Grey Orange — India’s first Industrial Tech Unicorn in the Making
‘Hardware is Hard. It’s called Hardware for a reason.’ — Marc Andreessen
While most of our Indian Startups have made services such as booking a cab or a hotel room more convenient, very few startups have come out successfully that involves industrial technologies.
In this first edition of our long-form Startup Spotlight series as part of our monthly newsletter, we bring the incredible story of Grey Orange the Industrial Tech Unicorn in the making.
Why is the story Grey Orange incredible?
Because for one simple reason — it is rare for an Indian-origin hardware startup that builds high-tech which require not just software expertise but hardware, electrical and mechanical engineering looking for a global market. This requires significant competence and not just the ability to imitate a Western idea.
And where did this story start?
The Genesis
A decade ago Samay Kohli and Akash Gupta were two friends who happened to be college senior-juniors as well, Samay Kohli is the senior in this story that has its genesis in the BITS Pilani campus. Both of them shared a common passion for science and mathematics which they fulfilled by indulging in robotics.
They both were part of the team that created India’s first indigenous humanoid robot Acyut, at the Centre for Robotics & Intelligent Systems at BITS. In 2009, they had won a gold medal at the ROBOlympics (now RoboGames) held at San Francisco and together they have represented India across 13 countries in various robotics competitions.
The exposure to global robotic competitions, platforms such as the Center of Entrepreneurial Leadership at BITS and the internship they did at C & C Technologies in the US seem to have had a strong influence on their lives.
During their internship at C&C Technologies which was a company into surveying and mapping, they were tasked with creating a mini Disney park spread over an area of 400 sq ft, everything in it was to be automated with special effects. This was their very first experience in building a product of scale.
After these multitudes of exposures, not keen on taking a corporate career, without a big plan the duo in 2011 with an initial capital of Rs 5 lakh INR sourced from their personal savings through their internships in the US, dabbled into the field of robotics education and started the company Grey Orange.
Through Grey Orange, the duo started teaching in colleges and institutions, and soon they came to realize that it was not their cup of tea to manage the teachers nor build a curriculum.
They shifted into the service space and eventually built 3–4 white label products for other companies. One of the products was an image processing project for C&C Technologies where they had interned during their college time.
The duo strongly felt the need to pivot and started searching for industries where they could add real value and also where they could grow.
They had set themselves with few basic rules for finding an industry to work on, such as — solution of the problem must be of disruptive enough, the problem itself must be of global in nature and the solution must, more importantly, involve a combination of hardware-software.
Their Eureka moment was when they walked into the Flipkart (Both founders of Flipkart are investors at Grey Orange) warehouse in Delhi around 2012, where they saw piles and piles of product spread out throughout the floor and people trying to pick up products package and sorting it with great difficulty.
This scene of total chaos convinced them that this was the space they had to be in and they got their first order of INR 35 Lakhs building a system of complex software and elegant hardware that helped Flipkart warehouse workers to move items faster and efficiently.
Imagine the kind of cost-savings Flipkart would have achieved for its fulfilment centres. The highly impressed founders of Flipkart had eventually referred Grey Orange to Tiger Global (the most prolific global investor in Indian startups) after which there has been no looking back for the duo, as rest is history now.
Today Grey Orange with more than 600 employees is a world leader in the warehouse and supply chain automation space. Grey Orange, a unicorn in the making, is the only deep-tech startup among the 76 most prominent startups in the Indian Startup ecosystem. There are 51 potential unicorn startups (which Grey Orange is part of) and 25 unicorn startups.
So if you ask us in simple words what does Grey Orange do?
Grey Orange is the company that makes sure when you order something online, that it reaches you as soon as possible in the most efficient way.
And How does it do this?
Currently, it offers two kinds of products — one, high-speed advanced sortation systems that automate outbound profiling and sortation processes in fulfilment and distribution centres for which it has four product variants namely: Flexo, Linear Sorter, Cross-Belt Sorter and Pick-Put-To-Light.
Second, the goods-to-person systems Butler and Butler PickPal which improve inventory management and accelerate order fulfilment, while enabling warehouse managers to reduce stock losses and pilferage.
Grey Orange’s products have resulted in the minimal need for human movement in warehouses and, consequently, a huge reduction in human error and wasted labour. Previously a typical warehouse worker was used to picking up about 100–120 items in eight hours. Now using the technology built by Grey Orange this number has gone up to 400–600 items per hour.
More recently in late 2019, the company has integrated its fulfilment operating software Grey Matter with an adaptive-learning, collaborative decision-making and analytics layer to its line of products, which will enable the modernisation of fulfilment for throughput speed, scale, accuracy and yield.
Building A Brand For The Long-Term
The name Grey Orange according to Samay Kohli, represents two core values which resonate with what the brand stands for — the Grey stands for Grey hair & experience and whereas Orange stands for creativity and fun. And he believes in a three-year plan when they get closer to six months or a year close to the goal, they start looking out for the next milestone to be reached in the three years to come.
In almost a decade of existence, Grey Orange has built a global brand by expanding its footprint beyond India to the United States, Singapore, Germany, and Japan, it operates each of these as separate Business Units. The company has more than 70+ deployments at clients’ places and boasts an impressive client list with India’s leading eCommerce retailers such as Flipkart, Pepperfry, Myntra, Jabong, courier-services companies DTDC, Dubai-based Aramax and XPO logistics one of the worlds largest logistics player to name a few in its kitty.
The Grey Orange founder duo have gained immense confidence of its investors as seen by the way of Blume Ventures participating consistently in every round of their funding right from the seed stage to Series C.
Blume so far has invested a total of 10 Million $ in Grey orange and considers the strong IP of products(Grey Orange so far has filed more than 50 patents), deep domain expertise of the founder duo and their ability to build and scale a global company as key factors in backing them.
Kartik Reddy, Managing Partner at Blume had quoted that even when the original fund reserves of Blume had exhausted, they had requested their LPs [limited partners] for additional capital to continue investing on their pro-rata share for the larger rounds of Grey Orange. Though VC funding is definitely not proof for a startups success, it’s a gauge to the promise it holds and the trust among backers.
Ajay Royan of Mithril Capital (Facebook early investor Peter Thiel is a co-founder at Mithril), who led the Series C funding round is confident that Grey Orange is all set out to capitalize the global logistics and automation market which is expected to exceed $125 billion in the next seven years.
With all said Grey Orange has emerged as a brand that has changed the game of logistics and warehouse management industry which had very little disruption in the last few decades.
Going Truly Global
While most of the Indian Startups shift their base to Singapore to avoid tax woes and benefit from the Singapore Governments’ business-friendly policies and as well for the other incentives available for foreign investors. The founders of Grey Orange quote the geographical location of Singapore that gives better access to the rest of Asia and the operational flexibility to shifting the base from Gurugram to Singapore.
And also as per official sources as of today, only 10% of the company’s revenue comes from India while the rest comes from countries such as the US, Japan, and Western Europe.
As we had mentioned earlier the company treats each of the countries in which it operates as separate Business Units (BUs) and each BUs have their own CEOs with their P&L assessed individually.
Going global for Grey Orange also means having a global workforce as it wants to leverage the talent pools and ecosystems across different parts of the world to meet it’s market and customer expectations.
The US headquarters of Grey Orange is located in Atlanta, as it is one of the key transportation hubs with a large base of leading supply chain and logistics providers. There are plans to expand the R&D centre in Boston, US as well.
And much of the company’s prototyping happens in Shenzhen(China), the world’s go-to place for top-notch hardware.
The global expansion of Grey Orange seems to remain unstoppable as Clients from Chile to Japan, the U.S. to Germany and more have evaluated GreyOrange by deploying small paid pilots and turned out into a $10 million-$20 million single warehouse deployment contracts.
The Saga Continues
The current valuation of Grey Orange is close to half a billion-dollar and it’s all poised to touch a billion-dollar valuation (unicorn status) in the next round of its funding.
And Grey Orange as well might go beyond a billion-dollar valuation and eventually lookout for an IPO in the coming years. One strong reason being that in 2012 Amazon had acquired Kiva robotics (which is now Amazon Robotics) for 775 Million $ which resulted in a huge vacuum that is yet to be completely filled in this space.
So, with all said it would be very interesting to see how far an Indian Industrial Tech Startup founded by two young engineers straight out of college without any industry experience will reach.
This decade long story is definitely an inspiration for all the young innovators out there looking to build tech that solves the most fundamental problems our industries still face.
Decoding Grey Orange
If we look back, the primary reason for the massive success of Grey Orange was their initial partnership with Flipkart, an already established e-commerce player and this eventually led to Tiger Global, the marquee investment firm coming on board.
This calls out the strong need for collaborations between Industry and Innovators/Startups, not everyone can pull this off as well. At Forge being the partner incubator for open innovation, we primarily focus on supporting startups engaged in developing technologies and products for industrial applications to co-create effectively with the Industry. In doing so, we believe that startups would exploit opportunities to address the strategic innovation priorities of bigger companies to get on a faster growth trajectory.
If you are a startup founder looking to achieve an enduring competitive advantage and global salience in technology like the founders of Grey Orange, especially in futuristic domains that have the strongest potential for disruption, it is but imperative that the research, development and application of these technologies are aimed at engineering commercial solutions addressing the needs of the core industrial sectors. The industrial sectors you choose can be automotive, aerospace, defence, space, oil & gas, power, precision engineering, heavy machinery etc.
To enable entrepreneurs harness the power of their entrepreneurial innovation we at Forge offer programs that manage these industrial open innovations that have the ability to scale exponentially leveraging our infrastructure and capabilities.
Over the years we have seeded and nurtured over 500 open industrial innovations out of which over 100 have graduated to become startups through our programs such as ProtoSem which helps young innovators while in college and the Startup Masters Program that desrisks entire the process of starting up through our Managed Incubation Process.
