- Autonomous delivery company Gatik raises $25 million Series A.
- The startup is partnering with Canada’s largest supermarket in the country’s first autonomous delivery deployment.
- Gatik CEO: Canada’s AV regulatory environment is “well-structured and progressive.”
Gatik, a Palo Alto, California-based autonomous delivery technology company, announced on Monday it has closed $25 million in Series A funding.
The round was co-led by Wittington Ventures and Innovation Endeavors, with participation from FM Capital and Intact Ventures and existing investors including Dynamo Ventures, Fontinalis Partners and AngelPad.
Additionally, Gatik announced a multiyear partnership with Loblaw Cos. (TSX: L, “Loblaw”), one of Canada’s largest grocers, to deploy a fleet of autonomous delivery vehicles in Toronto. The vehicles will deliver items from the supermarket’s automated picking facility to retail stores across the metro area.
“Retailers know the biggest inefficiencies in their logistics operations often exist in the middle-mile,” typically between picking facilities and retail locations, Gautam Narang, Gatik’s CEO and co-founder, said in a statement.
This niche is “where Gatik lives and succeeds,” he said. “We are delighted to partner with Loblaw in addressing this critical piece of their supply chain.”
The middle-mile niche
Founded in 2017, Gatik has been using its robovans to move groceries for Walmart and other retailers for a couple of years.
Its middle-mile sweet spot targets routes between distribution centers and retailers, an increasingly crowded space as a surge in e-commerce compels shippers to add more distribution centers closer to urban centers.
The Loblaw partnership, which follows the completion of a 10-month on-road pilot in Toronto, marks Gatik’s first foray into Canada and the country’s first deployment of autonomous delivery vehicles.
Starting in January, the startup will transport hot and cold goods from the grocer’s automated picking facility to retail stores across Toronto. It will operate five vehicles up to seven days a week, 12 hours a day, on five routes operating on public roads with fixed pickup and drop-off locations.
Gatik does not build its own vehicles but equips Ford Transit 350 box trucks with refrigeration units, lift gates and its autonomous self-driving software. A safety driver is behind the wheel at all times.
More activity, more competition
The past six months have seen a spate of commercialization and deployment announcements in the autonomous trucking space. To wit: TuSimple is building out an autonomous freight network; Daimler is partnering with Waymo on an autonomous Freightliner; and Plus Level 3 autonomous trucks will be available next year in China.
While these developments revolve around the long-haul market, Gatik does have some competition in the considerably less crowded middle-mile autonomous sector.
Notably, Swedish trucking technology startup Einride made waves earlier this fall with an announcement that it was putting its remote-operated autonomous electric trucks on the global market starting in January 2021.
The company expanded into the U.S. this year and to date has focused on short-haul routes between distribution centers.
Gatik will use the financing to further expand operations across North America, its team size in Silicon Valley and growing presence in Canada.
Although the commercial market for autonomous vehicles in Canada is “less mature than it is in the U.S.,” the regulatory environment, specifically in Ontario, is “well-structured and progressive,” Narang told FreightWaves.
He cited, additionally, Ontario’s high-quality universities and vibrant technology talent pool, saying the company “saw an opportunity to establish roots in a new and emerging market, which is very favorable to autonomous vehicle deployment.”
Reliable perception still a nut to crack
Responding to a question about lessons learned from the Toronto pilot, Arjun Narang, who is Gautam’s brother and Gatik’s CTO, said that operating a fleet of vehicles in Canada “through the extreme winter conditions has enabled us to capture and test for unique driving conditions.”
This includes gaining a better understanding on how snow, rain and ice affects vehicle movement, as well as making progress on varied weather conditions “in our operational design domain,” Narang said.
The Loblaw partnership, he added, will give the Gatik team additional data and experience to improve truck operations in different environments.
To date Gatik has raised a total of $29.5 million and has completed over 30,000 revenue-generating autonomous orders for Fortune 500 customers in the U.S. and Canada.
Retail customers who previously had to wait for order fulfillment once every two days now have their orders filled once every two hours for a 24-fold increase in efficiency, the company said.