I still remember the first robotics pitch I ever saw. A team of brilliant PhDs from Stanford, with a demo straight out of a sci-fi movie: a robotic arm that could assemble a watch. I was so blown away I wrote them a check for $100,000 on the spot. And I lost every single penny.
That was my first, and most expensive, lesson in robotics investing: a cool demo doesn’t make a business. It’s a lesson I’ve learned over and over again in the years since, as I’ve invested over $1 million of my own money into robotics startups. I’ve seen it all: the brilliant successes, the spectacular failures, and everything in between. And I’ve learned a few things along the way.
Here are 10 of the most important lessons I’ve learned after investing in the wild world of robotics.
1. The “Last 10%” is Everything
That first startup I invested in? They had the first 90% of the problem solved. Their robot could assemble a watch, but only in a perfectly controlled environment. The lighting had to be just right. The parts had to be in the exact same position every time. The slightest variation, and the whole thing would fall apart.
They never solved that last 10%. And that’s the story of so many robotics companies. They get a demo working, and they think they’re on the home stretch. But that last 10%—the part where you make it work in the real world, with all its messiness and unpredictability—that’s the hardest part. And it’s where most companies fail.
2. Software is Eating the Robot
When I first started investing in robotics, it was all about the hardware. Who had the most precise arm? The strongest gripper? The fastest motor? But over the past few years, I’ve seen a dramatic shift. Today, it’s all about the software.
Take a look at what’s happening with Tesla’s Optimus. The hardware is impressive, sure. But what’s really going to make or break that project is the AI. Can they create a system that can learn and adapt to new tasks on its own? That’s the billion-dollar question. The same is true for autonomous vehicles. The hardware is largely a commodity at this point. It’s the software—the perception, the planning, the decision-making—that’s the real differentiator. That’s why I’m so bullish on companies that are focused on the software side of robotics. They’re the ones who are going to build the truly transformative businesses.
3. Vertical is Better Than Horizontal
There’s a temptation in robotics to try to build a general-purpose robot that can do everything. It’s a noble goal, but it’s a recipe for disaster. The problem is that the real world is just too complex. A robot that can do everything is a robot that can’t do anything particularly well.
That’s why I’m a huge believer in vertical-specific robotics companies. These are companies that are focused on solving a single problem in a single industry. Think about surgical robots. These are highly specialized machines that are designed to do one thing: help surgeons perform minimally invasive procedures. And they’re incredibly good at it. They’ve revolutionized the field of surgery and created a multi-billion dollar market. I’ve seen the same pattern play out in other industries as well. Agriculture, logistics, construction—the most successful robotics companies are the ones that are laser-focused on a specific vertical.
4. The Human is the Killer App
For a long time, the goal in robotics was to build fully autonomous systems that could operate without any human intervention. But what I’ve learned is that in many cases, the most powerful and effective systems are the ones that are designed to work with humans, not replace them.
Think about it. Humans are incredibly good at certain things. We’re creative, we’re adaptable, and we have a level of common sense that’s still far beyond the reach of any AI. Robots, on the other hand, are good at other things. They’re strong, they’re precise, and they can work 24/7 without getting tired.
When you combine the two, you get something that’s far more powerful than either one on its own. That’s why I’m so excited about the new wave of collaborative robots, or “cobots,” that are designed to work alongside humans in a shared workspace. These are the robots that are going to have the biggest impact on the world in the years to come.
5. The Data is the Moat
In the world of AI, data is everything. The more data you have, the better your models will be. And the better your models are, the more customers you’ll attract. It’s a virtuous cycle. And it’s a powerful moat that can protect your business from competitors.
This is especially true in robotics. A robot is essentially a data-gathering machine. It’s constantly collecting information about the world around it through its sensors. And that data can be used to train and improve its AI.
That’s why I’m always looking for robotics companies that have a clear strategy for collecting and leveraging data. These are the companies that are going to be able to build a sustainable competitive advantage in the long run.
6. The Edge is Where the Action Is
For a long time, the conventional wisdom in robotics was that you needed to have a powerful computer in the cloud to do all the heavy lifting. The robot would just be a dumb terminal that would stream data to the cloud and receive commands back.
But that’s starting to change. With the rise of powerful and efficient processors, it’s now possible to do a lot of the AI processing on the robot itself, at the “edge.” And that’s a huge deal. It means that robots can be more responsive, more reliable, and more secure. They can operate in environments where there’s no internet connectivity. And they can make decisions in real-time, without having to wait for a response from the cloud.
I’m a huge believer in the power of edge computing in robotics. And I’m always on the lookout for companies that are pushing the boundaries of what’s possible at the edge.
7. The Service Model is the Future
Robots are expensive. A state-of-the-art industrial robot can cost hundreds of thousands of dollars. And that’s a huge barrier to adoption for many companies, especially small and medium-sized businesses.
That’s why I’m so excited about the rise of the “robots as a service” (RaaS) model. With RaaS, companies can lease a robot for a monthly fee, just like they would lease a car. It’s a much more affordable and flexible way to get started with robotics. And it’s going to be a huge driver of adoption in the years to come.
I’m a big fan of the RaaS model. And I’m always looking for companies that are using it to make robotics more accessible to a wider range of customers.
8. The Unsexy is the Sexy
Everyone wants to invest in the next Boston Dynamics. The robots that can do backflips and dance to Bruno Mars. And I get it. It’s exciting. But the truth is, the real money in robotics is being made in the unsexy, unglamorous corners of the market.
Think about it. What’s more valuable: a robot that can do a backflip, or a robot that can clean a toilet? A robot that can dance, or a robot that can pick and pack orders in a warehouse? The answer is obvious. The real value is in solving real-world problems. And those problems are often the ones that are the most boring and mundane.
So if you’re looking to invest in robotics, don’t be afraid to get your hands dirty. The biggest opportunities are often in the places where no one else is looking.
9. The Team is Everything
This is true for any startup, but it’s especially true in robotics. Robotics is hard. It’s a multi-disciplinary field that requires expertise in mechanical engineering, electrical engineering, computer science, and more. And it’s a field that’s constantly evolving.
That’s why the team is so important. You need a team of people who are not only brilliant, but also resilient, adaptable, and able to work together to solve incredibly complex problems. You need a team that’s obsessed with the problem they’re solving. And you need a team that’s not afraid to fail.
When I’m evaluating a robotics startup, the team is the first thing I look at. And it’s the most important factor in my investment decision.
10. The Revolution is Just Getting Started
Despite all the progress we’ve made in robotics over the past few years, the truth is, we’re still in the very early innings of this revolution. The technology is still in its infancy. And the biggest opportunities are still ahead of us.
I’m more excited about the future of robotics than I’ve ever been. I believe that we’re on the cusp of a new era of innovation that’s going to transform every industry and every aspect of our lives. And I can’t wait to see what happens next.
Frequently Asked Questions
Are these recommendations still relevant in 2026?
Absolutely. While specific tools and tactics change, the underlying principles remain consistent. I update my thinking regularly based on what I'm seeing in the market and across my portfolio companies.
Which item on this list has the highest impact?
It depends on your stage and context, but in my experience, the items near the top of the list tend to have the broadest applicability. That said, sometimes the less obvious items create the biggest breakthroughs for specific situations.
How were these items selected?
Each item on this list comes from direct experience, either from building my own companies or from patterns I've observed across the 200+ startups I've invested in. I prioritize practical, actionable items over theoretical concepts.
How do I know which items apply to my situation?
Start by honestly assessing where your biggest bottleneck is right now. The items that address that specific constraint will give you the highest return on your time and energy.