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Uber Plans to Turn Delivery Robot Operation into Separate Startup

Published on Mar 4, 2021 at 8:55 am in News.

Uber continues to narrow its focus as it releases plans to turn Postmates’ delivery robot operation into a separate startup. According to Bloomberg, Uber will co-lead a $50,000 investment in the new delivery startup Serve Robotics. The delivery company will bring food, groceries, and other items to Uber customers without human interaction.

Serve Robotics will be led by Ali Kashani, who currently runs the robot deliveries unit for Postmates. The company will start with 60 employees based in San Francisco. While it will operate independently from Uber, it will retain close ties with the former parent company.

Over the course of the next five years, Serve Robotics plans to expand its current fleet of robots from dozens to thousands. Within those five years, Kashani believes Serve Robotics robots could make five percent of food deliveries in the United States.

Uber will take stake in Serve Robotics, as it has with other abandoned business efforts like Grab in South East Asia and Zomato in India. The rideshare giant is currently under pressure from investors to turn its first-ever profit, as the pandemic continues to impact the bottom line negatively.

Uber will act as both an investor and major commercial partner for Serve Robotics. As food delivery continues to grow quickly, there’s a push to expand into delivering groceries, prescriptions, packages, and more. With robots to handle some of those deliveries, it’s likely Uber’s margins could improve, and the company could make more of a profit.

Prior to Uber purchasing Postmates and subsequently breaking away from Serve Robotics, Postmates partnered with convenience store Pink Dot. At the time, the company’s three robots, Pinky, Dotty, and Solly, delivered thousands of sandwiches, drinks, cleaning supplies, and other items in Los Angeles.

Initially, Pink Dot’s CEO Sol Yamini was skeptical about the usage of robots but now says replacing human delivery drivers with robots is a goal: “We’re already paying so much for as, payroll, worker’s comp, insurance on vehicles, and payroll tax, and it just keeps going up. Robots will help our bottom line.”