April 13, 2014 1:00 pm JST

Aggressive investors scoop up robotics ventures

The Skeletonics' exoskeleton suit drew a lot of attention at the SXSW festival in Austin, Texas. The robot's arms and legs are controlled by the person wearing the suit.

TOKYO -- Robotics is one the hottest trends in the world of startups. Tech giants like Google and Amazon are snatching up new robot-related companies, and powerful venture capital firms are leaving no stone unturned in their search for the next big breakthrough.

     The appeal of robots transcends boundaries. A "wearable" robot from Japan drew a crowd at the South by Southwest (SXSW) festival held in Austin, Texas, in March. 

     Looking like something from an sci-fi anime, the robotic exoskeleton moves its arms and legs in unison with those of the wearer. The robot was created by a group of Okinawan engineers who call themselves the Skeletonics, and it was the winning entry in a competition of Japanese industrial high schools. News of the robot suit quickly spread, and before long the story was picked up by major newspaper USA Today and ABC, one of the three major TV networks in the U.S.

     The man behind the marketing effort was Tomihisa Kamada, co-founder of software company Access.

Little love at home

Now a representative of TomyK, Kamada helps startups get off the ground. But he has encountered stiff resistance in Japan.

     One such startup, Schaft, developed a two-legged robot capable of doing many of the same tasks as humans in an emergency or disaster situation. The robot made it to the finals of a U.S. competition, but when it came to financing a new prototype, Japanese financial institutions and manufacturers balked at the 30 million yen ($291,093) price tag.

     Consequently, Kamada approached Andy Rubin, the former vice president of Google's mobile and digital content, and asked whether he would become a private investor. Rubin, who developed the Android OS for the smartphone, is a known robot enthusiast. He ended up buying the whole company on behalf of Google.

     The buyout, which took place late last year, sent shock waves through Japan's political world. Some voiced discontent about Japanese technology funded by taxpayer money being bought by a U.S. company, but leading Japanese manufacturers and investors are partly to blame for their lack of initiative on the matter.

     Other U.S. companies are also looking for Japanese robot ventures. "Leading U.S. venture capital firms and other renowned companies have been inquiring about capital funding or forming business alliances," said Hisashi Taniguchi, president of ZMP, a venture firm that is trying fuse robotic and automotive technologies. When it released a self-driving car based on the Prius in 2012, the company saw a rapid rise in alliances with overseas firms.

     ZMP was established in 2001 and gained some recognition for its humanoid robot Pino, which appeared in a music video for pop star Hikaru Utada. But then it ran into funding problems. The business came "close to bankruptcy, but bounced back in 2008 when it turned to robotics for cars," Taniguchi said.

The right environment 

One U.S. venture-capital firm came to Japan with a specific question: "Where's the company that created the robots used in Fukushima?"

     They were referring to Quince, a rescue robot that was jointly developed by Chiba Institute of Technology and Tohoku University for use in Japan's disaster-hit northeastern region.

     Satoshi Tadokoro, a Tohoku University professor who had a hand in creating Quince, continues to develop robots with a nonprofit organization rather than a venture capital firm. The reason? He wants commitment.

     In the U.S., robotics ventures are often backed by the country's munitions market. PackBots were originally designed for land-mine detection, and Intuitive Surgical, known for its manufacture of surgical systems, derives most of its revenue from the U.S. military.

     Tadokoro thinks Japan could use a similar type of patron -- not one with a short-term agenda, but a large, reliable one that can support Japan's robot industry as whole. Such a patron, Tadokoro believes, could be found in the field of disaster preparedness. "If the (Japanese) government creates a disaster-prevention market, it will also create a framework in which robots can generate revenue," said Tadokoro.     

     In February, Terry Gou, Chairman of Taiwan-based Hon Hai Precision Industry, the world's leading contract electronics manufacturer, invited Andy Rubin to his private residence. According to sources, they discussed investment in robotics, a strong sign that competition for robotic technology will spread into different industries.

(Nikkei)