Grabango, one of the latest entrants in the race to outfit stores with automated checkout technology, announced this week that it has raised $12 million in venture capital funding, according to a Grabango press release.
The company, founded by Pandora Radio Co-Founder and CTO Will Glaser, has raised a total of $18 million. Propel Venture Partners led the latest investment, and others including Ridge Ventures, Abstract Ventures, Commerce Ventures and Founders Fund also contributed.
Grabango’s system, which allows shoppers to use a smartphone app to check out, is designed specifically for large stores. It also can be used without the app, in which case a virtual shopping cart linked to an in-store computer tracks what shoppers are adding to their carts. When shoppers are ready to pay they can move quickly through the checkout line and pay without having to unload their carts and have items scanned by the cashier, Grabango told Retail Dive in an email.
Grabango joins a growing list of companies chasing the automated checkout market opportunity.
Since its 2016 founding, the company claims to have signed deals with “four major U.S. store chains that generate billions of dollars in revenue, serve more than 600 million shopper visits per year, and cover a combined 29 million square feet of floor space,” according to the press release.
Focusing on (and winning over) larger retailers and stores may help distinguish Grabango from other technology companies in this market. The company also claims to have initiated store deployments covering up to 50,000 square feet. Meanwhile, Amazon is focusing on the smaller convenience store format with Amazon Go, and others in that particular segment, including 7-Eleven, have started to grasp the value of letting customers checkout with waiting in line.
Thus far, it hasn’t been entirely clear that retailers with large floor space and extensive product selections were appropriate targets for automated checkout technologies that rely heavily on the accuracy and reliability of expensive computer vision-enabled camera and sensors placed throughout stores.
However, the sector’s understanding of this market opportunity seems to have evolved recently. Just a few days before Grabango’s funding announcement, Standard Cognition announced the acquisition of Explorer.ai, a company with mapping software that can be used to quickly plan large-scale deployments of the cameras used for automated checkout. Both Grabango and Standard Cognition see a way forward for large retailers to use automated checkout to some degree in their stores.
An interesting market battle could play out starting this year as these two companies and others operating in the giant shadow of Amazon Go attempt to convince retailers that automated checkout can change their fortunes for the better.