The Race to Build the First Real Humanoid Robot Business with Peggy Johnson from Agility

**Connie Loizos** (0:01)
Hi, I'm Connie Loizos.

**Alex Gove** (0:02)
And this is Alex Gove.

**Connie Loizos** (0:03)
And this is Strictly VC Download.
Hi, welcome back to Strictly VC Download. Humanoid robots are moving off the factory floor and onto Wall Street. Agility Robotics, the Oregon-based startup behind Digit, a bipedal robot already at work in Amazon warehouses and on Toyota assembly lines, is set to go public through a SPAC merger that values the company at roughly $2.5 billion. The deal, backed by Foxconn, Amazon, Nvidia and SoftBank, would make Agility the first stand-alone humanoid robotics company to list on public markets. At the helm is Peggy Johnson, a veteran technology executive who previously led the augmented reality company Magic Leap and who spent years at Microsoft. She's betting that a perfect storm of retiring workers, reshoring ambitions and pent up investor appetite for the robotics sector will carry Agility to the next level and beyond. We really enjoyed talking to Peggy for this week's podcast. We hope you will enjoy the conversation and we will see you back here next week.
Peggy, really a pleasure to be meeting you and talking with you now. And it turns out we've got a great news hook to lead us into this interesting story of yours. Agility is merging with Michael Klein's Churchill Capital Corp. It's a SPAC. You are set to see $620 million in gross proceeds, which is the largest capital raise in humanoid robotics history. I have to ask, why go public now and why threw a SPAC?

**Peggy Johnson** (1:49)
Sure. Yeah, we get that question often and it's a good question. We really want to take advantage of the market momentum and be the first mover in the category. There are no pure play humanoid robotics companies who've gone public. And from our perspective, we built a product where the very first to deploy commercially and we have a number of interested customers in our pipeline, and it'll help us accelerate our ability to meet those engagements.

**Connie Loizos** (2:21)
It is interesting considering the frothy-ish valuations that we're seeing in the humanoid market. I am wondering, what do you think of a company like Figure AI valued at $39 billion? Does that make sense to you?

**Peggy Johnson** (2:35)
It's really hard to even guess at what the right valuation is. I've always tried to stay very pragmatic and very focused on the here and now.
And the here and now in humanoid robots is the entry point of simple material handling. So we were valued at $2.5 billion pre the announcement that we had last week. We think that's spot on. Over time, the robot learns more skills, the robot moves into new vertical markets, and clearly, valuation increases over time. So we feel good about our valuation. We think it's the right valuation for us and for the entry point of humanoids. You know, eventually, many years from now, we'll enter into the home.
But that will bring a whole step level higher of valuation. But right now, what humanoids are capable of, from a commercial perspective, is this material handling. So we're happy to be right where we are.

**Connie Loizos** (3:38)
Specs obviously have a very complicated reputation. A lot of companies that went public through Specs in 2021 are trading well below their offering price or gone entirely. Why should investors believe that agility won't meet the same fate?

**Peggy Johnson** (3:52)
Sure, and investors certainly have the prerogative to question any of these. We feel very comfortable in our progression. We are starting with these simpler tasks, adding more skills, obviously AIs, helping us to add skills very quickly to the robot. We feel comfortable because of the demand we're seeing from our customers. You could say we're in the deep tech category. We have real demand today.
So it's not, you know, sometime in the future we'll deliver this. It's right now we have customers who need what we're building.
So we feel very confident in the pipeline and our ability to meet that demand. So if we just keep our head down, keep delivering customer by customer, robot by robot, we hopefully won't experience the same volatility that some companies have on this journey.

**Alex Gove** (4:43)
We don't yet have your revenue figures. They'll come later in the S4, but your filings show operating expenses of around 111 million last year and roughly 100 million in cash burn.
When can retail investors realistically expect this company to be profitable? What does that path look like?
And also, how do you distinguish between pilot revenue and real repeatable revenue?

**Peggy Johnson** (5:09)
So we're not offering any forward-looking guidance right now, but what I will say is that we do have over 30 interested companies in our pipeline, many with global operations, all of them struggling to fill in labor shortages that they have. It's a tough market out there. We've got a retiring workforce. We've got younger people who don't want these jobs that are more manual in nature. So what's happening with these companies, as they look at their trajectory, it's almost existential for them. They have to find a solution. We have that solution.