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Daimler Invests In ‘Last Mile’ Robotic Delivery Startup

January 12, 2017
Wall Street Journal
by Cat Zakrzewski

Some of the world’s most valuable companies are racing to remove humans from parcel deliveries.

But one U.K.-based startup is already commercializing ground drones that can carry packages or food right to a customer’s door.

Google parent Alphabet Inc. and Amazon Inc. have highlighted air-delivery potential, with recent tests that included delivering burritos to college campuses and video-streaming devices to customer’s homes. But Starship Technologies and other startups are exploring the potential for drones that travel on sidewalks and roads, allowing deliveries over short distances.

Auto maker Daimler AG has led a $17.2 million investment in London-based Starship Technologies, with participation from Shasta Ventures, Matrix Partners, ZX Ventures, Morpheus Ventures, Grishin Robotics, Playfair Capital, HOF Capital and several other investors.

Starship co-founders Ahti Heinla and Janus Friis, both former Skype executives, launched the startup in 2014 in Estonia, where engineering teams still are based.

It isn’t Daimler’s first foray into drones and autonomous vehicles. Last year, the company took a minority stake in Menlo Park, Calif.-based Matternet. The companies joined forces to create a van that would carry airborne delivery drones that would be driven to a neighborhood and then fly parcels short distances to their destinations.

Daimler will embark on a similar initiative with Starship’s sidewalk drones. At the Consumer Electronics Show in Las Vegas last week, they presented a “Robovan” prototype, which would transport a batch of drones to a location where they can fan out to take packages the last mile of the delivery route.

Starship’s drones look like futuristic wagons. They can deliver up to three shopping bags worth of goods over a three-mile distance in about 30 minutes.

By focusing on ground delivery, the company doesn’t face as many regulatory hurdles as drones that travel by air.

“We have a lot more operational freedom because, in a number of countries and U.S. states, we are completely legal and do not need any laws or regulations to be changed,” said Mr. Heinla, its chief executive.

The company has started commercial pilots in Europe, with customers like food-delivery service Just Eat.co.uk Ltd., Hermès, Swiss Post and Wolt Enterprises Oy.

Mr. Heinla said the company is planning U.S. pilot programs in the U.S. in Washington and Redwood City, Calif.

The funding round closed in December 2016. Last year a competing ground drone company, Dispatch, raised $2 million in seed funding from Andreessen Horowitz.

Daimler Invests In ‘Last Mile’ Robotic Delivery Startup

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