A once-promising robotics start-up backed by Ocado has been sold off at a significant loss, fetching only £350,000.
- Founded in 2018, the start-up developed innovative kitchen automation, including a robotic chef and fryer.
- Despite raising £13 million from Ocado and the Future Fund, the company collapsed in June.
- Attempts to recapitalise the firm failed amidst a challenging economic climate and diminished venture investment.
- The sale reflects broader industry challenges and the financial strain on start-ups post-pandemic.
A once-promising robotics start-up, supported heavily by Ocado, was recently sold for a mere £350,000, a considerable decline from its prior valuation. The company, initiated in 2018 by entrepreneur Barney Wragg, was at the forefront of kitchen automation technology, having developed a robotic chef designed specifically for noodle preparation and an automatic fryer that was tested with restaurant chain Nando’s.
The start-up successfully raised £13 million from Ocado and the UK government-backed Future Fund, aimed at assisting start-ups during the pandemic under the guidance of Rishi Sunak. However, despite these substantial financial injections, the company entered administration in June, citing an inability to secure further external funding essential for business expansion.
In an atmosphere of dwindling venture capital, the start-up expended £3.3 million in 2022, a factor that contributed to its financial downfall. Accountancy firm RSM was engaged to explore potential administrative solutions, yet efforts to recapitalise the business fell through.
Founder Mo Khodadadi highlighted the advanced capabilities of the start-up’s technology, particularly its cameras, which could identify human presence, food items, and packaging, noting: “This camera understands humans, it understands food items, it also understands packaging.” Nevertheless, these technological advancements were insufficient to attract the necessary investment to sustain operations.
Damian Webb from RSM commented: “Karakuri explored all available options to secure the available funding to take it to profitability. Regrettably, the current economic landscape undermined these efforts.” This situation reflects a broader trend within the start-up ecosystem, where financial sustainability remains elusive for numerous ventures despite innovative achievements.
The sale of this innovative robotics start-up underscores the formidable challenges faced by technology ventures in securing financial stability amidst economic uncertainties.
