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Smart Manufacturing Start-ups to Watch in 2021

Recently, you may have seen news of an investment that Sova VC has been involved in announced by our new partner company, Geomiq. We are very happy to be part of the company’s journey, and we have written more broadly on the disruption that we believe they bring to the low-volume manufacturing market here.

Even though it is a large industry valued[1] at $95–105bn as of 2020, low-volume production is just one part of the multi-trillion dollar manufacturing industry. Through my analysis of this market, I have discovered that due to adoption of industry 4.0 solutions, and an increasing level of industrial automation, the segment of Smart Manufacturing is already valued[2] at $215bn (or up to $350bn according to other sources) and growing at a rate of 12–13% p.a.

With that in mind, it looks like a good space to search for tomorrow’s unicorns, doesn’t it?

Just some background before I begin.

According to a joint report from Dealroom and Speedinvest, while traditional industry accounts for 30% of global GDP, Industrial Tech investment accounted for just 3% of European VC investment in 2020. However, it is growing rapidly (up 8.8x since 2014) and this sector has an opportunity to soon be worth €300bn in Europe alone.

It is also worth mentioning that Smart Manufacturing (or Industrial Tech) is quite a broad segment. It can include a large variety of solutions in spaces such as: robotics, composites & new materials, IoT, equipment and its maintenance, additive manufacturing, and so on. However, due to Sova VC’s focus, we’ll rarely be able to support projects with a significant hardware component, and thus I’ve spotlighted the software segment of this market — SaaS providers and platforms that simplify product design and development, support execution and manufacturing operations, or leverage AI & other technologies to make the production process more effective.

I’ve checked out the latest funding rounds and realised that the SaaS portion of Industrial Tech is a hot space: for example, electronic design automation software was the 2nd most-funded topic[3] in 2020.

As a result, I’ve started to look for entrepreneurs changing the game in these segments, and so here is a shortlist of 15 early stage (up to Series B) companies that I think are worth checking out.

Whether you find yourself on this list already, or you haven’t appeared on our radar yet but would like to chat — please don’t hesitate to reach out to me!

  1. Company: Claroty
    Country & Stage: USA, Series B
    Description: Security & optimization solutions for OT networks, incl. continuous vulnerability detection, threat monitoring, network segmentation, and security posture assessment. Clients include Siemens, ABB, Honeywell, Mitsubishi, and Schneider Electric, etc.
    Funding: $100m+
    Investors: Siemens, Rockwell Automation, and Schneider Electric Bessemer Venture Partners, BMW i Ventures and others.
  2. Company: Seeq
    Country & Stage: USA, Series B
    Description: Industrial data analytics solutions provider. It offers big data analysis solutions that help analyze and understand industrial process data better and faster than standard solutions.
    Funding: $80m+
    Investors: Cisco Investments, Second Avenue Partners, Altira Group, Chevron Technology Ventures, Next47 (the investment arm of Siemens) and others.
  3. Company: Instrumental
    Country & Stage: USA, Series B
    Description: Company offers inspections stations and intelligent software tools for optimizing product and manufacturing line with use of machine learning algorithms. It helps to identify defective units, carry out the root cause analysis and remotely monitor manufacturing line. Clients include Foxconn, Goertek, Pegatron and others.
    Funding: $30m+
    Investors: Canaan, First Round Capital, StartX, Root Ventures, Eclipse Ventures and others.
  4. Company: Cognite
    Country & Stage: Norway, Series A
    Description: AI-based production analysis software with features incl.: collecting operational data from the machines, production optimization, predictive maintenance program and more.
    Funding: $75m+
    Investors: Accel
  5. Company: BrainCube (earlier — IP Leanware)
    Country & Stage: France, Series A
    Description: Performance management platform for manufacturing companies.
    Funding: $14m+
    Investors: Iris Capital, Next47 (the investment arm of Siemens)
  6. Company: Hyperganic
    Country & Stage: Germany, Series A
    Description: Software that can be used to design complex objects for 3D printing based on algorithmic design and synthetic biology concepts.
    Funding: $7,8m+
    Investors: HV Capital, VSquared Ventures
  7. Company: DriveWorks
    Country & Stage: UK, Series A
    Description: Cloud-based product design and development software for the manufacturing industry.
    Funding: $5,5m+
    Investors: Business Growth Fund
  8. Company: Flexciton
    Country & Stage: UK, Series A
    Description: AI-powered production planning and scheduling tool for manufacturing.
    Funding: $4.5m+
    Investors: BACKED, Entrepreneur First, Join Capital, Romulus Capital and other.
  9. Company: Simscale
    Country & Stage: Germany, Series A
    Description: Cloud-based simulation software, that allow to simulate fluid dynamics, structural mechanics and heat transfer. Clients include Larsen & Toubro, Johnson & Johnson, Power engineers, etc.
    Funding: n/a
    Investors: June Fund, Union Square Ventures, Earlybird Venture Capital, Bayern Kapital, and others.
  10. Company: Elise
    Country & Stage: Germany, Seed
    Description: Open software platform for product design. Allows users to plan end-to-end workflows and automate product development.
    Funding: $3,3m+
    Investors: Cherry Ventures, Unternehmertum Venture Capital Partners, BMW i Ventures, Venture Stars and others.
  11. Company: Monolith
    Country & Stage: UK, Seed
    Description: AI and ML-based design simulation software that helps engineers to design products like cars and airplanes. Clients incl. L’Oreal, Honda, Siemens and other.
    Funding: $3m+
    Investors: Ascension Ventures, Tech Nation, Founders Factory and others.
  12. Company: WorkClout
    Country & Stage: USA, Seed
    Description: MRP and MES software for manufacturers that helps to measure, analyze, and manage their production activities and plan resources.
    Funding: $2.3m+
    Investors: Spider Capital, Y Combinator, Soma Capital, Liquid 2 Ventures, Pioneer Fund, Mehta Ventures and other investors.
  13. Company: Conundrum
    Country & Stage: UK, Seed
    Description: AI-based industrial automation solutions: predictive maintenance, quality control and optimization solutions for equipment & production in real-time.
    Funding: $1,5m
    Investors: Speedinvest, Plug and Play Tech Center
  14. Company: Elements Technology
    Country & Stage: UK, Seed
    Description: Production management software for manufacturers. Offers a web-interface that helps to track, visualize and organize production processes.
    Funding: <$500k
    Investors: Northern Powerhouse Investment Fund
  15. Company: FourJaw
    Country & Stage: UK, Seed
    Description: Manufacturing analytics SaaS: real-time process monitoring software that collects data from the CNC machines and provides insights about productivity performance.
    Funding: n/a
    Investors: SFC Capital

Please note that data about companies, funding and investors is gathered from open sources. It could be inaccurate and cited for informational purposes only.

[1] https://protolabs.gcs-web.com/static-files/c5ee8bc2-530b-48e9-9695-93fd7c83f5e5

[2] https://www.marketsandmarkets.com/Market-Reports/smart-manufacturing-market-105448439.html

[3] Excl. pre-seed and late stage (Series E+) rounds. Based on data of 177 companies from segment.

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Alexey Bulygin

Principal at Sova VC. I work alongside a passionate team to empower early stage tech disruptors in their journey