Insider Brief
- Travis Kalanick’s physical AI startup Atoms raised $1.7 billion in funding, with a16z leading the investment and Ben Horowitz joining the board.
- Kalanick said the funding coincides with the merger of Atoms’ businesses into a single equity structure, with other equity partners including Bain Capital, Uber, Fifth Wall, Chemistry, A*, K5 Global, Abstract, SV Angel and Alpha Square Group.
- Atoms is focused on industrial AI for physical sectors including food, mining and transportation, using software, sensors, robotics and AI to automate work in industries that make, move and store materials.
Travis Kalanick’s physical AI startup Atoms has raised $1.7 billion in funding, with a16z leading the investment and Ben Horowitz joining the company’s board.
According to the announcement from Kalanick, who founded Uber and later started City Storage Systems and its company CloudKitchens, said the funding coincides with the merger of Atoms’ various businesses into a single equity structure. He says the move is a continuation of work he began at Uber to use software to organize parts of the physical world.
Uber, the company Kalnick founded before he was forced out as CEO under a cloud of controversey and accusations in 2017, is among the backers. The other equity partners listed by Kalanick include Bain Capital, Fifth Wall, Chemistry, A*, K5 Global, Abstract, SV Angel and Alpha Square Group and debt partners include Bank of America, Goldman Sachs, Wells Fargo, JPMorgan and Barclays.
Physical AI Built to Grow, Manufacture and Mine in the Physical World
Atoms is focused on what Kalanick described as industrial AI: software, sensors, robotics and AI used to automate operations in large physical industries. The company is targeting sectors such as mining, construction, heavy transport and food production.
Kalanick said Uber digitized transportation and CloudKitchens focused on food production and real estate. Atoms, by comparison, is being built as an original equipment manufacturer for what he called “atoms-based computers” across major industrial sectors.
“Look around you,” Kalanick wrote. “Everything is grown or mined — manufactured and moved. That is industry. The large-scale, organized production of goods, typically involving machinery, factories, and coordinated labor and capital. Mining, construction, heavy transport, food production are just a few examples of atoms-heavy industries awaiting massive digital transformation. Multiple trillion dollar industries rapidly transforming over the next decade powering an engine of prosperity unparalleled in human history.”
Physical AI to Transform
In a separate post, a16z co-founder Ben Horowitz, who also joined the board, noted Atoms has been in development for eight years and is tied to Kalanick’s longer-running effort to apply software, automation and robotics to the physical economy. He noted that just as it was inevitable that computers would have a transformative impact on the world, so will physical AI.
“Similarly, it is inevitable that within a generation, robots are going to do most of the menial work in the world of atoms: transforming atoms, moving atoms, and storing atoms are inevitably robot tasks,” Horowitz wrote. “And while our imagination may be captivated by humanoid robots, the specialized ones are far better suited to most of those jobs. ‘Industrial AI’ as a category is the inevitable application of specialized robots to atoms-heavy industries.”
The post gave more detail on how Atoms grew out of City Storage Systems, the parent company of CloudKitchens. Horowitz said that work helped Kalanick’s team study how people make, store and move goods locally, beginning with food.
Atoms is now organized around three businesses: Atoms Food, Atoms Mining and Atoms Transport. Horowitz described them as large physical industries where software and robotics could improve productivity.
Horowitz also pointed to regulatory and public acceptance as important challenges for companies deploying AI and robotics in the physical world. He argued that products in these sectors will need to become useful to customers quickly to earn the right to operate at scale.
“This lesson is going to be applied over and over again as AI and robotics get deployed into the physical world,” Horowitz noted. “The future belongs to those products that become legitimate by bringing some hustle to industries that have waited for technology to happen to them.”
