A robotics start-up heavily funded by Ocado has been sold for £350,000.
- Karakuri, founded in 2018, developed innovative kitchen automation technology.
- The start-up had raised £13m but collapsed in June due to funding issues.
- RSM was consulted as potential administrators when recapitalisation efforts failed.
- Founders and stakeholders expressed disappointment over economic challenges.
Karakuri, a pioneering robotics start-up established in 2018 by Barney Wragg, has been sold for a mere £350,000 despite attracting millions in investment from major players including Ocado and the taxpayer-supported Future Fund. Initially promising revolution in kitchen automation through its robotic chef for noodles and an automatic fryer, the company’s potential seemed boundless.
Despite an impressive injection of £13 million, Karakuri encountered significant hurdles. The company faced a critical juncture as external funding essential for expansion became scarce, exacerbated by the broader constriction of venture capital flow in 2022. Consequently, the firm could not sustain its operations, reporting a deficit of £3.3 million for the year.
In June, Karakuri entered administration, resulting in the unfortunate loss of 30 jobs. Attempts to recapitalise the business fell through, leading to accountancy firm RSM’s involvement as advisors. Although prospects for recovery were explored, the economic environment ultimately stymied these efforts, as confirmed by Damian Webb, a partner at RSM.
Further complicating matters, Ocado’s recent legal triumph over AutoStore in a different but similarly high-stakes context highlights the tumultuous landscape within which Karakuri operated. Meanwhile, the British Business Bank refrained from commenting on specific details, underscoring a focus on fiscal responsibility and taxpayer interest protection.
Karakuri’s founder, Mo Khodadadi, alluded to the technological advancements with enthusiasm, highlighting the robot’s capabilities in object recognition and error alerting. However, these innovations were not enough to shield the company from the challenging economic tides.
The sale of Karakuri reflects the volatile nature of start-up funding amidst economic uncertainties.
