Singapore-based kitchen robotics developer Zimplistic is on track to raise a Series C funding in excess of the $15 million it raised in its Series B round in 2015, a top executive with the firm told this portal.
“With demands for innovative kitchen appliances globally, Zimplistic has achieved over US$20 million in revenue in its first year of sales, and we have expanded our presence in a total of six markets since the launch of (smart flatbread maker) Rotimatic in 2016,” Rishi Israni, the chief executive and co-founder of Zimplistic Inventions, said in an email interaction.
Rotimatic has attracted several investors, having raised a total of $20 million in both Series A and B, and its cap table includes the likes of NSI Ventures and Robert Bosch Venture Capital.
“The Series C round will be significantly larger than the previous rounds raised by the company as we look to expand into new markets in 2018,” Israni added.
According to information compiled by Crunchbase, the startup venture raised a $500,000 angel round in December 2010, followed by a $3-million Series A round in March 2012 and a $15-million Series B round led by NSI Ventures in July 2015.
Zimplistic was founded by Israni, along with his wife and co-founder Pranoti Nagarkar Israni, the chief technologist behind Rotimatic, in 2008.
According to Israni, the startup has been talking to existing investors, alongside venture capitalists and private equity players that conduct growth capital investments in Southeast Asia, India and Silicon Valley.
Asked about his growth strategy for entering the Middle East and establishing a presence in India, whose wage structure may not be favourable to robotic solutions for the household, Israni said: “Every new market has a unique culture and demands to address – Middle East and India are no different. The challenge is working towards targeting the right demographic with the right messages, as a cookie-cutter approach will be ineffective in engaging the right audiences.”
As for an exit through an initial public offer (IPO) or buyout, Israni said he was currently focused towards building Rotimatic to be the category leader and capitalize on its first mover advantage.”
Zimplistic Inventions, with its Rotimatic device, is among the few hardware startups to emerge out of Singapore. Given recent inroads in the manufacturing space, advances in artificial intelligence (AI), automation and robotics may also see the city-state strengthen its role as a hub for niche, high-technology manufacturing.
“Singapore and with its connectivity to the region has great hardware expertise advantage with people who have immense experience in building and scaling hardware companies. You need high efficiency, integrity and quality of hardware in the early stages till things stabilize as mistakes here can kill the company. I believe a model that works great is to have R&D here [Singapore] with manufacturing in the neighbourhood, before scaling it to locations that are nearer to the target market,” Pranoti, the firms chief technologist, said.
In addition, given the difficulty of building a hardware venture to scale, Israni added: “We’ve learnt this the hard way. Hardware is hard. Hardware startups, unlike any other startups, requires a large team with expertise in multiple domains like hardware, software, manufacturing, supply chain, marketing, as well as proper business expansion team, to bring it to life. While Pranoti and I can invent the initial product, scaling operations can only be done with a team of right talents and adequate capital.”
However, she also noted the success of startup ventures that have succeeded, such as gaming hardware maker Razer, which recently listed on the Hong Kong Stock Exchange (HKSE) and has roots in both San Francisco and Singapore.
She observes that a notable failures in the sapce include Singapore-based Novelsys, a hardware firm that developed wireless chargers for phones and went defunct in 2016; US juicer vendor Juicero, which raised more than $100 million in venture financing before closing down; smartwatch maker Pebble, which raised $58.8 million in venture funding being being bought by Fitbit in December 2016 for $23 million; and Internet-connected tea infuser Teforia, which raised $12 million in 2016 but ceased operations this year.
Given the potential for appliance makers such as Samsung Electronics, Sharp Corporation, LG Electronics, Electrolux and other home appliance manufacturer to enter the kitchen robotics space, Pranoti sees the sustainable competitive advantage of Zimplistic being the cloud connectivity of the device, coupled with its machine learning capabilities.
“Hardware is hard and Consumer Robotics is even harder. Thinking of Rotimatic as a traditional hardware product can be misleading. Rotimatic is equally complex in hardware and software.The cloud connectivity, coupled with the machine-learning capabilities, means that the hardware capabilities can be expanded through software updates. This means that Rotimatic is more than just a one-off purchase for the adopters; it is a hardware with growing potentials that keeps on learning,” she adds.