The warehouse robotics provider Symbotic LLC will team with Japanese investment firm Softbank Group Corp. to create a well-funded, joint venture company that offers warehouse-as-a-service automation products using Symbotic’s technology.
Massachusetts-based Symbotic had made a splash last year when it landed a contract to automate all 42 of retail giant Walmart Inc.’s regional DCs in a multi-billion-dollar deal, although specific terms of that contract were not disclosed.
Now Symbotic is getting a boost to grow even faster, with the formation of its new firm, GreenBox Systems LLC. That joint venture plans to automate supply chain networks globally by operating and making accessible Symbotic’s robotics, software, A.I., and automation technology for the warehouse. Symbotic’s technology will be the cornerstone of GreenBox, installed in both single and multi-tenant facilities, making the benefits of automation accessible to more businesses through an “as-a-service” offering, the company said.
By obtaining those warehouse automation products on a subscription basis instead of buying them outright, GreenBox customers will be able to reduce inventory and costs while boosting SKU count and agility, all without associated capital expenditures and operational complexity, the partners said.
The new firm will be well-funded right out of the gate. GreenBox is owned 65% by Softbank and 35% by Symbotic, and will be initially funded with $100 million in backing from the two partners in that same ratio.
Much of that money will come right back to Symbotic, which also today announced a $7.5 billion new customer contract with GreenBox. GreenBox will order Symbotic’s systems over a six-year period commencing in fiscal year 2024, to be implemented across its warehouse network in larger-scale deployments than Symbotic’s current installed base systems. Symbotic expects in excess of $500 million in annual recurring software, parts, and services revenue from GreenBox once all systems are operational.
As Symbotic begins to prosper from those orders, Softbank will likewise profit, since the bank has separately purchased an ownership stake in the Massachusetts-based firm, buying some 17.8 million shares today from Symbotic Chairman and CEO Rick Cohen. Softbank’s ownership stake in Symbotic is also scheduled to grow larger over time, per terms of the agreement. SoftBank was advised in the deal by San Francisco-based law firm Morrison Foerster.
“GreenBox taps into the powerful potential of A.I. and other enabling technologies in supply chains, while also making the benefits of automation accessible to more businesses through an ‘as-a-service’ offering. In partnership with Symbotic, GreenBox will equip customers with more intelligent, streamlined, and scalable warehousing solutions while eliminating the burden of major capital expenditures,” Vikas Parekh, managing partner at SoftBank Investment Advisers, said in a release.
