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The Valley’s affinity for robotics shows no signs of cooling. Technical enhancements through innovations like AI/ML, compute power and big data utilization continue to drive new performance milestones, efficiencies and use cases.

Despite the old saying, “hardware is hard,” investment in the robotics space continues to expand. Money is pouring in across robotics’ billion-dollar sub verticals, including industrial and labor automation, drone delivery, machine vision and a wide range of others.

According to data from Pitchbook and Crunchbase, 2018 saw new highs for the number of venture deals and total invested capital in the space, with roughly $5 billion in investment coming from nearly 400 deals. With robotics well on its way to again set new investment peaks in 2019, we asked 13 leading VCs who work at firms spanning early to growth stages to share what’s exciting them most and where they see opportunity in the sector:

• Shahin Farshchi, Lux Capital
• Kelly Chen, DCVC
• Rob Coneybeer, Shasta Ventures
• Aaron Jacobson, NEA
• Eric Migicovsky, Y Combinator
• Helen Liang, FoundersX Ventures
• Andrew Byrnes, Micron Ventures
• Ludovic Copéré Sony Innovation Fund
• Costantino Mariella, Sony Innovation Fund
• Cyril Ebersweiler, SOSV & HAX
• Peter Barrett, Playground Global
• Bruce Leak, Playground Global
• Jim Adler, Toyota AI Ventures

Participants discuss the compelling business models for robotics startups (such as “Robots as a Service”), current valuations, growth tactics and key robotics KPIs, while also diving into key trends in industrial automation, human replacement, transportation, climate change, and the evolving regulatory environment.

Shahin Farshchi, Lux Capital

Which trends are you most excited in robotics from an investing perspective?

The opportunity to unlock human superpowers:

• Increase productivity to enhance creativity leading to new products and businesses.
• Automating dangerous tasks and eliminating undesirable, dangerous jobs in mining, manufacturing, and shipping/logistics.
• Making the most deadly mode of transport: driving, 100% safe.

How much time are you spending on robotics right now? Is the market under-heated, overheated, or just right?

• Three-quarters of the new opportunities I look at involve some sort of automation.
• The market for robot startups attempting direct human labor replacement, floor-sweeping, and dumb-waiter robots, and robotic lawnmowers and vacuums is OVER heated (too many startups).
• The market for robot startups that assist human workers, increase human productivity, and automate undesirable human tasks is UNDER heated (not enough startups).

Are there startups that you wish you would see in the industry but don’t? Plus any other thoughts you want to share with TechCrunch readers.

I want to see more founders that are building robotics startups that:

• Solve LATENT pain points in specific, well-understood industries (vs. building a cool robot that can do cool things).
• Focus on increasing HUMAN productivity (vs. trying to replace humans).
• Are solving for building interesting BUSINESSES (vs. emphasizing cool robots).

Kelly Chen, DCVC

Three years ago, the most compelling companies to us in the industrial space were in software. We now spend significantly more time in verticalized AI and hardware. Robotic companies we find most exciting today are addressing key driver areas of (1) high labor turnover and shortage and (2) new research around generalization on the software side. For many years, we have seen some pretty impressive science projects out of labs, but once you take these into the real world, they fail. In these changing environmental conditions, it’s crucial that robots work effectively in-the-wild at speeds and economics that make sense. This is an extremely difficult combination of problems, and we’re now finally seeing it happen. A few verticals we believe will experience a significant overhaul in the next 5 years include logistics, waste, micro-fulfillment, and construction.

With this shift in robotic capability, we’re also seeing a shift in customer sentiment. Companies who are used to buying outright machines are now more willing to explore RaaS (Robot as a Service) models for compelling robotic solutions – and that repeat revenue model has opened the door for some formerly enterprise software-only investors. On the other hand, companies exploring robotics in place of tasks with high labor shortages, such as trucking or agriculture, are more willing to explore per hour or per unit pick models.

Adoption won’t be overnight, but in the medium term, we are very enthusiastic about the ways robotics will transform industries. We do believe investing in this space requires the right technical know-how and network to evaluate and support companies, so momentum investors looking to dip their hand into a hot space may be disappointed.

Rob Coneybeer, Shasta Ventures

We’re entering the early stages of the golden age of robotics. Robotics is already a huge, multibillion-dollar market – but today that market is dominated by industrial robotics, such as welding and assembly robots found on automotive assembly lines around the world. These robots repeat basic tasks, over and over, and are usually separated by caged walls from humans for safety. However, this is rapidly changing. Advances in perception, driven by deep learning, machine vision and inexpensive, high-performance cameras allow robots to safely navigate the real world, escape the manufacturing cages, and closely interact with humans.

I think the biggest opportunities in robotics are those which attack enormous markets where it’s difficult to hire and retain labor. One great example is long-haul trucking. Highway driving represents one of the easiest problems for autonomous vehicles, since the lanes tend to be well-marked, the roads have gentle curves, and all traffic runs in the same direction. In the United States alone, long haul trucking is a multi-hundred billion dollar market every year. The customer set is remarkably scalable with standard trailer sizes and requirements for shipping freight. Yet at the same time, trucking companies have trouble hiring and retaining drivers. It’s the perfect recipe for robotic opportunity.

I’m intrigued by agricultural robots. I’ve seen dozens of companies attacking every part of the farming equation – from field clearing and preparation, to seeding, to weeding, applying fertilizer, and eventually harvesting. I think there’s a lot of value to be “harvested” here by robots, especially since seasonal field labor is becoming harder to find and increasingly expensive. One enormous challenge in this market, however, is that growing seasons mean that the robotic machinery has a lot of downtime and the cost of equipment isn’t as easily amortized in other markets with higher utilization. The other big challenge is that fields are very, very tough on hardware and electronics due to environmental conditions like rain, dust and mud.

There are a ton of important problems to be solved in robotics. The biggest open challenges in my mind are locomotion and grasping. Specifically, I think that for in-building applications, robots need to be able to do all the thing which humans can do – specifically opening and closing doors, climbing stairs, and picking items off of shelves and putting them down gently. Plenty of startups have tackled subsets of these problems, but to date no one has built a generalized solution. To be fair, to get to parity with humans on generalized locomotion and grasping, it’s probably going to take another several decades.

Overall, I feel like the funding environment for robotics is about right, with a handful of overfunded areas (like autonomous passenger vehicles). I think that the most overlooked near-term opportunity in robotics is teleoperation. Specifically, pairing fully automated robotic operations with occasional human remote operation of individual robots. Starship Technologies is a perfect example of this. Starship is actively deploying local delivery robots around the world today. Their first major deployment is at George Mason University in Virginia. They have nearly 50 active robots delivering food around the campus. They’re autonomous most of the time, but when they encounter a problem or obstacle they can’t solve, a human operator in a teleoperation center manually controls the robot remotely. At the same time. Starship tracks and prioritizes these problems for engineers to solve, and slowly incrementally reduces the number of problems the robots can’t solve on their own. I think people view robotics as a “zero or one” solution when in fact there’s a world where humans and robots work together for a long time.

The New York Stock Exchange filed paperwork this morning with the U.S. Securities and Exchange Commission to allow companies to raise capital as part of a direct listing.

Direct listings are a way for companies to go public by selling existing shares held by insiders, employees and investors directly to the market, rather than the traditional method of issuing new shares. Direct listings have become increasingly popular since Spotify’s 2018 exit, which allowed its employees immediate liquidity, removed preferred access from bankers and allowed for market-driven price discovery. Companies, like Spotify, that opt to complete a direct listing are able to bypass the financial roadshow, thus avoiding some of Wall Street’s exorbitant fees. Historically, however, these companies have not been able to raise fresh capital as part of the process.

The NYSE’s new proposal seeks to change that. Specifically, the stock exchange plans to amend Chapter One of the Listed Company Manual, which outlines the NYSE’s initial listing requirements for companies completing initial public offerings or direct listings. If the amendment is approved—the NYSE is subject to the regulatory oversight of the SEC—companies going public on the NYSE will be permitted to raise capital through a direct listing.

The proposed hybrid model is likely to appeal to Silicon Valley tech startups, who’ve grown more familiar with the innovate route to the public markets following Spotify and Slack’s direct listings. On the backs of these exits, tech industry leaders have touted direct listings as the latest and greatest path to the public markets. Venture capitalist Bill Gurley, in particular, has encouraged companies to consider the method. Meanwhile Silicon Valley darling Airbnb, which has stated its intent to go public in 2020, is said to be considering a direct listing rather than a traditional IPO.

Gurley, who has expressed his discontent with bankers’ inability to adequately price IPOs, recently hosted a one-day conference focused on direct listings titled Direct Listings: A Simpler and Superior Alternative to the IPO. The event was attended by members of tech’s elite, including Sequoia Capital’s Mike Moritz and Spotify chief financial officer Barry McCarthy .

Gorgias, a startup offering artificial intelligence tools for customer service and support, is announcing that it has raised $14 million in Series A funding.

Co-founder and CEO Romain Lapeyre told me that the startup (whose name is pronounced “gorgeous”) is taking advantage of a broader shift as brands are looking to sell directly to consumers, rather than going through intermediaries like Amazon — for example, he pointed to Nike’s recent decision to pull its products from Amazon.

As brands make this change, Lapeyre (pictured above with his co-founder and CTO Alex Plugaro) said they need a “bundle of tools” to build their online business, and “each little part of the bundle is separate.” So they might create a store with Shopify, accept payments via Stripe — and naturally, Lapeyre believes they should be handling their customer support through Gorgias .

The product integrates with Shopify, using AI and customer data to automate responses to basic questions like, “What’s my tracking number?” By doing this, the business can free customer service representatives from spending most of their time responding to these routine requests, and the customers get faster answers.

“The automation should just be the very basic questions,” Lapeyre added.

But even when it comes to more complex queries, Gorgias also provides tools that help the customer service representatives to respond more quickly and to upsell customers on additional products and services — Lapeyre said they’re acting as “sales associates rather than customer service agents.”

It seems like this approach is becoming a reality at some of Gorgias’ 2,000 customers — the Groovelife customer service team gets paid a commission based on upselling. At Steve Madden, meanwhile, the customer service team is using automation to respond to 20% of tickets.

Gorgias previously raised $1.5 million in seed funding. The new round was led by Flex Capital, with participation of SaaStr, Alven, CRV, Amplify Partners and Eric Yuan.

Lapeyre said Gorgias will use the money to build out the product with new  features while also bringing on more merchants.

Earlier this year, American Express announced it was acquiring Resy, the New York-based restaurant reservation platform whose software was used by 4,000+ restaurants across 10 countries. This week, the company has taken the next step to now integrated Resy’s system within the Amex Mobile App. In a new restaurant booking feature, Resy’s inventory will be combined with the American Express Global Dining Collection and other partners, including BookTable and SevenRooms, to offer cardholders reservations from over 10,000 restaurants worldwide.

Currently, this restaurant-booking feature will be available only to a portion of Amex’s Platinum Card Member base. But American Express says the plan is to roll out the feature more broadly in the months ahead.

The company says its decision to go this route was driven by customer activity. Dining is a top spending category among cardholders and the number one request through the Platinum Concierge service — a premium perk that’s like having an assistant work for you to research travel, find gifts, or make dinner reservations, for example.

Resy fits in with Amex’s larger goal of providing services to cardholders that can help connect them to unique experiences, as its platform can be used to acquire reservations even at newer, hipper and hard to get into restaurants.

Before its acquisition, Resy’s software for restaurants had managed to steal market share away from OpenTable, thanks to its advances in table management solutions for restaurant owners, which includes features like an adaptive optimization engine, business intelligence capabilities, and the ability to combine different scheduling strategies, like slots and a more dynamic flex system. This system and the consumer-facing booking options continue to be available through Resy directly, even if users aren’t Amex members.

Resy was the latest in a string of Amex acquisitions aimed at expanding its Global Dining Program. Amex also bought Japan-based restaurant booking service Pocket Concierge in January, and U.K. fintech startup Cake Technologies, designed to help people more easily pay their restaurant bill.

More broadly, these acquisitions aim to help Amex become more central to its customers’ lives, the company had said at the time of the Resy deal. And that’s just as important as the points program.

In addition, by building more digital services into its app, Amex aims to better serve an increasingly mobile and tech-savvy audience. The company says that 84% of its card members now use the app or website to interact with the company, and it’s seen a 35% year-over-year increase in daily active American Express mobile app users globally.

The new in-app reservation booking tool will become available to the larger Platinum and Centurion Card Member base by 2020, following this week’s more limited launch.

Organizations are always looking for new ways to work more efficiently, but too often the problem is that, in a digital-first environment, they have to get in line to ask their in-house IT experts (or even more expensively, external consultants) to build those solutions for them. To underscore the demand for a better approach, today a startup that has constructed a way around that, specifically in the world of app integrations, is announcing a sizeable round of funding.

Tray.io, which has built a “general” workflow automation platform that uses a graphical interface to let anyone integrate APIs between two or more apps to create new ways of working with data across them, has raised $50 million in funding, at a valuation that a source close to the company tells me is over $600 million post-money.

The funding, a Series C, is being led by Meritech Capital, with previous investors Spark Capital, GGV Capital, and True Ventures also participating. It brings the total raised by Tray.io to just under $110 million and is notable for coming just five months after its previous round, a Series B of $37 million.

“Since we started the company we’ve been very fortunate with what’s happened in the tech world,” CEO and co-founder Rich Waldron said in an interview last week while visiting London when asked about the funding.

He said that in addition to acquisition approaches (from a number of household names) there were offers of more money coming in almost immediately after the last round closed, and the startup decided that making hay while the sun shines — that is, taking the money when it’s offered, since you don’t know what will happen tomorrow — was the right approach.

“It took us five years to build the company, and we seeded it slowly, but in the last 18 months things have exploded.” As for the sparks for that explosion, he credits the trajectories of companies like Twilio and Stripe, two other tech companies that have built large businesses on, and raised public awareness of, APIs creating new worlds of functionality; and signing on IBM as a partner: the company created a number of new integrations on the platform, some of which became standards that now other companies are using daily.

It’s been a big journey for the startup. Tray.io started out years ago with just a handful of integrations, mostly “email-centric” features, as Waldron describes them, allowing people, for example, to import data from Mailchimp into Slack to track email marketing campaigns. Now, the company provides integrations for some 400 apps, with customers ranging from small startups through to the likes of IBM, and it’s continuing to grow.

The company — which has no “free” tier, with integration packages starting at $595 per month — says that ARR is up by more than 500% this year (it does not disclose actual revenue numbers) — and its customer base is up by 37% with VMWare, Pearson, Bain & Company, Zendesk, and Udemy, SAP, Arrow Electronics, Lexmark, and New Relic among those using its services.

Typical integrations might involve apps like SAP S/4HANA, Qualtrics, Ellucian, Magento, Microsoft PowerBI and Azure, Okta, OneLogin, DropBox, Drift, Segment, Zendesk, Salesloft, Copper, Qualtrics, Intercom, and Marketo
 and alongside that Tray.io provides automation features, error handling, version management and more.

The company is now also providing a white-label version of its platform, Tray Embedded, which third parties can offer to their customers to manage integrations in their own environments.

Altogether the company today processes about 10 billion tasks each month.

Tray.io’s rise comes on the heels of a wider trend. When it comes to some of the prime ways that enterprises are leveraging the advances of technology to improve how they work, integration and automation are the name of the game: bringing data out of silos, and doing so in an instant way, speeds up operations, reduces human error and can also help with costs.

It’s not the only company working in this area, or to take the approach that technology should be accessible and used by more than just engineers another tech employees.

Others working in the automation and integration space include Snaplogic (which raised $72 million in October), Dell’s Boomi, and Workato (which itself raised $70 million earlier this month and now has a valuation of $500 million, according to PitchBook data).

Rich Waldron, Tray.io’s CEO and co-founder, said that the company likes to think of itself as something in between Mulesoft (now a part of Salesforce) and Zapier, which somewhat also puts those two companies also into the wider category of competitors.

Other non-consumer startups that are also tackling the idea of providing tech tools to non-technical employees include Airtable, Parabola, DashDash, the AI-based data parser for unstructured contracts and other legal documents Eigen, and many more.

But around all of these, Tray.io’s investors believe they have backed one of the winning horses.

“General automation is showing nonstop momentum in a software-heavy marketplace that’s hungry for integration support and efficiency lift,” explained Alex Kurland of Meritech Capital, in a statement. “The increasingly urgent need to provide a personalized and cohesive customer experience across the entire buying journey demands ongoing digital transformation. To have any hope of scaling with the exponential increase in new software and new customer data in play, companies need to take full ownership of every piece of that data with general automation. Not just in IT, but for line-of-business roles in marketing, sales, support, HR, finance, and many others across the entire organization. There’s no limit to the upside for general automation in today’s marketplace, and Tray.io is the undisputed leader in the category.”

The origin story of the startup is a notable one for those wondering how and if ecosystems can evolve.

I first met Tray.io when it was still a small startup working at a few desks donated to it by UsTwo in Shoreditch, London. The company had just raised a seed round and was on its way to relocating to San Francisco to take its growth up a gear.

That in itself was a significant stage of progress for the company: Waldron said that when he and co-founders Alistair Russell and Dominic Lewis had trouble raising its earliest funding prior to that, they financed the startup for several months by selling Wellington boots (Hunters mostly, purchased wholesale) on sites like eBay to people “during the festival season.”

Tray.io was — in the literal and figurative sense — a bootstrapped startup.

Eventually the company went through a couple of accelerators, Angelpad and Techstars, and started to catch the eye of angel investors — Passion Capital, Ballpark Ventures, Firestartr, Andy McLoughlin, Tom Hulme, Ustwo founders Mills and Sinx, FIG and Richard Fearn — who collectively put $600,000 into the startup. The seed round that I wrote about, interestingly, had come with a rider: move to San Francisco if you want the money.

“The terms that we were getting in the UK for the seed round were not good,” Waldron said. “It would have hindered our growth. But it’s not the same now. There is an amazing set of companies in the UK, building deep tech and more. This feels like the new model: you can really think big and make it.”

The startup has kept its R&D here in the UK and will continue to build out its office too, even as its HQ remains in SF.

Kasada, an anti-bot startup we profiled earlier this year, has raised $7 million in its Series A led by In-Q-Tel, the non-profit venture arm of the intelligence community.

The Sydney and Chicago-based company helps to fight online bots using its proprietary anti-bot platform Polyform.

Bots don’t just pummel websites with junk traffic to try to knock them offline, they’re used to automate fraudulent purchases and scraping content from sites like airlines and entertainers to try to undercut prices. Bots cost businesses in unnecessary web server and bandwidth costs each year.

The company’s anti-bot platform puts an unsolvable cryptographic challenge on the outer edges of a customer’s website. The platform uses fingerprinting technology to determine if a visitor is a human. If the platform detects a bot, it tricks the bot into trying to solve the impossible math puzzle, churning up server and memory resources on the server from which the bot operates and costing the bot operator in excessive cloud resources.

Kasada’s chief executive and co-founder Sam Crowther said the venture firm’s backing was a “strong validation” of its technology and its team.

The company, which launched in 2015, said it has doubled its engineering and customer-facing teams in the past year, and appointed Pascal Podvin, a former field operations executive, to help ramp up its revenue operations.

In-Q-Tel’s Peter Tague said he was “impressed” by Kasada’s technology. It also marks In-Q-Tel’s first investment in Australia after the venture firm opened an office in Sydney late last year. To date, In-Q-Tel has invested in enterprise data cloud platform Cloudera, cybersecurity giant FireEye, open-source database maker MongoDB, and surveillance software firm Palantir.

The $7 million round will help Kasada grow and expand its customer base, as the company faces increasing competition from its rivals. The fundraise comes hot on the heels of networking and content delivery giant Cloudflare launching its own anti-bot “fight mode” feature — a free opt-in offering to its customers — which the company said will help “frustrate” bots from targeting and attacking its customers.

Crowther said Cloudflare’s own efforts was a “testament” to the importance of ant-bot services, but said that Kasada covers ground where others haven’t.