Amazon + iRobot
Amazon has a very high ambition on robotics . They first started their journey in this world by creating online market place for consumers . But behind the scenes it is always manual labor which was involved.
Once they gain the popularity among consumers with the front end, then they started thinking of automating the heck out of everything. It ranged from automating warehouse efficiencies to creating drone and investing in self driving companies like zoox.
But why iRobot. It is a consumer facing company mainly selling vaccum robots and mopping robots. What amazon needed it for . Are they planning to clean their warehouses using those robots.
These robots from iRobot operates based on a algorithm called SLAM.
SLAM or Simultaneous Localization and Mapping is an algorithm that allows a device/robot to build its surrounding map and as well as detect and percieve type of objects around it. It is a very common algorithm used in autonomous vehicles or robots that allow them to map unknown surroundings. The maps can be used to carry out a task such as a path planning and obstacle avoidance for autonomous vehicles.
This slam algorithm can be modified to perceive exactly what type of objects your household has . Amazon can use this data to see what particular products you might be interested in in purchasing .
So for Amazon is a win win. iRobot itself generates around USD 1.5 billion in revenue and have access to the interior of 14 Million customer’s house. It is planning to reach around 30 Million customers by 2024.
Amazon currently have 190 Million Customer and they are producing $638 Million USD per day. Now if you add those 30 Million Customer more and assuming 50% of them are already amazon’s loyal customer you will see Amazon’s per day revenue going up to $700 Million per day.
They will also inherit the robot sales which is $1.5 Billion per year and it comes out to be another $5 Million per day.
On top of that Amazon will receive experienced robotics engineer which it self can be values at at least $5 Million per day.
So amazon paying $2 Billion for iRobot is going to be recouped in less than a year and then the future for amazon is bright and brighter………….