Grabango mobile app
Grabango
Grabango, a venture-backed startup that was vying to be acquired Amazon In cashierless checkout, it closed down after it couldn't raise enough money to survive.
“Although the company has established itself as a leader in payment-free technology, it has not been able to secure the financing it needs to continue providing service to its customers,” a company spokesperson said in a statement to CNBC on Wednesday. “The company would like to thank its employees, investors and customers for all their hard work and dedication.”
Food tech publication The Spoon previously reported on Grabango's closure.
Launched in 2016, Grabango has been developing checkout-free technology that uses computer vision and machine learning to track and count items as shoppers pick them up from store shelves. Will Glaser, founder and CEO of Grabango, is a longtime Bay Area technologist who co-founded the music streaming service Pandora.
The company has employed nearly 100 employees, according to LinkedIn and Pitchbook.
Grabango has raised just over $73 million, and its largest funding round will come in 2021, before the market turns, Pitchbook data showed. In June of that year, Grabango raised $39 million in a round led by Commerce Ventures, with participation from Peter Thiel's Founders Fund as well as the investment arms of the company. Unilever and Honeywell.
In February of this year, Glaser told Axios that the company had plans to go public “within two years with a market cap of between $10 billion and $15 billion.”
The IPO market has dried up since early 2022, with only three notable venture-backed companies making their US debuts this year. The lack of liquidity has battered the venture industry, making it difficult for companies to launch new funds and for startups, with the exception of a few AI companies, to raise capital.
Based in Berkeley, California, Grabango was seen as a primary competitor to Amazon's cashless payment offering, called Just Walk Out. Other startups in this space include AiFi and Trigo.
Grabango has signed deals with grocers including Aldi and Giant Eagle, along with convenience store chains 7-Eleven and Circle K. Amazon has targeted its Just Walk Out service at convenience stores and retailers at airports, stadiums and hospitals, among other places.
Amazon in April pulled cashless payment technology from its U.S. Fresh stores and Whole Foods supermarkets. In a blog post following the decision, Glaser said Amazon's reliance on shelf sensor technology in its JWO system “proved to be an Achilles' heel.” Grabango eschewed shelf sensors in favor of computer vision, putting it on a path to “mass adoption,” Glaser said.
“This is the classic story of the tortoise and the hare, but with players taking on surprising roles,” Glaser wrote. “The larger Amazon made early inroads, but was unable to turn it into a sustained success. Ironically, the more nimble company, Grabango, took the more difficult technical path, and is now reaping the rewards of its patience with a fundamentally more capable company. System.”
— CNBC's Ari Levy contributed to this report.
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