Investment firms for billionaires hailing from the US, Europe and Asia are driving a wave of deals for robotics AI businesses, defying fears about a bubble in the machine-learning sector.
The venture arm for the family office of France’s richest person, Bernard Arnault, participated in the past few weeks in a Series A fundraising round for Humanoid, a London-based maker of industrial robots. Jeff Bezos’ namesake investment firm boosted its allocation to US robotics software startup Generalist AI. And the family office for Indian tech tycoon Azim Premji is in talks to lead a new funding round for a maker of general-purpose robots based in Paris and Silicon Valley, Bloomberg reported last month, at least its second investment in the sector this year.
The group of investors has a combined net worth of $628.5 billion, with their fortunes all derived from areas outside the artificial intelligence sector, according to the Bloomberg Billionaires Index.
Investing in AI robotics companies “is a discussion we’re often having with clients,” said James Whittaker, Deutsche Bank AG’s London-based head of wealth management for the UK and Nordics regions. “Like with earlier technologies, investors see the potential for them to reshape industries.”
The moves emphasize the long-term horizons of family offices, which typically invest deep pools of capital on behalf of a small group of individuals. That often allows them to look beyond the spending fears that pummeled the share prices of companies in the AI supply chain last month.
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The deal-making activity also signals a growing appetite among private investors for AI companies with products adaptable to the physical world, expanding their allocations beyond makers of large language models and semiconductor chips like OpenAI and Nvidia Corp., respectively.
The market for humanoid robots alone is expected to rise more than 1,000% within the next decade, according to Barclays Plc, and the ultra-wealthy individuals behind family offices often have connections to major operating businesses that can make use of the new technologies.
A UBS Group AG survey of 307 family offices overseeing $1.3 billion on average found that more than three-quarters of their owners had an active operating company, with real estate, consumer goods and financial services ranking as the most common sectors. The same poll also found that AI was the top investment theme for the family offices, and those in the US, Asia and Latin America planned to boost their allocations in the next 12 months.
“Families that control operating businesses can provide data, industry expertise, customer access and real-world deployment environments,” said John Prince, founder of family office platform Respada. They’re “advantages that can be more valuable than another financial investor.”
The number of family offices has boomed over the past two decades amid surging fortunes across tech, finance and healthcare. They’ve pushed into markets for buyouts, second-hand private equity and real estate and even taken activist positions at listed companies. Since they usually serve a single or small group of clients, family offices can generally be nimbler than other institutional investors.
At least a fifth of the world’s 500 richest people now have an investment firm overseeing their wealth, helping manage fortunes totaling more than $5 trillion, according to Bloomberg’s wealth index.
Other members of the world’s ultra-rich betting on AI robotics including the namesake investment firm for US billionaire Dan Friedkin, who allocated to a Series C fundraising round earlier this year for RobCo alongside a money manager for Italy’s Agnelli dynasty. Alpha Square Group, a New York-based family office, invested last month in Uber Technologies Inc. co-founder Travis Kalanick’s industrial robotics company, Atoms. And the namesake family office for Austrian investor Harald McPike backed a Series B financing round in March for Vitestro, a Netherlands-based maker of autonomous systems for drawing blood.
“A next revolution has arrived,” Jensen Huang, chief executive officer of Nvidia, said at a recent event promoting his firm’s own robotics efforts. “Physical AI is here.”
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