Amazon Bolsters Robotics AI Capabilities with Covariant Founders Hire and Licensing Deal

Amazon hires the founders of AI robotics startup Covariant | TechCrunch

Amazon announced Friday evening that it has hired Covariant's founders -- Pieter Abbeel, Peter Chen, and Rocky Duan -- along with "about a quarter" of the startup's employees. It's also signed a non-exclusive license to use Covariant's robotic foundation models. Earlier this year, Chen told TechCrunch that Covariant is building "a large language model, but for robot language." In other words, it's creating AI models for robots, with an initial focus on robotic arms performing common warehouse tasks like bin picking. "With some of the smartest minds, we will advance fundamental research, marrying our rich expertise to unlock new ways for AI and robots to assist our operations employees," said Joseph Quinlivan, Vice President of Amazon Fulfillment Technologies & Robotics, in a statement. "[Embedding] Covariant's AI technology into our existing robot fleet will make them more performant and create real world value for our customers." The deal sounds similar to Amazon's hiring of the founders of AI startup Adept back in June -- another deal that gave Amazon access to new talent and technology without having to fully acquire an existing startup. At the time, The Verge described this approach as a "reverse acquihire," where tech giants facing antitrust scrutiny can use hiring and licensing deals to disguise their acquisitions, rather than the other way around. Covariant, meanwhile, said it will continue operating under the leadership of Ted Stinson and Tianhao Zhang, with Stinson -- who'd been the startup's COO -- now stepping into the CEO role. The company added that it remains "dedicated to delivering the Covariant Brain into production environments across a broad set of global industries, including apparel, health and beauty, grocery, and pharmaceuticals."

Amazon hires Covariant founders, inks licensing deal with AI startup in latest 'reverse acquihire'

Amazon is acquiring the founders from Covariant, a Bay Area startup that develops AI software for robotic picking machines. As part of the deal, announced late Friday just before the holiday weekend, Amazon will receive a non-exclusive license to Covariant's AI models. Covariant will continue operating, but the company's co-founders -- former OpenAI researchers Peter Chen, Pieter Abbeel, and Rocky Duan -- along with other team members will join Amazon. The deal structure is similar to what Amazon did in June when it hired the founders of Adept, a well-funded startup building AI agents that automate enterprise workflows. Amazon also struck a licensing deal with Adept. Other tech giants are using a similar strategy to add AI heavyweights to their workforce, including Microsoft, which earlier this year hired Mustafa Suleyman, co-founder and former CEO of consumer chatbot startup Inflection AI, along with Inflection co-founder Karén Simonyan and other employees. These deals are essentially "reverse acquihires," said Alex Heath, deputy editor at The Verge, in a post in July, describing the combination of the hires and the licensing deal as an acquisition in disguise. Regulators have been paying closer attention to AI deals between tech giants and smaller startups. Amazon has reportedly drawn questions from the U.S. Federal Trade Commission related to the Adept deal. Semafor reported this month that Adept's investors recouped their investment in the company, even though Adept was not acquired by Amazon. Emeryville, Calif.-based Covariant, founded in 2017, focuses on AI-powered robotics systems, based on a platform that it calls the "Covariant Brain." It automates warehouse tasks including order picking and sortation, item induction, and depalletization. In its marketing materials, Covariant likes to use one of Amazon's signature phrases to tout the immediacy of its impact, saying its AI platform delivers value on "Day One." Covariant's customers include healthcare supply manufacturer McKesson, German retail giant Otto Group, and Radial, an e-commerce fulfillment solution company. Amazon has rolled out a series of warehouse robots of its own across its operations, seeking to automate the process of moving products and packages through its fulfillment and sortation centers. Bloomberg last month reported on a potential deal between Covariant and Amazon, noting that it could help centralize Amazon's fulfillment center automation robots through one platform. The deal comes as Amazon faces growing scrutiny over the safety of its warehouse operations and continues to push to achieve faster delivery times. A widely cited 2019 report by the Center for Investigative Journalism showed a higher injury rate at Amazon's robotic fulfillment centers than at its older facilities at the time, indicating that human workers were struggling to keep up. Amazon disputes this assertion. Numbers provided by the company to GeekWire last year indicated that recordable incident rates and lost-time incident rates were 15% and 18% lower, respectively, at Amazon Robotics sites than they were at its non-robotics sites in 2022. "I want to eliminate the mundane, and the tedious, and the repetitive," said Ty Brady, the chief technologist for Amazon Robotics in a 2023 interview with GeekWire. "I want to make things safer inside our fulfillment centers. I don't want folks to have to lift heavy boxes and crouch down on their knees or reach over their shoulders. And if we can have robotic systems to do that, that's a win for everybody." Covariant has raised $222 million in funding, including $75 million in a Series C round in April 2023, led by Radical Ventures and Index Ventures, and joined by Canada Pension Plan Investment Board, Amplify Partners, Gates Frontier Holdings, AIX Ventures, and Northgate Capital. The round reportedly valued Covariant at $625 million. Covariant has more than 160 employees, according to LinkedIn. Amazon said about 25% of the company's workforce is joining the company's Fulfillment Technologies & Robotics team. Financial terms of the deal were not disclosed. "Covariant's models will help drive new ways to generalize how our robotic systems learn and provide dynamic opportunities for how we use automation to make our operations safer and better deliver for customers," Amazon said in a blog post.

Amazon to hire founders of robot software maker firm to improve warehouse automation

Amazon (NASDAQ:AMZN) is hiring the founders of robot software maker Covariant and licensing the company's robotic foundation models to improve its warehouse automation. The e-commerce giant will absorb founders Pieter Abbeel, Peter Chen, Rocky Duan, and around a quarter of Covariant's current employees into its Fulfillment Technologies & Robotics Team, Amazon (AMZN) said in a blogpost. Through its commercial agreement with Covariant, Amazon (AMZN) will receive a non-exclusive license to Covariant's robotic foundation models. Amazon (AMZN) added that it plans to grow its AI and robotics team in the Bay Area. Launched in 2017, the Bay Area-based company has raised over $222 million in total funding. It counts Temasek, CPP Investments, Radical Ventures and Index Ventures as some of its investors. In early August, Bloomberg had reported that Covariant had received takeover interest from Amazon (AMZN). Amazon (AMZN) has dominated the warehouse automation space since 2012 with its acquisition of Kiva Systems, a company that builds robots that zip around warehouses to help move products. The Seattle, Washington-based company has also invested in robotics firms Instock, Agility Robotics and Standard Bots.

Covariant Founders Will Join Amazon in Latest Acqui-Hire

Amazon has hired the founders of the industrial robotics company Covariant, the e-commerce giant announced in a blog post on Friday. The deal follows a trio of other acqui-hires, including Microsoft's acquisition of artificial intelligence company Inflection's founders and most of its staff in March. It's unclear what Amazon is paying for the startup, which was valued at $625 million in an