Addverb Technologies Ltd. is seeking to raise over $100 million through its next round of fundraising. These funds will be raised with the aim of establishing the company as the number one producer of robots in the country. Addverb’s CEO, Mr. Sangeet Kumar, expressed that the company is looking for capital after its geographical expansion to competitive international markets.
The international markets that the company ventured into include the United States, the Netherlands, and Australia. This current round of fundraising follows after Addverb’s previous round of fundraising back in 2021, where it raised $132 million from Mukesh Ambani’s company. Reliance Industries currently controls the firm, whereas the founders and employees hold approximately one-fifth of the company.
Capital allocation and the global robotics landscape
Addverb plans to use the capital acquired primarily in terms of creating innovative products, particularly humanoid robots and quadruped robots. In order to do that, the company will concentrate its efforts on obtaining a vast amount of information and developing artificial intelligence capable of training these extremely advanced robots.
The company views the humanoid segment as a promising area for development, entering a relatively new market dominated by companies such as Unitree Robotics or Tesla Inc.’s Optimus. Addverb believes that, according to their estimations, the company currently stands just below the top thirty robotics producers by income on the international market.
The company’s strategic leaders have ambitious plans regarding the future market position. Within the next five years, Addverb would like to enter the top ten international robotics producers, while reaching the top five companies in this field in another five years.
International market competition involves many larger and more established companies coming from different countries, such as China, Japan, and the USA. Despite the large sizes of these competitors, Addverb’s leadership does not believe that there can be a spot left for an Indian company on the international market.
In order to stand tall against the competing Chinese companies, which enjoy obvious advantages of experience and government assistance, Addverb has been working hard on establishing its own technology. One of the key aspects of this approach is minimizing dependence on imports. Specifically, in an effort to become less dependent on foreign suppliers, Addverb has decided to develop its own proprietary lidar sensors, the development of which took over two years of in-house R&D work.
Product applications and financial outlook
Addverb is a warehouse automation technology company that was started in 2016 by four engineers. Each of the four founders was a former employee of Asian Paints Ltd. Asian Paints Ltd. is India’s largest paints manufacturing company.
At its startup phase, the new venture encountered difficulties due to the nature of its asset-intensive model since traditional venture capitalists were not convinced of its viability. The company’s founders later got support from one of the investors of Asian Paints Ltd.
The uses of products offered by this company extend to include factory automation, electronics production, health care, defense, and research applications. The domestic corporate clients of this company include some of the largest retailers and consumer goods producers, such as Lenskart Solutions Ltd., Hindustan Unilever Ltd., and Reliance Industries.
Addverb has succeeded in establishing its presence around the world since the company earns roughly half of its total revenue from foreign markets. Currently, Addverb has operations in over two dozen countries with employees numbering almost 1,100. Although the startup reported losses over the last two years due to high expenses incurred from rapid expansion, Addverb is expected to turn around and become profitable in the next fiscal year ending March 2027.
The company’s CEO believes the firm will record net profits in the subsequent year. Having a robust backlog of orders estimated at $200 million, Addverb is optimistic about achieving revenue of ₹1,300 crore in the current fiscal year. Even though an IPO is one of the most viable options for boosting company operations, the management does not have any immediate plans to offer its shares to the stock market.
According to the management of Addverb, the company considers itself too small at present to go public. They may wait until achieving some sales milestones of ₹4,000 crores or even ₹5,000 crores before entering the stock markets. Assuming the firm continues to grow in the same manner as it has been doing to date, the leadership believes that this milestone could be achieved within two years’ time.
Conclusion
Addverb Technologies is setting itself up to be one of the key players in the field of advanced robotics through its ambitious plans to raise $100 million. As the company focuses more on advanced robotics, develops its own components such as lidar sensors, and benefits from financial backing from the likes of Reliance Industries, Addverb Technologies emerges as a promising global player in the field of robotics. With the order book amounting to $200 million and profitability imminent, Addverb Technologies clearly shows the growing strength of Indian engineering in the world.
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