come out the computer that was 10 times the processing power of what was originally there. So we were watching data centers actually be filled like Mac minis and these like consumer based computers.

39:01And the power was just so far beyond what the previous generation was that there ended up being all this space in data centers in 2016, 17, 18. And people were like, what do I do with it? I'm going to fill it with Bitcoin. And that was like the high level premise. They're mostly mining like altcoins like Ethereum or whatever, maybe. But we had a business doing this. I checked in in 2019. Dave and I kind of separated and he had started this company called Drone Blocks and they were building curriculums for drones. So he always stayed in the drone world. He got away from the crypto world. I was watching all these like guys I was working with become very successful in crypto.

39:36And I just couldn't understand like how they were leveraging the markets. I just was like a one plus one equals three guy. That extra one was my fee. Right. And I just wanted to like build it kind of like an evolution. So it always looks like I'm chasing these like what's hot. And I just believed in it beforehand. And I got my fingers in it before to play with it myself. And I never saw the bigger picture of what the enterprise value of these situations can be. So I'm speaking to Dave and Dave's like, hey, we're making these curriculums for drones. And I'm like, wow, that's really interesting.

40:12So you're building a curriculum on top of the DJI product and you're selling them to schools, teaching kids how to code and block code. Awesome. Love it. And he's telling me about how they have a part of their business that does ARR. And I'm like, looking, that's what people are looking for in enterprise value today. And I'm starting to understand how someone builds a company that's worth$100,$200,$300 million. And I'm like, all right, you have to be in a sector where you have high enterprise value. And it's always in the back of my head. So I get into manufacturing safety helmets in 2019. I started in 2018 and 2019 and I started this company building safety helmets just for natural use.

40:49That's it. I know this is like a total pivot off of like how the heck do we circle back to robots. I'll get it. So I'm looking at this new market in New York. We're based. My dad owns a construction supply store and I'm always like listening to him. He's like a he's a hardened entrepreneur of like this is what he does. He wakes up every day at three in the morning. He grinds and he still does his day. And he has a great construction supply store where I would get a lot of information about what's the new what are the new building codes? What's what's happening in the city? What's the new building going up?

41:23And there was a merge from hard hats to helmets. And and basically the helmet was 10 times the price of the hard hat. So I started having a manufactured overseas and we built a design to hit this new safety standard and we killed it. And the next couple of years, we became one of like the hottest safety helmets in the construction industry called Defender. And we competed with companies like Milwaukee and these big brands. And that between that and having this this extra cash flow, I imported whatever I could. And during COVID, we made a killing of leveraging our safety brand and coming up with all this more import export deals.

42:00So as I'm working on drones, Bitcoin mining, all this other stuff, I learned a lot about import export overseas. and I learned that there was this huge supply chain I could tap into and I started making contacts overseas and basically now I felt like I was this ultimate broker right and because I'm a detailed person I understand the language I understand coding I understand all these verticals I can start having like a fluid conversation with someone that needed something can understand the spec they want to develop to and I just kind of became a master importer and that really was the business.

42:31And I knew how to start working with like compliance and building my own brand at the same time. Like Defender, we had entered in the Inc. 5000, send our tax returns and everything. And we were the number one fast growing manufacturing business privately. I never took a dollar for it. It was all money that I was constantly, I'm going to use the word hustling lightly, but like I was always just grinding to get the funding I needed from businesses that I can start myself. So I would take whatever. So I hit up Dave again. It's 2021, 2022. And Dave's like, Hey, I need you to check out this company in China right now.

43:04This it's called Unitary. And I'm like, really? I will. Let's, I love drill. Let's get back into this. Like, let's circle back. I had, I had some money and I said, look, I'll put up a million dollars. I would love to get into this. I believe in it too. And he thinks I'm crazy. He's like, dude, I just want like a couple of these things to start working on so we can build a curriculum so we can sell it to schools. And I'm like, listen, I think it's just going somewhere. So I start looking online, researching of all these new companies that are getting started in the robotics space. And I always love my domains.

43:36I have like hundreds of domains stuck in GoDaddy accounts. And RoboStore was just the name I came up with. And so I think it was 2021 or 2022, I bought the name RoboStore. And I tell Dave, I go, Dave, I will import these for you. I'll bring them in and we'll get all these different versions. I started to talk to Unitree and they needed like a representation in the United States. They didn't have any product here yet. But Wanchin Shin had just started coming out with a robot dog called the Go One, the Quadruped. And there was all these different verticals of the Quadruped. There was ones with development packs on it.

44:09There was a consumer version. They had one for law enforcement. And they were really like, they were rough. But at the same time, they were consumer-based robots that you could actually go and we could build block coding curriculums on. So we thought it was interesting. We saw it as just a curriculum project for education. So we thought K-12 schools can start using a Go One with a curriculum pack on it. Dave would make the curriculum, his company would make it. I would sell them the robots and we'd have RoboStore.com as this big funnel of trying to get schools and recent development labs to start buying these robot dogs.

44:38Once again, we never see the bigger picture of like, wow, this is a robot evolution company. And that was really like the infancy of RoboStore.com. Now I pushed it and I started putting a lot of advertising in 2023 because now I have 150 quadrupeds in my warehouse and it's just me. So I'm talking to Dave about, Hey, what's your team looking at? Like developing on these things, where are we going? And he's like, dude, this is more complex than we thought. There's a lot that can be done with this. So we're starting to play with our own quadrupeds and seeing like, wow, we can do inspections on these.

45:15We can go back to the drone days and start like outfitting payloads and thermal cameras. And like, what else can we do with this robot dog? Obviously, the thought of a humanoid, we're getting tidbits from Unitree. They're working on like the H1 project. But we have this really close relationship with Unitree. And at the same time, we're building this education vertical. Funny enough, we start selling to hundreds of universities. And the first year we sell over a million dollars. These things flush out our inventory. By the way, the million dollars I thought I was going to put up at the time, Unitree didn't even have enough production power.

45:47So I think we got about four or five hundred thousand dollars of robots we didn't actually finish the whole po because they just needed to get them over and start pumping them into the u.s market because they're like look they're selling in china and we want to see what you guys do with them we're so excited to have this global expansion there was no real political you know uh world of robotics now this was just like this was just a small company in china who made a really interesting product with a way to develop on top That was it.

46:18Teddy Haggerty: And that was really just how we got started. Well, Teddy, we know that you're obviously bullish on humanoid and legate robots. I want to ask you, you know, you've been seeing it as what the drones face. You've seen it evolve. You've seen it grow like gangbusters, both in terms of interest, but also in demand. Can you tell us a little bit about, you know, the industry robots or humanoids in general have been selling largely into academic and R &D institutions? but there is increasing interest in putting them in warehouses and factories. What does that market look like? Is that maturing fast? Are you selling into those spaces or have you sold into those spaces already?

47:00Yes, but the actual deployment of what we've done is a totally different story. So when we launched and we pushed out the company, 2024, we didn't really sell much. And that was because people started to see that there was an evolution towards this humanoid. So people started to say, wow, I see this product that looks just like me. I have this interest of like, wow, what can a humanoid do, right? And 2025 hits and we launched a humanoid with Unitree. We do it at CES. We start pushing and boom, every manufacturing company, every Fortune 500 floods our inbox. And they're like, what can I do with this today?

47:35And at the time, we're like, look, we're working on this curriculum to teach you how to code this thing. But the fact is, there's not much you can do with it. So the whole market ended up becoming R &D. And even today, almost two years later, the whole market is R &D. That's the core of it, right? Like every company is trying to figure out what they can actually do with these products. And that's something I think it's lost in translation because like we still haven't taken a dollar from venture capital or anyone. We've been bootstrapping this thing since because I believe in it, right? But the fact is there is this huge interest in manufacturing.

48:07There's this huge interest in humanoid use. And what we've learned by selling to these research institutes, universities, Fortune 500 companies who started their offshoot of a R &D lab, that there's so much more to it, right? There's so much more they're still learning. And they can't quite understand what exactly they want done with a robot.

48:29Teddy Haggerty: And are you developing that curricula or, you know, in terms of the IP around selling into the educational market? How does that work? Do they come to you and say, OK, we've got this program, but we need a platform to work with? Or are you like, OK, we can also help you with that side of things? So we created an LMS system that integrates right into the college curriculum. Right. So it also works in like high schools, but we make it so we have different levels of it. And basically, when you purchase a robot, by the way, we've segued out of this business. We'll get that later when we start talking.

49:03But when we got started and even to last year and the last couple months, you buy your curriculum with us and you buy a package of your hardware. And the two together allow you to basically get your students up and running as if you're teaching a class. And now your students have a whole video series. They have all the PDFs, text boxes, everything that they need to know about how to actually start programming these robots. And that's really what the curriculum was. We had to build something to a level that could be taught at MIT and Stanford, but at the same time could be digestible from someone who just has a coding background and could pick up a robot and start developing on it.

49:38So we call that Robo University. So robouniversity.com is where we actually advertise our curriculum service. But it's not just schools that will teach curriculum. The curriculum has an LMS system that is really simple where you could be a Fortune 500 company and your robotics team that's looking to develop on it can subscribe. And you can get all this back-end data of understanding actually how to run basic programs on your G1 or whatever the product may be. We have curriculums for all the products, by the way.

50:06Teddy Haggerty: That's really interesting to note because while obviously I've seen a lot of these robots, particularly Unitree's robots at trade shows and the like, understanding how they're actually being used is really important. And obviously that's part of some of the news in the past couple of weeks, right? I mean, Unitree filed for an IPO, can bring its valuation to$900 million. But there's also a little bit of a backlash brewing. The FCC recently announced a restriction on new advanced robots. We wrote about it that it seems that it's mostly aimed at Chinese imports or robots. and Unitry is one of the most successful manufacturers of humanoids to date.

51:00Teddy Haggerty: Does that affect your business? How do you look at this, whether it's reacting to the initial announcement or does that affect your game plan? So I actually, it just fast forwarded everything for us. So our game plan over a year ago was starting to figure out how to localize robots here. And we knew we had to start becoming agnostic to just being a unitry distributor and developer and building these pilot programs for companies. We knew this was coming. I think from my perspective, we've taken this time to work with the unitry product and all the companies that we've worked with to provide them this training.

51:38And we've done a bunch of pilots with companies like Fortune 500. So showing them like, here's a build on top of this thing. But this is like a prototype. This is not something you want to roll out like thousands of tomorrow. this is really just like let's see what this can do and it'll run for days but it's not going to be something like you want to be like a real firm product to be bulletproof right the commercial grade what we've picked up from all that is the robot industry is almost jumping years and months so since we also own a developer group with over 4 000 developers um and they get to talk on discord of what they're doing in robotics and what we found is like what they're doing is now being published maybe a month or two later by these larger companies like the figures, Aptronics, the guys who like built a core business of saying like we're going to make human noise in the United States, they would kind of say, hey, look, this is what we're working on.

52:29We're working on like a robot that could open up drawers and fold your laundry and become this great use case theory. It's amazing, right? But we're noticing out like we're just starting the infancy of like programming robots to do these basic tasks. So we knew that a year ago, if we want to stay in this business, we can't be selling just computers that you develop. And that's what a robot is. It's a computer with motors attached to it that you code the computer, the motors end up telling themselves where to go and how to move. And now you have a task created, right? And you can achieve that task.

53:04That's the theory of robots, right? And we had to figure out how to take that simplistic method and just bring a lot of it to have the cybersecurity stacks, the operating system, and any sensitive data like brought to the United States. So the FCC, the new, I guess, regulations that they came out with, right? They're unique, right? It's not like FCC is the governing body all the time for what we can and cannot do when it comes to electronics. It's more of a communications body of watching sensitive information. We knew that there was going to be something coming out and we started this project a long time ago so we launched robo inc and you guys covered it is that was something that we were planning for a while and this is the first time we're actually not so keen on selling our our current stack and how we sell products today and selling robots and selling the curriculum selling development packages and all that stuff we're now fastly pivoting to localizing a few solutions here that are not just a humanoid we don't want to make an all-in-one humanoid.

54:06We don't think that's the way. And what we've done is we've taken the last couple of years and we've taken all the data from these companies and we've asked, what are you doing? What are you guys up to? MIT lab, what are your kids working on right now? We want to know, right? Like we got so much information to say, these are the solutions that are really important and we think could be launched now. And we pivoted to selling a solution. And I could get more into that, but a lot of that is manufacturing. And I think the difference is like this FCC ban on foreign quadrupeds, humanoids. This is actually something to really just push companies like ours to say, get your shit together in the United States and start globally sourcing everything.

54:51So we're not totally reliant on this Chinese technology because that's where most of the products coming from. It's not that they're inherently bad. It's just that it's scary, right? It's scary to someone in the public. Like you have a human in your house holding your laundry in theory, right? Because I think this stuff's further away than we're saying it is. But that's something else. Like you're going to have this product that's made in China and your house now getting all this data on you. That's the scary part for the consumer. That's why they did it, you know? And it seems like the right way to move is saying, how do we take all that and the security part and the data and the cybersecurity and the sensors and the cameras.

55:30And we all would make sure none of those are going to foreign countries and we keep that here. That was really what that ban was about, in my opinion. So let's drill down on the RoboInk announcement. I think it's interesting for you to share that you saw something like the FCC ban coming or at least sort of bringing more of this content into the US. So what's your vision for RoboInk? Because even though we covered it, I'm not quite sure where to categorize what RoboInk is. Are you a systems integrator? Is your vision to begin to build on top of a unitary platform and or other platforms to build the system?

56:17As you said, the solution, let's talk about solutions for the use cases and opportunities you've seen in your customer base, be that applications in commercial settings or consumer settings in the future somewhere down the road. Just talk to us about the concept of what RoboInk is so that we can categorize exactly what you're trying to do here from somewhere in that spectrum of being a manufacturer, being a systems integrator. and always at the end of the game is we've learned solving some customer problem. Yeah, and that's something too that matters to me of sharing like the ethos of what we're trying to do because we're not a public company.

57:00We're not a venture-backed company. We're not a company that we've wanted to share news out there. So when we pushed like pushing out press releases on RoboInc, it was to start showing people, hey, this is what we've been working on, right? And we're looking at now raising funds and now becoming to a larger growth-based business. But we're getting away from a hardware sale to software creation business that was like, as we go, we're like flying by the seat of our pants because everything's moving so fast. So we're like, hey, we believe in these four pillars that we can start selling tomorrow. And we want to just get robots into the atmosphere.

57:36Let's get them here. So that's what RoboWink is. It's a manufacturer and it's an integrator at the same time. And I can get, I'll give you the understanding. So we get hit up by every robot company wanting to sell their product into our distribution. So by imports and what I can track online, we're the largest import in the United States of quadruplets and humanoids. And we've done that with one brand since. So it was, it was unitary. So we have, we have a lot of people that are buying from us. A lot of people are learning from us. A lot of people that give me understanding of how their large company is integrating robots.

58:09robots and four things that we've come across time and time again. And I get about 100 to 200 inquiries a day sometimes of just people asking for how to robot, how to bring a robot into their house, business, whatever it may be. So we get a lot in health care. We get a lot for security and patrol. We get a ton of education. We're selling a lot of education based products. And then we have local businesses. Those are like the four pillars of where we see over and over and over again a solution being wanted. and willing to be paid for today, right? To the point where like, we have some customers who have been really patient and actually worked with our developers and we've allowed them to, to develop maybe like a concierge robot for their business.

58:51But we don't really supply that on our website or talk about that. We've just gone into a conversation with someone who's really interested and say, hey, do you want to pilot this? Like we'd love to do this at your retail store and show it off and you can, you know, go out there and advertise it. So we found these four pillars very interesting because if you take a humanoid and you put into healthcare, we necessarily can't get the perfect product for what we think is a healthcare robot that can be deployed tomorrow, right? So we had to take all of these pieces that we've got from partnerships or smaller companies are out there making a sensor and then put them all onto a robot, make that robot agnostic from one manufacturer like Unitree.

59:29Now we have to source everything ourselves from the architectures from NVIDIA. We have to figure out where we're going to get motors from. And we have to also be kind of relying on a chassis creator who's got the injection molds and and it's got like the blueprint down for the base of the chassis they're working on so a lot of companies that you see that come out robots like uptronic you know i can see just by their their product their humanoid they're sourcing a lot of those parts from other manufacturers right now and they're putting it together almost like an ibm computer or an asus computer right like that's a really they're they're putting together a computer of all different parts to then be under their brand and the interesting part is when we started figuring out, well, do we just manufacture a humanoid and do we just manufacture a quadruped?

1:00:11And those are our two products. We kept coming back to that product does not fit these four solutions very well that we get over and over questions about. So we've created four robotic products that we're, we've had in prototype stage. Now we're trying to put into production stage and they're four products for healthcare, security, education, and small businesses. Small businesses is a hybrid of a humanoid where it's got a base on it and it's basically our prototypes based off of G1 right now. And we've modified the head and we've resin printed it in house and made this, you know, quasi prototype of a concierge.

1:00:44So we have a backend that we work with and bought and they basically built out. So as a small business owner, you could tell everything about your business and say, Hey, my business sells like my dad's business, construction supplies, nuts, bolts, screws, and safety equipment for construction. I can give you all my catalogs and give you all my data. Now, if a customer goes off to this robot and says, Hey, hey, I'm looking for this pen or this screw or whatever. The robot can go to the catalog just like an AI and now it can give you this human interaction. And we made it as a robot as a service where we charge businesses$2 ,500 a month to integrate that robot into their business.

1:01:16And it's something that they can start having today, right? Is it gonna do all the work of their other team members, employees? No, but it's gonna be something that we start getting the behavioral aspect of robots into the ecosystem. Seems so simple, but it's deployable today. And then for our security product, we actually have some big like Fortune 500 pilots where we have prototyped a security quadruped. And everyone wanted a humanoid. We said, no, quadruped is the way to go because we could stack the right payloads on it. And we had to modify a base originally on a go to B2 and A2 product. And we had to rip that all apart, put our own routers on it and our own LIDARs and our own thermal cameras and everything.

1:01:56Now we had to work on safety. So we had to have e-stops and create and in lights and all the safety stuff where you want that product in the atmosphere, which no one thought of when they're making a humanoid or it's kind of strange, but the safety part's a big part. Put that together and that's a security solution. And it's simplistic, but it's hard for me to sometimes explain how simple it is to actually build one of these products, but the hard part is doing it in mass production. And we can build a hundred of them, we can build 500 of them, but then the demand that's out there is in the trillions.

1:02:28and our business model is kind of like salesforce robots integrators below us but we give them the training and the hardware to sell into businesses where they already have relationships who want to integrate robotics and that's really how the top-down approach of what we believe is the next like expectation of robots really is there like the expectation of i want to see robots in the world and not just walking around and doing these entertainment and dance and and all this cool stuff that's all shiny, but how do I get a robot to do something that actually helps me? Yeah, it's a good analogy. And I think maybe based on your experience with your dad, which you said influenced your career in terms of watching his entrepreneurial spirit of building for construction.

1:03:15Could it be a similar analogy to what you're doing with Robo Inc? For the construction business, people buy a flatbed truck and then they outfit the truck to fit their business, whether I'm a plumber, whether I'm a, whether I'm a, you know, doing welding or whatever, right. You are taking some OEM based products like the Ford chassis for a flatbed and you, then you're outfitting it for the task. In that sense, you're, you're OEMing the, the, or white labeling the underlying product, reconfiguring it, outfitting it for the task at hand, and then your business then reselling, supporting, training, educating your end users.

1:03:58And that's sort of the classic integration business that, you know, industrial robots used for decades, right? Correct. And I think a lot of it comes into the fact of, like, when we have these conversations, what's most interesting is humanoid to people. So a lot of people get lost in the humanoids and they forget about all the robots that now have been brought to the market or have been around for 15 years that actually help with manufacturing production. So, like, I'm sure you guys have seen a huge uptake on your socials since humanoids have launched. Right. The amount of advertising, you know, your website has achieved has probably been multiples over what it prior was before the humanoid launch, because now everyone's so intrigued about this humanoid.

1:04:42Right. So what matters about that is there's companies like Universal Robotics and Standard Bots, and they make robotic arms, which are so helpful and can do a task today. But they were undermined prior until the until the humanoid came out as a launch. So what what we're like, our ethos is like there are these robots out there right now, like a robot vacuum that works great in commercial setting. But people have deferred to not really be so interested in that yet until they saw a humanoid doing the same task. So like humanoids came out and they were this amazing advertising platform for robots.

1:05:21So what we're kind of doing is simplifying what a humanoid is supposed to do and telling you, look, we have this integration model. Exactly. Right. So we have like a Ford truck that we have put a bucket on. You can use for, let's just say, servicing telephone wires, right? That's a chassis, but it's another company that makes the whole system work, right? And that's all it does. It does that really well. And that's what you use it for. And for us, we're looking at the same thing in robots. Like, you want this all-in-one humanoid. We don't think that's realistic. We got to start with something that's, like, built for a specific reason, like a robot arm, to go pick one package and put it here.

1:06:00It may not be as sexy as a full humanoid, but the fact is it can be deployed today. So our four solutions are really from manufacturing to integration. It's like we have to do manufacturing. So it's not just full, just building on a chassis. Now we're required to make the chassis because of these new laws and what we have to watch from data storage. So it's a lot more intricate than that, right? But your analogy is correct. And then there's dealerships underneath. And our way of the dealership approach is these integrators where they've been, they are able to share their revenue in this robot as a service plan that we have to basically get robots in a much lower cost instead of having like$100 ,000 robot, you know, baseline price.

1:06:43It's like$2 ,500 a month,$4 ,500 a month for our integration into their business. And then sharing that with companies that are doing this right now and data and software. like Salesforce. If you go to Salesforce and you say, Hey, I want to have Salesforce for my website. They're like, all right, here's the integrator that you go to. And they're, they're specifically your niche. You don't go to Salesforce for them integrating on your business. They tell you a software stack. Then there's people that are specific to integrating into that niche, healthcare, construction. They make Salesforce for construction.

1:07:16And that's how we feel the robot ecosystem has to evolve. And I think a lot of companies have jumped the gun on becoming an Apple right away without starting at an IBM.

1:07:25Teddy Haggerty: Well, and I remember that in my previous career, that's the migration that I covered, in fact. So let's talk a little bit about the building out the custom software side, because you've gone from reselling robots to tearing them apart to providing them now for specific use cases. Can you explain the growth of the software side of your business? And what are you aiming for in terms of, are you building out a development team and what are some of those infrastructure type challenges that you're addressing? So since January, we've started building out a much more advanced engineering team. We have an engineering part of our warehouse now where all they're doing is taking apart robots, looking what's under the hood, and then figuring out how to develop software on top of them.

1:08:18And one of the biggest problems we have is autonomy. So we've spoken to a lot of companies out there who like make an autonomy stack and what we're finding out is no one has like a one-size-fits-all approach which kept bringing us back to all right if we want to manufacture this robot we have to go we have to go solution specific because autonomy is a big issue so if you're talking about autonomy outside versus autonomy inside two big two big differences right um you want to have the option of gps and you have all these other sensors that work to basically make your autonomy package better so autonomy is a big problem right now and i'd say like as a general statement the hardware that's available in robotics today is way more capable than the software that's out today and that's integratable um and that's that actually stems back to a big problem that we see across the board is like there may be a company like figure there you know they've built this mammoth of like a ground-up humanoid robot that can do so many tasks so they've had to work on like autonomy and operating system they had to work on all the actual like locomotion inside and they had to build it from scratch and start deploying that.

1:09:23There's not a lot of companies working together right now to take one part out of the equation like there was in the infancy of computers. So when you had an operating system like Windows, you'd be able to plug it into your machine like an IBM and then build on top of that operating system and then make the hardware separate. And then NVIDIA would make your GPU and AMD would make this and Intel would make your chip. And a lot of robotic companies are putting this like really extreme valuation and pressure on themselves to do everything themselves. And when we try to communicate and work as a partnership with a lot of other companies out there, our claim to fame is like, hey, look, we've deployed more robots than anyone that we've known.

1:10:02Right. But and they've heard of us. But why don't you want to just integrate this into our robot? It's like, well, well, well, we're thinking we've built this whole stack. And it's like, all right, you're taking on a project that's so large. And what we've had to do is we've had to bring engineers in-house to almost make it ourselves from scratch. So building our own operating system, we call it RoboLink. We've had to start working on our own autonomy system. And that's been like a weird thing about this market is everyone is putting so much pressure on themselves to have a multi-billion dollar company today and prove that their company is worth like Apple.

1:10:40And I think that we should be working together more to figure out how we take little pieces off the chain and put them all together and make an IBM, make Apple prior 2021. I tell everyone this, Apple never put their own chips in their computers until 2021 for consumers, right? The M1 chip came out and that was like a big, that was a big thing because it was optimized for Apple computer. Prior to that, what did they use? NVIDIA. They used Intel, right? You had an i7 and the best MacBook Pro with an NVIDIA graphics card. We were always a modular industry, and that's a big problem with the robotics industry.

1:11:13Teddy Haggerty: Well, the other thing I wanted to ask is, you talked about the B2B space versus the B2C space. And obviously, we're also somewhat skeptical of the idea of a humanoid in every home in the near future. We've certainly seen the opportunity for robotics, more public-facing robots, certainly. But do you have a sense of the timeline for this? Honestly, I think robots in the home at a consumer level are at least five years out. Yeah, that tracks with what we've heard from people in the know, right? I mean, there are people making a lot of promises. but just seeing that and there is still incredible progress being made in humanoids and semi-humanoids and mobile manipulators and all kinds of applications but and i think we are more likely to see them in like restaurants or airports before we see them in the home but even that is still a pretty big lift what do you think is the biggest hurdle to to get into consumer deployments?

1:12:18Is it capabilities, costs, safety? What are some of the things that raise your alarm there? I think we haven't had an infancy stage. So there's so much pressure, like I was saying. We're in a weird position, right? So we had to put this Roboink launch because that was the way the market was going, right? But we learned a lot. Some of my first customers were companies that are worth billions of dollars. And like Skilled AI, we were selling them GoOne education models in 2023. And now they're worth$14 billion evaluated company, right? And that's a lot of pressure. So I think what's happening is like the last time we saw this to like the economics of the scale of robotics was the dot-com bubble.

1:13:01And they were all right, right? Like 10 years later, these companies were worth a lot of money. And the fact is like the guys who rode that out and had a good company, like Amazon, he had a good company. He was selling stuff. His metrics were going up all the time. He weathered the storm. So I like to say that we're really unique, right? Because we haven't raised any money. We've just weathered the storm over the last couple of years and we're in our infancy. No one cared about robots till 2025. That was only 18 months ago. So what do you expect to be achieved in 18 months? And also like companies like NVIDIA, they're making software like Root that is making training robots way cheaper, right?

1:13:45And it's way faster. So some of these guys that raise money early on spends all their development money at the time on training these robotic models. And then NVIDIA comes out and like, hey, we just made this over here. Why do you need to do that, right? So like, let the thing be an infancy stage for a little bit. So when we talk about the solutions that we have, they're not something that's gonna be changing the world tomorrow, but they get robots out there and they allow robots to be accessible into industry. Why do we have to go straight to consumer? Because it's the biggest market out there.

1:14:14And I think what's sad is like the AI ecosystem is just such a high dollar value that people are looking at it and going, well, my company can work$10 billion. That's a big company, right? So it's a lot of pressure on these robotic companies. And I don't blame them for giving these like advantageous and ambitious goals of like we're going to put a robot in every home and they're going to do your laundry and do this and this. because they got a trillion dollar market to live up to. So when we sit here, sometimes I talk to our team and go, what the heck are we doing wrong? Right. And I'm like, from what I know, I'm looking at all these parts that they're working on.

1:14:52I got the same stuff. We're building. We could build our own humanoid from scratch tomorrow. But where are we selling it? Right. Where are we selling it tomorrow? And we've been able to build a market where we've been doing millions of dollars of robot sales. But the only way we've been selling them is because we've been offering support and training. And that shows you that that infancy market is there and we're trying to make it here. That's the issue. Yeah, well, you know, I think we've talked about a couple of analogies for your business. Here's Teddy where I think I see the brilliance in your business model.

1:15:21I live in the gold country of California where gold was discovered. A lot of miners came out here 1849 trying to get rich on gold. The people that made all the money were the Levi's and the people shelling picks and shovels, right? You've essentially started in the picks and shovel business, selling the robot systems for all these companies to develop their AI models. And you're just quietly amassing your fortune in that business. And so I think that's great to see what you're doing there. Before we let you go, I'm hosting, I'm moderating a panel at RoboBusiness here in a couple of months on the state of RAS.

1:16:02And I know that you're committed. We've heard you talk about selling in a RAS model. And I know you sell RAS, you sell CapEx, you'll deliver the system. However, the customer wants to exchange some value with you. So I'm curious from your perspective, because you seem like a data guy, how often do you think customers prefer to go through the RAS model versus buying capex in sort of the markets that you're serving today. Can you give me some sense then? Yeah. So I think this RAS model is a unique term that's only been coined in the last six months, right? Like what is it? Robot as a service, right?

1:16:40Well, I'll correct you right there. No, I've been covering RAS for a decade. No, well, the thing is you're in the robot business, right? So you get it. We have to look at like the financial terms of it, of like how people can accept it right now. And I also get it as like a lease model, right? If you're talking about a car, right? And people look at the payment of what it costs to get a robot into their industry. And then they see that like smaller dollar. They're like, okay, I'll take that risk, right? Worst comes worst. I hate it. And this is what I risk. I think the model has to be developed further because there's so many other pieces to it, like data usage.

1:17:15So obviously when you're running these complex AIs, you're using a lot of tokens, like on open AI, to basically have the actual robot do what it's supposed to do. And people don't realize too, all the computing power on this robot is not being done on the robot, right? NVIDIA is amazing at coming out these new computers. The Thor, the AGX, and the Jetson, and the multiple of how that computer is running is now getting to the point where you can run a local LLM pretty fast. But when we're piggybacking back to data centers to go get that extra power to run an open AI model or to run a DeepSeq model or a Claude, whatever, using, that's a cost.

1:17:52And that cost also comes into the RAS model. So we have these economics that we don't yet know about on actually running the robotic platform. And no one actually has a sense of how much data you're going to use based on the performance of that robot. So our RAS model is that's why we had to put our customers in a box. Like this is what the robot does. It doesn't go outside the box. So we can basically coin of like, all right, this robot would maybe cost$30 a day of data transfer, and we're going to basically build it into our model of our monthly costs, right? So I think where people are also confused is the robots right now rely heavily on networking.

1:18:32They're not so much built on the chassis that they're on, and they have this supercomputer that's a data center built into the stomach of the humanoid. So the RAS model is going to be very unique to see how it plays out when robots actually go in industry and then consumer, because we have to see how much data we're actually utilizing over the air. And that data costs money and the GPU power costs money. And now you have to you have to see is your robot going to cost you an hourly rate? And is that going to be comparable? Is that going to be something that you now don't want your robot doing so much stuff?

1:19:06It's costing you more money like that. that model has a tweaked hardware costs and data costs. And I think we're not yet there to figure out how the economics of that truly play out. Yeah. I guess you bring up a good point about the future with AI based systems in our, in our robots as a service model, because, you know, the kinds of SLAs that are associated with the contract, right. What are your thoughts there on, on, you know, of the types of SLAs you're putting into your REST contracts for customers? Is that evolving as well? So coming back to my point of keeping customers into a box, we have to make sure that everything that we're allowing, the sensor, the data, and everything to pull in is just to what the robot's supposed to have as an output.

1:19:57So for instance, if we have a security robot, right? What we're running on top of that stack is a lot of stuff is removed and it's just supposed to do a one trick pony. And a lot of the data going back and forth and running that LLM that's got to be more towards an autonomous security robot. We haven't had enough data with customers to understand how that contract's actually going to work. So we're putting whole figures on the economics and we're basically really estimating of like where it's going to end up. And one of the problems that I have is like six months ago, we saw a higher, we saw higher costs, right?

1:20:36And that was only six months ago. What's changed so much in six months? What changed in a year? The robot industry is moving so fast at these like hyper rates that we don't know if tomorrow, you know, NVIDIA is going to launch a software that's going to make, you know, what we already had obsolete. And we're trying to make things more niche based. So we go through these economics all the time of understanding what the real cost is going to be. And we can't quite grab it because there's not enough data out there right now in demos. So that's where I kind of doubt a lot of these companies that are so large on where they're thinking they're actually going to place their monthly costs in the robot, because I don't think we really know the costs.

1:21:14And that's one thing that this pressure of these multi-billion dollar companies are putting on each other, just get product out there and make money. And now that's something that people have to rush and not understand the economics of the RAS model that's involved to now get these in the customer's hands. So we're going to make a lot of mistakes. And you're right. We have been patiently kind of letting things evolve because I kind of let the kids fight in front of us, right? And see who battles and wins. And then go, oh, I like that guy. Let's talk to him and figure out how he did it. So we're learning.

1:21:49I think that's a great mental attitude to have here in this business. You've got to be nimble. You seem to be nimble. You've got to be able to look for the white space, which I think you've got some intuition. You've demonstrated some intuition there. So it's been fantastic to get behind the scenes with you, Teddy, and learn more about your business and the arc that you're on. So we look forward to following your success here in the future. I want to thank you for coming on the show and sharing with us. And you'll come back when you make the next big milestone here, we'd love to continue to follow your growth and success.

1:22:27Thank you guys for having me. And thanks for letting me speak about this. This is a good foundation for us to understand our model. So I appreciate you guys.

1:22:39Yeah, great stuff there. I didn't realize they're Unitree's North American distributor. That's pretty crazy. So a great relationship there. So I wonder how much of the university sales and other sales for Unitries robots in North America go through RoboStore specifically. I think there's a few others, but I'm not sure. Well, I think anybody that's buying through North America, I mean, if you've got a connection to an international, there might be other channels in through that way. But yeah, anything that's going through North America and supported in North America is going through RoboStore. So a lot of folks who've bought, you know, are educational folks, probably familiar with Teddy and his team at RoboStore.

1:23:24Yeah, I think so. They do a lot with educational areas as well, which is great, right, to help their, we talk about this a lot on and off is helping your customers be successful, right? So it seems like he's kind of, He understands that part of it to try to help his customers be successful with whatever solution it is that they're using. But great stuff there from Teddy. What were some of your takeaways, Mike? Well, you know, I think, again, Teddy's a pragmatic business guy. I sort of have that takeaway. You know, he's already proven success at creating different ventures as a serial entrepreneur.

1:23:59And I also think, you know, this thing is building behind RoboStore and now RoboInc, as well as this concept of what I call a robotic service provider, right? A business built to take an OEM product, so they're not building the robot, but take an OEM product and then build a RASPS type model around that with all the services and SLAs and contractual agreements for field service support setup and training and all that sort of stuff that goes around it. So, again, that was my plea to anyone that's an OEM to have listened to understand, is Robo Inc. right as a partner or, you know, taking a similar adoption of that model, you know, to go forward as a robotic service provider for clients that want to, you know, buy it as a service.

1:24:50yeah speaking of robots as a service again mike's hosting a great panel about uh wrasse at robo business with the one and only rick falk from locus robotics maybe arguably the most successful wrasse company i think so yeah so far yeah i think that's fair to say so if you're uh if you're a fan of wrasse if you're not a fan of wrasse there's nobody better on the planet literally to learn from uh than rick falk the ceo of locus robotics so again he'll be at robo business. And again, a lot of other folks will be at Robo business, October 20th and 21st out in Santa Clara, California. We're aiming for over 2000 people, over a hundred companies on the show floor, our 20th anniversary show going to be a great time.

1:25:35And again, we wanted to pass along a special discount code for our loyal podcast listeners. When you're buying your Robo business tickets, enter the code ROBO15. That's R-O-B-O 15 at checkout and you'll save 15 % off your tickets. So again, that's just for you guys. We appreciate you guys listening and coming along for this journey, 260 plus episodes, which is great. So again, if you're coming to Robo Business, we hope to see you there. Enter the code ROBO15 at checkout. You'll save 15 % on your tickets. And if you have any questions about the show, reach out to any one of us here. Happy to set you straight.

1:26:13But again, head to robobusiness.com and we'll see you in Santa Clara in 30. I think when this comes out, Mike, 32 days. We'll see. Yeah. Wow. Yeah. Looking forward to that. That's going to do it. Episode 262 of the show. Thank you again to everybody for tuning in. Thanks to Teddy Haggerty from RoboStore for joining us on the show. New episodes of the Robot Report podcast drop each week. You can find us anywhere you listen to your podcast. Please subscribe. Leave us a rating. Give us a review. This episode was produced by Mike Oitzman and edited by Tyler Kubisti. Our executive producer is Amanda Buhner.

1:26:48I'm Steve Crow. Thanks so much, folks. Have a great weekend, and we'll talk to you again next week.