Cashierless tech firm Grabango, launched as an adversary to Amazon’s “Just Walk Out” technology, announced its shutdown due to its inability to raise critical funding. Launched in 2016, Grabango built on some advanced checkout-free solutions using computer vision and machine learning. It wanted to revolutionize in-store shopping by removing all lines and traditional checkouts, having already secured partnerships with major retailers such as Aldi, Giant Eagle, and Circle K.
Even raising over $73 million, Commerce Ventures, Unilever Ventures, as well as Founders Fund of Peter Thiel, saw Grabango fail to raise additional capital in a tightening funding environment. The company’s largest round of funding in 2021 edged at $39 million and took its rise as one of the main contestants in the fast-emerging cashierless tech space. However, the macroeconomic environment and a sharp decline in venture capital availability post-2022 severely tested its viability for long-term survival.
Ultimately, the heart of Grabango’s technology was at variance with Amazon’s in that Grabango selected a far more complex system that relied on computer vision, rather than the shelf sensors Amazon uses. Founder and chief executive Will Glaser argued that his approach, though technically more challenging to get started, would be more scalable in the long term. Glaser touted the advantages of the company’s system, pointing out how Amazon’s reliance on shelf sensors was a huge limitation, a point he highlighted when the tech giant yanked back its cashierless technology from U.S. Fresh stores and Whole Foods locations earlier this year.
Despite all these successes, however, the company was still facing growing roadblocks. Tightening venture capital left many startups, including Grabango, unable to attract new funding, especially in sectors that required heavy upfront capital investments such as tech infrastructure. In fact, though hopes were high on taking Grabango public within the following years, the IPO market had its downturn since 2022 that derailed those plans.
That space remains competitive, including Amazon, AiFi, and Trigo, among other players, and the shutdown of Grabango warns of the difficulties of scaling innovative retail tech as economic conditions shift and investor interest falters.
The shutdown of Grabango serves as a symbol of the broader challenges many startups are facing in this economic climate. Broadly speaking, issues similar to those affecting Grabango are being faced by venture-backed companies across other sectors, and even those with the most promising technologies without continued financial backings can struggle to survive. Even such a prominent player’s shutdown broadly impacts the rate of innovation in adoption for the technologies across the retail landscape.
Acquiring Grabango is a landmark moment for the tech sector in cashierless space. It received so much interest and had technologically savvy features, but its company closure shows how even strong innovation cannot resolve funding constraints and dynamics in the market. Well, it was about time for some outcome in areas like this because of the retailers’ and investors’ expectation to know how giants like Amazon and Trigo are destined to respond to the new ways and how the future will look for cashierless technology in shopping.
