Smart retail solution powerhouse Cloudpick attracts investment to scale operations, expand staff complement.
“Although physical retail stores are still mainly operated by humans, we still firmly believe that it has become an irreversible trend to use AI and other digital technologies to empower offline physical businesses…“– Jeff Feng, Cloudpick founder and CEO.
LEADING smart retail solution provider Cloudpick has secured additional investment from investors which it will use to increase its staff complement, drive development within the local smart retailing store market and expand its operation.
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The latest funding round is another win for Cloudpick after the company recently secured investment by Intel Capital and Cathay Innovation.
The most recent investment emerged from a recent round of funding led by a CVC fund, jointly operated by the famous Japanese company Seiko Epson Corporation and Japan’s leading venture capital institution Global Brain, as well as Uzabase’s venture capital department UB Ventures.
The capital injection could not have arrived at a better time for Cloudpick as it continues to experience growth into the third year of the pandemic.
Founded in 2017, the company has the vision to improve the happiness of consumers and employees with its multi-dimensional space perception and digital twin technology. The company is committed to leading the technological breakthrough of the core knowledge of artificial intelligence and building an affordable market-ready solution in the retail industry.
The company has an impressive track record of success in the market. To date it has launched over 250 stores worldwide, among which the total number of registered users is more than 5 million. The number of orders has grown to over 15 million. The Gross Merchandise Value (GMV) generated by the seamless payment system is over US$32-million. They have more than 100 customers, including leading retailers, brands, information system integrators, airports, and well-known universities.
Cloudpick’s solution delivers proven accuracy while simultaneously reducing costs for computation. The leading technology empowers autonomous stores to leverage higher computing power devices with less, and lower hardware costs to launch.
Cloudpick founder and CEO Jeff Feng, said, “The store deployment cycle is less than one week, which puts us three years ahead of our peers, particularly with a high accuracy rate for checkout.”
It is reported that the speed of its automatic checkout can reach three-to-five times more than a traditional manual cash register, to help retailers save about 80% of labour costs per store.
Meanwhile, an autonomous store can process 800 customer requests an hour, 15,000 orders a day, and reduce theft or damage by US$1000 monthly.
Based on inventory out-of-stock reminders and replenishment control, the product turnover rises by 11% while the amount of scrap turns down by 50%. In addition, depending upon the added value, like shopping behavior analysis, precision marketing, and omnichannel commerce, a smart retailing solution can increase sales up to 200%.
Feng sees the autonomous store as a digital reinvention of traditional physical stores and says these stores can be customised to suit and enhance numerous environments including offices, hotels, and sports stadiums, etc.
The Cloudpick executive believes there’s potential within the unattended or underserved markets and communities where labour costs increase and millennials are not willing to handle repetitive tasks.
He said, “Today, various factors are driving the rapid development of the traditional retail industry, including the impact of e-commerce, and the higher demands of Generation Z for convenience in the past two years. The emergence of automated stores has become an irreversible trend to use intelligent technologies to empower brick-and-mortar stores.”
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The investors
Epson X Investment Corporation (EXI) is a corporate venture capital (CVC) firm. It is wholly owned by Seiko Epson Corporation, information equipment, and precision products manufacturer.
Epson joined forces with general partner Global Brain Corporation, an independent venture capital company with expertise in CVC management, to form a fund (the EP-GB Investment Limited Partnership) and carry out investment activities.
Global Brain is a venture capital firm that invests in companies from seed/early to pre-IPO start-ups. As one of Japan’s largest venture capital companies, Global Brain invested in Japanese unicorn company Mercari, which is the largest C2C online marketplace in Japan.
Yasuhiko Yurimoto, President & CEO, Global Brain Corporation, said: “We highly recognize its management team with strong business and academic background, the leading market solution and expanding retail x AI market. Through this investment, Global Brain together with Epson X Investment Corporation will support the further solution development and business expansion with Cloudpick.”
Founded in 2018, UB Ventures specializes in SaaS, Metaverse, and AIoT areas. Leveraging its extensive experience in the creation of both B2B and B2C subscription businesses, UB Ventures provides support to B2B/SaaS and digital media start-ups to foster sustainable relationships with their users through subscriptions, helping them to grow alongside their users.
Based on this funding and endorsement of these well-known investors, Cloudpick will accelerate the development of the global market focus on the Japanese market.
Japan’s retail revolution
Convenience stores are located almost everywhere in Japan and operate 24 hours. There are over 10,000 convenience stores in Tokyo city and over 51,000 in the whole country today according to Medium’s report[1].
Cloudpick points to Japan’s strong convenience store culture and the fact that the country takes seriously product quality control. Japan’s growing labour shortage threatens the nation’s ubiquitous convenience stores, whose business model relies on an army of part-timers packing bento lunch boxes, manning cash registers, and delivering goods 24/7.
The industry hopes the technology can overcome the shortfall.
Last year Cloudpick and NTT Data jointly launched the largest autonomous store Catch & Go for Daiei (a subsidiary of AEON Group) in Japan.
Feng added, “Cloudpick has a great appeal to multiple top-notch Japanese companies for the further needs and pain points of the Japanese convenience industry in which the labour shortage and labour costs growth caused by a rapidly aging population.”
Daiwa Tsushin Group opened Japan’s first anti-epidemic unmanned store powered by Cloudpick, adapting to the next normal in retail. Automated checkout meets people’s ever-evolving customer experience requirements of contactless shopping in the post-epidemic era.
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Stationery giant PLUS Corporation launched Cloudpick powered digital shelves in Japan to create a personalized and immersive shopping experience for its customers. According to Plus, sales of the product increased and was ten times higher than the store’s previous performance.
Chiamin Lai, Managing Partner, UB Ventures, said, “The labour shortage and industry growth slowdown caused by the declining birth-rate and aging is becoming more and more serious. It is essential to use technology to improve operational efficiency, that is to fundamentally innovate the way of operating physical stores. The autonomous retail solution created by Cloudpick is going to drive the digital upgrade of physical retail, and contribute significantly to the retail industry.”
Japan is not the only country facing the aging population issue. According to the United Nations 65-year-olds account for 7% of the total world population.
Until today, 91 countries including Germany, France, Hungary, Singapore, the United Kingdom, and the United States have entered an aging society, more and more countries are constrained by the repeated “shrinking” of the labour force and the corresponding increase in labour costs.
At the same time, the global population is more concentrated in megacities, which also makes it difficult to recruit workers for retailers in certain places.
“Although physical retail stores are still mainly operated by humans, we still firmly believe that it has become an irreversible trend to use AI and other digital technologies to empower offline physical businesses,” Feng said, “we have already discovered this trend in many countries and regions with our clients.”
Looking ahead Cloudpick will contribute to the smart retail revolution under the support of funds, resources with the new round of funding. Except for autonomous stores, Cloudpick will scale other products, such as intelligent management systems, digital shelves, AI vending machines, Moby Mart, and delivery robots. The evolution of digital technology enables retailers to embrace changes with a smarter and more efficient business model.