Jaka Robotics, a Chinese startup that makes collaborative robots, has just pulled in a hefty Series D funding round of over $150 million from a lineup of heavyweight investors to help it expand globally.
The round is led by Singapore’s sovereign wealth fund Temasek, TrueLight Capital, Softbank Vision Fund II, and Prosperity7 Ventures, a growth fund under Aramco Ventures, which is an investment subsidiary of Saudi Arabia’s state oil firm Aramco.
Collaborative robots, known as “cobots,” are meant to work alongside humans rather than in isolation. Based out of Shanghai and Beijing, Jaka’s robotic arms can augment humans in a range of tasks, from assembling electronic parts, pouring from a coffee machine to packaging smartphones.
Jaka plans to spend its fresh funding on R&D and global expansion, which makes Prosperity7’s investment all the more significant.
“We have the unique background to help [companies] to go global by leveraging the worldwide outlets of the Aramco ecosystem and our strong connection with Saudi with the Middle East,” Scott Cai, managing director at Prosperity7 who had stints at SoftBank and Baidu, told TechCrunch.
“Nowadays, Middle East is one of the major developed markets which also hold a very good relationship with China and many Chinese entrepreneurs trying to set their first foothold in the Middle East,” the investor continued. “We can help bring those tech companies into those markets.”
Jaka already counts Toyota and Schneider as its close partners, who are co-developing large-scale applications with the startup using its robotic solutions.
While Cai couldn’t disclose Jaka’s financial performance, he said the robot maker’s growth has been “very impressive” over the past few years. Overseas businesses currently account for “a material portion” of Jaka’s revenues and are expected to reach a 50% share in the long term.
Aramco in China
Founded in 2014, Jaka is exactly the type of tech startup that Prosperity7 looks for in China. Saudi Aramco has been in China’s oil and gas as well as chemicals market since the 1990s, and last year, it began deploying capital through Prosperity7 to bet on Chinese tech that can “solve big problems on a global level and generate huge returns.”
Jaka’s robots can do heavy lifting work that comes in handy for energy firms in the Middle East. In oil drilling, for example, rock cores are still being manually carried around for testing. “It’s not efficient at all,” suggested Cai, adding that robots can perform better in this type of work.
Companies like Jaka, which fits into China’s national goal of improving efficiency in its traditional industries, are coveted by many investors. Prosperity7 believes its ability to invest in the long game gives it a unique appeal to startups.
“Prosperity7 is backed by Saudi Aramco. We take a long-horizon view and establish long-term relationships,” said Cai.
Being relatively new to China isn’t a disadvantage for Prosperity7, Cai reckoned, as his investment outfit looks for opportunities in “disruptive tech,” such as industrial internet (China’s term for using advanced tech like smart sensors to improve productivity in industrial production), robots and medtech.
Large USD funds operating in China have focused on the lucrative consumer internet space for the past two decades, during which the likes of Tencent and Alibaba gave rise to an internet boom. Many of them have also started looking at semiconductors, autonomous driving, and other cutting-edge technologies, but they, too, are new to the field.
Cai also seems unconcerned by the current economic slowdown in China, saying “it’s normal to see the ups and downs in the market.”
“We still believe in the long-term trend of technology progress in China and more and more world-class companies will become winners from the China market.”