Putting Robots to Work

Amanda, good morning. Thank you so much for being here. So, at Boston Dynamics, you're really betting that robotics is central to the future of the workplace, of the workforce. Tell me why, as CFO, that bet is worth it for you. Why it makes sense. I think I fell in love with the robots when I came there. We were early in our commercial journey where these brilliant people, like many people in the startup world, you know you see a great idea and maybe not necessarily all the skills necessary to make it a business and so the ability to come in there and then actually help build all the foundation necessary for this to be a scaling commercial world leading business um that's the bet tell me a bit about that foundation and how you transformed the idea of a robot into a legitimate scalable business yeah i mean it's a big question but what does it involve um so it It was a series of not only, you know, getting the business together, meaning the foundation of systems, business process, all the things you would expect from the back office, you would say. And then also, you know, there was a ton of inbound demand when we first had talked about selling robots. Anyone who knows, you know, inbound demand at some point dries up, you need a proactive sales motion. So it was hiring sales leaders and helping everyone understand what does it really take to deploy robots in the world? And that is sales, that is, you know, integration and all the infrastructure behind that to support services and things that customers will need to find value in these robots. So it was building all of these teams and then building all of the business processes behind it to support that in the real world. Amazing. So much fun. I can only imagine. I think a lot of people in this room, me included, When we hear the word robot, when we hear the word humanoid, we think of this quite scary sci-fi dystopian future. What are a couple of things that we humans get wrong about robots and the direction of travel right now as we think about integrating them into various sectors? I get the scariness because all anyone has had to go off of has been movies. right it's been what you know you see in a movie is terminator or something scary um but in reality these are tools there's a right now industrial tools like every other tool you use um and they still take quite a lot of work with humans in order to be useful and for businesses to realize value um they're not yet at the set it and forget it stage so um and i think you know Boston Dynamics specifically we're really focused on safety and reliability so having this be something that doesn't hurt or harm you know i think we're the only company in the world that in our terms and conditions it says that these cannot be used to harm or intimidate humans or animals how do you make sure that happens because that's a great guideline to have yeah yeah how do you enforce it i mean right now we have the benefit of being pretty sensational if someone uses our robots unfortunately someone's taking a video of it and so we know about it and then we have we can either stop servicing them which we would we would shut down their at an extreme level shut down their robots but it's mostly around like what can we do legally um we we would refuse to service sell them additional payloads um and then go all the way to you know taking legal action if they violate you have to do that yeah we haven't i'm so lucky to say that it has been we've had a cease and desist letter it's probably as far as we have to go with someone making an artistic rendering of a spot with a weapon on it. But we take it very seriously. What are some of the companies, can you give us a sense of where robots are currently the most integrated? Where are they making a difference right now? Yeah, so I think of it in terms of industrial. So within the industrial sector, semiconductors, chip fabs are finding a ton of value in this, doing industrial rounds and reading their facilities, Intel is one of our largest customers. Food and beverage as well as like Nestle Purina is finding a lot of value in this things that you wouldn't think of them or I didn't think of but you know we have this Google Street View for our spot robot where it's going and doing around and reading we have this orbit platform that sits underneath where that is the user interface for our customers they can type in there almost like a Google Street View of their entire facility they have you seen any rats and if you ever see rats can you send a ticket to whatever their internal system is that's a real problem for people in food and beverage now it might be there to monitor assets and that is what it's doing on its mission its autonomous mission but the secondary benefits that we're finding are ways for our customers to interact and really understand their environments and reduce risk in their facilities a big concern around robots is obviously what it means for the human workforce so what happens in the sectors that you just describe what are you seeing right now in terms of impact on employees and their job prospects? Yeah, I mean, I think it's interesting that the things that we are actually seeing and the fear people have are a little bit separate in that I understand the fear that folks have about, you know, robots displacing human workers. What we've seen is that the most powerful usage of these robots is augmenting human labor. It's not replacing it. We actually find that people embrace, you know, most of the workforce is embracing this technology. They're naming the robots. They're really embracing the dull, dirty, dangerous work that these robots are going in to do, that are keeping human bodies from having to do. So what do the people who are employed in those jobs do now when the robot comes into the equation? So they're still working. So like, for example, in industrial rounds and readings, this was someone who is walking around with a hand scanner and taking a picture of assets throughout the entire day. One, they just weren't doing it, is what we find. Humans don't want to do this very dull, mundane task. If they are doing it, they're not doing it accurately. So those folks are now sitting and saying, okay, well, now I'm getting accurate data coming in. I know this facility inside and out. How would I take my brain and focus it on analyzing this data and making sure that things are behaving in the way that we want or augmenting workflows so that it is valuable for the business and way more interesting for the human who was otherwise just walking around with a scanning gun. I want to welcome our special guests to the stage and maybe Amanda you should introduce them. Yes, we have Spot here with us today. Come on Spot, little cutie. Spot loves being here. Spot can do stairs. Spot has to do stairs in all these facilities because that's what's necessary and do you see when i talked about safety um spot is not going to run into me it has obstacle avoidance built into me it will work around me it will work around humans it understands all of this environment um and this spot actually has this spot is called jasmine oh yes so the ladies here decided that um they were naming spot backstage so this one's jasmine and what is hi jasmine um what is the what is jasmine spot's practical application in the world. Talk us through that. So with this current configuration, so this is our baseline spot with an arm. There's two cameras in the front, one on either side and one in what we call the robot. And then there's one in the hand. So for this application, the arm is for manipulation tasks. So this can navigate autonomously. It can collect data using all of those stereo cameras. And then with its hand, it can use that to open manipulate doors, it can pick up objects, it really has a bunch of different applications depending on the use case. Oh wow and now it's grooving along. Sometimes she gets a little ahead of herself. How much does the spot cost to buy? So it depends on the configuration, the base platform is around a hundred thousand dollars and then depending on the payloads and what you want to do in yours it can be all the way up to three hundred thousand if we're really thinking about full acoustic vibration and thermal detection and who are the primary customers so there it's pretty much the semiconductor manufacturing, food and beverage, public safety, so we also have Spot in this configuration working with police officers throughout the country where it's keeping what we've learned is if we put a robot in a situation with someone with a gun and someone who's not whether they're the police whether they're a someone who's ill, it keeps people safe, it keeps everyone in the situation safe, so we have de-escalated a lot of situations, saved some people from pretty nasty hostage situations and Spot taking people out of hostage situations, yeah tell me a bit about that, so we had someone who is mentally ill that kidnapped their child in a car and had a knife on them and we sent the police officer sent Spot in, was able to use the camera array in the hand to get eyes on this report back, keep both the child safe, the person who is, you know, ill that had taken their child hostage safe and not put a police officer in harm's way so really helpful work that it's doing in the world, on top of doing really amazing work for industrial customers, well well you can go back to your robo kennel, thank you so much for joining us, does anyone have any questions about Spot? Yeah Oh, did it? Oh, Spot. Yes, we're going to take a couple of questions. So let's go to Betsey and then we'll go over. Actually, yeah, we'll go to Betsey and then we'll go here. I want you to be able to react to what you've just seen. Betsey. Hi Betsey, my name is Dani Herman, CEO of X-late. I have a question both about Spot but also about Atlas. As they grow and you are basically going from idea to mass market, what is the biggest constraint you have? Is it rare earth magnets? Is it actuators? Is it compute? And then how do you actually manage that on your balance sheet around supply chain risk? Do you rely on Hyundai? Do you do anything else to balance that off? Yeah, so she's asking about Atlas, which is our humanoid robot that is coming to market right now. So I think when I think about the business, the Atlas business, and what is going to actually ultimately get us to scale in a really positive gross margin trading way, the things that I focused on was, you know, what does our supply chain look like? And I think we're in a really beneficial position with Hyundai as our majority owner, now 100% owner, utilizing their fully integrated supply chain. And that means, you know, when you think about an Atlas robot arm, 70-ish percent of that is actuators. Hyundai Mobis is actually going to be producing our actuators for us at cost, you know, in targets that give us confidence that we can actually hit those targets. and then when I think about you know both the the second factor of you know control your cost and then get to scale fast and so Hyundai is also signed up to at this point they've committed to about 50,000 robot deployment in both the Hyundai Motor Corp and Kia facilities so that gives us kind of planning certainty then cost target certainty and then we're working in parallel with our existing spot customers in order to do things not just focused on Hyundai but with our third parties so really that for us that's really exciting that's de-risked the way we're thinking about it of course compute is something we're all thinking about a lot that we're going to benefit from that supply chain as well Hyundai as you can imagine their vehicles is using and other businesses they have is using quite a bit of compute so to the extent that we can get buying power with them We're going to utilize that as well. And then I think we have a solid path. A really solid path. I'm very excited about it. And I think it's important that we're the only robotics company that has proven commercial traction with mobile autonomous robots. So we're building on it a great foundation. We're going to go over here, and then we're going to come to Toshiba Hi, Windsor Western, CEO of Toshiba. So it didn't appear that anyone was backstage controlling Spot with a remote control. so was Spot operating independently and if so i think the doomsday scenarios around ai and robots come to mind and that's what scares people so much so if robots like Spot are thinking right on their own responding in real time robot is hilarious by the way um how are you controlling for that and how are you keeping them safe if they're thinking independently okay so today Our lovely robot wrangler, Alex, was driving this with a joystick, right, a controller, for this demonstration just because this is kind of ad hoc. In facilities, they're doing autonomous rounds and readings. So when I say autonomous, it means that you humans, you if you're the worker, are scheduling what you want this robot to do. You're telling it where your assets are. You are encouraging it to explore your facility. and then it may tell you new things about your facility like that example i gave about the rats but we are guiding we as humans are guiding what these robots are doing now does yes that as ai progresses there is new thinking and new assumptions it will make based on what it learned and be speeding back into systems but i think the better way to think about Spot specifically is this is very much a data capture tool it is to give you more information Spot is not going to there's nothing scary Spot can do frankly right it's it's walking through it's taking pictures it's reporting back it's interacting safely with environments it is not weaponized as you saw it as obstacle avoidance it's not even going to run into a human or step on a human so i think some of those concerns are more about a black mirror that they watched versus you know the reality of where we are with technology. Sheila? Hi. I've been fascinated. I'm on. Hi. I've been fascinated. Is that a special line? No, we can hear you. Okay. The use of robotics in general. Where do you have or do you see applications of robots in healthcare delivery? I'm familiar with robotics used in surgery, but where else do you see it? Particularly, do you see any patient interfaces with robots? AI has been able to capture a lot of the empathy required in the patient interaction. What do you see with the future or the present of robotics in healthcare delivery? Yeah, I think for us, for Boston, I can't speak for it as an industry at large. I know there's a lot of work being done in the healthcare sector specifically, but for Boston Dynamics, we're starting in industrial for very pragmatic reasons. It is repeatable. It is a place where humans have spent a lot of time thinking about the way that humans and machines interact. And so safety is of a really high benchmark for them. And we want to master that. We really believe that you earn your right to be closer to humans. So we start in industrial. We have a roadmap to go into service. So we would be in things like retail, potentially hospitals but not in the patient I don't think we'll be working with patients directly maybe as a concierge service something like that and then ultimately consumer and moving into the home but that's a long road now we're talking about a 10-year roadmap for that. Amanda you ran the company as interim CEO up until last week when Rohit Prasad was installed as the new CEO were you interested in that long-term CEO role you know I think um you never say no I wasn't I will start by saying I didn't want the CEO role when I got the interim CEO position I was you know the CFO role here was my dream job um the board said next week you start as interim CEO and I said we'll figure it out um and then I did and so I think um it's opened my eyes to what I'm capable of. And so I think I would have thought about it. But once I met Rohit and my board was so kind as to let me have a say in the final candidates and really took my feedback to heart, he has experience I don't have. And I think being great on the team means you need to know when you're not the best fit for it and, you know, and want the team to win more than anything. And so I think He's going to be phenomenal. What was the trickiest financial decision you made during your time as an interim CEO? I would say probably we reorganized the entire company like two weeks into my role, which was quite a lot to undertake. It was the right decision, and we had been very slow to make it and kind of in that stuck position of what if, what if, what if, and I'm like, rip the bandaid off. Let's reorg this. Let's make it. You decided that that was the moment to go. Yeah. And so that was scary, and it had financial implications, and it also just had organizational implications that I was nervous about how it would be received by our teams. And everyone just rose to the occasion and supported me and really understood. Like, I think I spent a lot of time explaining my why, and they heard me and said, I ride with you. Like, I believe in what you're doing. So that was really great. I've had an amazing group of people behind me. We have two minutes. So, Annie, I'm going to give you the opportunity to ask a very quick question, and then Amanda, as quick as possible, an answer, but I know that's tricky. I will do it. First of all, thank you so much for this topic. It's super interesting. Two things for you. When you look at the future, we know robotics is going to be a huge competitive niche. How do you feel the competitiveness with China, given their manufacturing capability? And second, if the future casts out, When will it be affordable to have a humanoid helping us at home with our household duties? Yeah, that's the question everyone's getting. I'm going to take the second one first because it's fun, which is, you know, we have a 10-year roadmap that we look at. We personally are not going to go to consumer probably until like the mid-2030s. We think that's when it will be safe and reliable enough and cost effective. That's the whole thing. from start to finish, when we put humanoids in the world, the lessons we learned in deploying robots is this needs to have an ROI for customers. They need to see that in under two years for industrial, but probably even sooner for consumer. We think about crazy models like, can you rent it for four hours to come do your dishes and take care of your laundry and clean up your house? So that is, I think, going to be the future. And in terms of the competition with China. Listen, they're moving at light speed. Everyone should be nervous about that. I think when we do teardowns and look at the actual performance of the robot, they're not there yet. Our robots, you know, we've been working on it for 20 years. This isn't new for us. Even with our U.S. competitors, you know, we're quite a bit ahead in terms of what our robots are capable of. AI changes the game quite a bit, and we're really focused on that right now. Amanda, thank you so much. Thank you for bringing Spot with us to our meetups as well. It was a pleasure. Thank you.