Fresh off of selling ARM to Nvidia for $40 billion, Softbank is again divesting itself of a flashy company. This time it’s selling Boston Dynamics, the state-of-the-art robotics company, to Hyundai Motor Group. Hyundai is acquiring an 80 percent stake in Boston Dynamics in a deal valuing the company at $1.1 billion. Softbank will retain a 20 percent stake.
Boston Dynamics was spun out of MIT as a private company in 1992 and survived for a long time on military contracts. The company became famous by sharing its work on its YouTube channel, where the better-than-sci-fi robot footage would reliably go viral. Google bought Boston Dynamics in 2013 with a plan to build a robotics division, but as Google is wont to do, it lost interest in robotics and decided to sell the company to Softbank in 2017. Softbank had an even shorter fling with Boston Dynamics than Google, and it was forced to sell the company after its investments in Uber, WeWork, and the now-dead satellite-broadband provider OneWeb tanked. Hopefully, this sale means Boson Dynamics has finally found a stable home.
Hyundai Motor Group is the second-largest Korean conglomerate after Samsung, and it’s the world’s third-largest vehicle manufacturer. Hyundai Motor Group owns the Hyundai Motor Company—the company that actually makes Hyundai-branded cars—along with Kia Motors, the Hyundai Engineering & Construction Company, and a few Hyundai-branded auto parts companies. So what does a car company want with a robotics company? Hyundai Motor Group’s press release calls the two companies’ technologies “highly complementary,” and Hyundai wants to “propel development and commercialization of advanced robots.”
“By establishing a leading presence in the field of robotics, the acquisition will mark another major step for Hyundai Motor Group toward its strategic transformation into a Smart Mobility Solution Provider,” Hyundai Motor Group said. “To propel this transformation, Hyundai Motor Group has invested substantially in development of future technologies, including in fields such as autonomous driving technology, connectivity, eco-friendly vehicles, smart factories, advanced materials, artificial intelligence (AI), and robots.”
This is not the first time Hyundai Motor Group has gotten involved in robotics. The Robotics Lab of Hyundai has demoed a line of exoskeletons like H-MEX, the Hyundai Medical EXoskeleton, and the “medical” version is designed to help paraplegic patients walk again, while other variants are designed for heavy lifting. Note that “Robotics Lab of Hyundai” is a different group from Hyundai Robotics, which is owned by Hyundai Heavy Industries, a shipbuilding company that is separate from Hyundai Motor Group (they share a founder).
Perhaps the most exciting line in the press release is that Hyundai Motor Group “will provide Boston Dynamics a strategic partner affording access to Hyundai Motor Group’s in-house manufacturing capability and cost benefits stemming from efficiencies of scale.” If we’re ever going to have home robots that do the dishes or whatever, they’re going to need to get a lot cheaper, and teaming up with one of the world’s largest auto manufacturers sounds like a great way to do that.
The path to profitability
When Boston Dynamics was bought by Google in 2013, it quit the military business and ceased having any kind of income at all (maybe you could say the company became a full-time YouTuber?). That all changed six months ago, when Boston Dynamics started selling Spot, a robotic quadruped, to the public for $74,500.
A recent report from Bloomberg gives us a better idea about Boston Dynamics’ financials. The report says about 400 Spot robots have been sold, “bringing in at least $30 million in revenue.” That’s still not enough to cover the costs of running the company, which Bloomberg said cost Softbank “upwards of $150 million annually,” but keep in mind Spot has only been on sale for six months. So how much is a state-of-the-art, money-losing robotics research company worth? It depends on who you ask. According to the Bloomberg report, SoftBank bought Boston Dynamics from Google for $165 million in 2017, and then it turned around and sold the company to Hyundai in a deal over six times that value just three years later.
In terms of practical commercial uses, today Spot is little more than a highly mobile camera, and it’s used as a quieter, more people-friendly replacement for camera drones in places that need remote monitoring. Boston Dynamics is working on adding more capabilities to its robot dog, though, namely in the form of an attachable arm coming early next year, which will allow the robot to manipulate objects and perform tasks. The company also sells the “Pick” vision system for robotic arms, and it’s working on moving further into the warehouse with the development of a depalletizing mechanical ostrich robot called “Handle.” Also currently in development is the very impressive humanoid robot, Atlas (it can do a backflip!) though Boston Dynamics says Atlas is “a research platform.” Every other robot you’ve heard of from the company, like WildCat and all the military pack-mules, are retired.
It doesn’t sound like Boston Hyundynamics will turn boring any time soon. The press release also mentions, “Over time, Hyundai Motor Group plans to expand its presence into the humanoid robot market with the aim of developing humanoid robots for sophisticated services such as caregiving for patients at hospitals.” Please just don’t shut down the YouTube channel.
Listing image by Boston Dynamics