Expect to see more cost-effective ‘cobots’ working alongside humans, says Bank of America

Good morning. Collaborative industrial robots, or “cobots,” soon could become many employees' new workplace besties—to say nothing of how much workflows improve or how much money their companies save.

Cobots, which are evolving alongside the tech used for motion-sensing capabilities, are among the next generation of robots on the rise, according to a June 20 report in Bank of America Institute’s “Next Gen Tech” series. They are “small, nimble robots” that can move around a factory floor to collaborate with workers, the report notes. Powered by AI and machine learning, cobots work alongside humans and are designed to conduct much more complex tasks than traditional robots. Some that are programmed with generative AI will be able to communicate with humans, a far cry from traditional robots, which actually cost more and are harder to program.

“The cobot is now a more competitive option for a customer looking to automate a factory without the need for large areas of fenced-off factory floor,” according to the report.

Raising funds for this emerging sector is becoming similarly competitive. Collaborative Robotics, a Santa Clara, Calif.-based company that develops cobots, announced in April that it had raised $100 million in Series B funding, led by General Catalyst and joined by Bison Ventures, Industry Ventures, and Lux Capita. It's now raised to over $140 million in less than two years.

"We see a virtuous cycle where more robots in the field lead to improved AI and a more cost-effective supply chain,” founder Brad Porter said in a statement in April. “This funding will help us accelerate getting more robots into the real world.” The company expects cobots to be used in sectors such as manufacturing, health care, retail, and e-commerce, partially because they're more cost-effective than humanoid robots, another type that BofA is including among its next generation along with autonomous vehicles and drones.

Porter, a former Amazon VP of robotics and an engineer, founded the company in 2022. The Cobot team includes robotics and AI experts from Apple, Meta, Google, Microsoft, Amazon, and even NASA. Other companies leaning into cobots are Schneider Electric and Universal Robots, a Danish manufacturer, which announced its new CFO, Sonja Østergaard, in May.

"The company's opportunities are immense given our cutting-edge technology and the highly innovative industry we are working in," Østergaard said at the time. "I see finance as playing a pivotal role in the journey we are on."

Sheryl Estrada
sheryl.estrada@fortune.com

This story was originally featured on Fortune.com