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00:00After ending its partnership with Uber, Serve Robotics is forging ahead.
00:04The company announced new deals with Grubhub and DoorDash.
00:07As part of the DoorDash deal, Serve's delivery robots will be deployed in Washington and San Jose.
00:13Joining us now is Ali Khashani, Serve Robotics co-founder and CEO.
00:17Wonderful to speak with you this morning.
00:19And this is interesting because when you have this Uber deal, you have about 2,000 robots.
00:25Under 800 of them were deployed in the second quarter.
00:28So if you put Uber aside, you bring in DoorDash, you bring in Grubhub.
00:32How many of these things do you think you can get deployed, especially as you put new cities online?
00:38We've been growing our fleet for the last number of years, 17 quarters of growth in a row.
00:45And I expect that to continue.
00:47So I think the robots are going to reach full utilization in a not-too-distant future.
00:51So as in full fleet are going to be deployed in a not-too-distant future.
00:56So the reason we picked this path of working with DoorDash and Grubhub and we announced that we don't intend
01:02to renew our agreements with Uber when it comes up for renewal next year is that we believe this is
01:08a faster path for growth.
01:10Would you at some point want to bring Uber back on?
01:13Or is this kind of the end, ultimately, of your partnership?
01:17No, listen, we are actually, you know, still delivering for Uber.
01:21This is more about whether the contract would be renewed, which is something we had to share with investors.
01:27Obviously, we wanted to be transparent where we stood at the moment.
01:29But the conversations continue.
01:31I think even if we don't renew, it's always possible we will work together again.
01:37You know, two companies working in the same space is just a, you know, question of what do we see
01:42today and how do we believe things are going to evolve.
01:44And things always change.
01:45So I was just in L.A.
01:47Of course, we don't have your robots in New York City, but certainly they are around L.A.
01:51And a lot of them in L.A., every time I saw one go by, they're so adorable.
01:55So maybe this is kind of messed up of me.
01:57But every time I saw them, I thought, what's stopping someone from just, like, kicking this thing over and trying
02:02to bash open and steal whatever is inside?
02:05How often does that happen with your robots, that people are abusing them, if they will, even though they have
02:11these, like, very adorable kind of little eyes and look like little humans?
02:15Yeah, I mean, look, most people are good.
02:17I think that's something that I've noticed.
02:19I get asked this question a lot more often than these things are a real problem.
02:23For us, it does happen, but the rate at which it happens is really low.
02:28In fact, our robots are more reliable than human couriers.
02:32When they pick up an order, they're more likely to bring it to your door by a pretty wide margin.
02:37And a small percentage of failures is anything from, you know, people interfering with it to technology failure.
02:43But it's very small.
02:44It's like 0.2%, which is a lot less than human courier failure rates.
02:49So this is actually not very common.
02:51What about the speed difference?
02:52Is it getting faster to doors than a human would, or is it just more reliably getting to that door?
02:57So the advantage, obviously, the robots operate on the sidewalk, so they move more slowly than a vehicle on a
03:03road.
03:03But the advantage we have is we don't have to navigate traffic.
03:07We don't have to deal with, you know, parking issues because we are usually in more congested environments where, you
03:13know,
03:14finding parking in front of a restaurant or the customer's house could take time and effort.
03:18We like to joke, you know, it doesn't make any sense to move two-pound burritos in two-ton cars,
03:22especially in environments like, you know, Los Angeles or San Jose that you're now launching,
03:27or Washington, D.C.
03:29These places have a lot of traffic.
03:30I was just thinking, again, as I was walking around,
03:34seeing your robots and some of the other companies on these big L.A. sidewalks.
03:38And L.A. is not a big walking city.
03:41Everybody's driving there.
03:42Could you ever launch in a place like New York where a sidewalk is incredibly crowded?
03:46I can't imagine one of your robots trying to navigate the foot traffic in New York,
03:51like peak rush hour time in midtown when everyone's walking around.
03:55I think so.
03:56Look, sidewalks, there are some streets that have crowded sidewalks.
04:01Then you have the back alley.
04:02You have, you know, you can kind of avoid some of the more busy environments.
04:05But we have been in busy environments like Hollywood Boulevard in Los Angeles.
04:10Lots of tourists, lots of restaurants, lots of food traffic.
04:13We used to actually test our robots in San Francisco when we first started, in Market Street.
04:17So we have a ton of experience in those places.
04:20And this is actually a good opportunity to mention.
04:22We also have robots in hospitals, in hallways that are, you know,
04:26usually packed and very busy and lots of people moving around.
04:29So the technology can actually work.
04:31I think not being in New York is just a matter of getting, you know,
04:34permits and that sort of thing sorted out.
04:36But it's just a matter of time.
04:38Are you actively working on that one?
04:39And I realize that this is a very hyper-specific question to our viewers who are in New York.
04:43But for my own personal benefit, I'm interested.
04:45When might you launch in New York?
04:47Is that something you're actively working on?
04:49Yeah, we've been engaging the policymakers and just trying to kind of test their interest.
04:53We don't want to go anywhere if you're not wanted.
04:55So it really is a question of, you know,
04:58how the cities and policymakers are thinking about these new technologies.
05:03So, you know, we've been engaging with them.
05:05I'm hopeful that that would be solved at some point.
05:08Ali, how expensive is it to make one of these robots and produce it?
05:12Is it, for example, cheaper ultimately than a human courier?
05:16Because I guess you don't necessarily need to pay tip.
05:18But the overall cost of having one of these robotics, is it cheaper?
05:21And does it lead to a world where you maybe do fully replace human couriers at some point?
05:28You know, I don't think we would fully replace human couriers.
05:31But I think a lot of, again, short-distance deliveries, something more than half of deliveries in the U.S.
05:36are less than two and a half miles in distance.
05:38So we can replace a significant majority of those, hopefully.
05:42And, you know, folks would be able to basically work as robot operators, robots, you know, fleet handlers,
05:52that sort of jobs that are much higher leverage.
05:55But at the end of the day, people are going to be part of the process.
05:58And some deliveries are going to be completed by people.
06:01The overall cost is reduced.
06:03Our estimate is in major cities like Los Angeles.
06:07The cost of last mile delivery could be as much as $10 per delivery on kind of average basis, which
06:14is a lot.
06:14But, you know, if you order something from China, it only costs $2 to get it to your door.
06:19But if you order it from Chinatown, it could be $10.
06:21That makes no sense.
06:22These robots can bring that cost down to $1.
06:25And I think if we do that successfully, which I think we are tracking to,
06:29you're going to really see a boom to local commerce and businesses.
06:33There's going to be new ways people are going to use, you know, last mile logistics that they don't do
06:38today because of cost.
06:39So there's going to be a lot of, you know, opportunities, a lot of jobs, a lot more commerce.
06:44So are you expecting this?
06:45Again, you mentioned hospitals.
06:47It's largely in food.
06:48Are you expecting it to get into other areas, too, of last mile logistics?
06:52Yeah.
06:53I mean, last mile is huge.
06:55Obviously, hospital space is a big opportunity.
06:57But the technology we are building is not just to move burritos, you know, on sidewalks.
07:02It enables robots to navigate complex human environments.
07:07That's really what we're building.
07:09Sidewalks and hallways in hospitals are some of the most challenging environments.
07:12So we are starting with the hardest problems.
07:14But the same technology can be applied to many other human environments.
07:19We are not necessarily focusing on the road.
07:21We are not focusing on warehouses where robots have been deployed.
07:24Those are kind of much more simple form of robotics.
07:27But the stuff you're solving is a really hard problem of complex, unpredictable places like sidewalks and hallways.
07:33And being able to bring that technology to basically any robot that can walk around you and be in any
07:39environment that you are and, you know, bring you things, provide services.
07:43What we've always envisioned for maybe decades now is becoming a reality.
07:48Well, I also know that advertising, you note, that generate 50% of your total food delivery revenue in the
07:53second quarter.
07:54You're also creating characters.
07:55You have something called Chomp co-created with Grubhub.
07:59I understand, Ali.
08:00Maybe you can correct me if I'm wrong.
08:01This is something that would actually stop and interact with people.
08:04Wouldn't I be, like, annoyed if I'm waiting for, like, a burrito and it gets to me and it's cold
08:08because it's been, like, shaking hands or, like, talking to some kids on the street or something like that?
08:15Well, you know, it's probably not the robot that brings your burrito that's going to talk to some random person.
08:20But hopefully it will talk to you when it gets to you.
08:23And, you know, we have robots that are maybe on their way to a delivery or maybe waiting for a
08:27delivery.
08:27I think the broader picture is robots are becoming more smart and they can interact and they can actually, honestly,
08:35be a much more fun experience.
08:37Kids love our robots.
08:38And I just can't wait for a moment where, you know, a young kid kind of runs towards the robots
08:43and the robots can actually speak to the kid.
08:45I mean, that would be such a magical experience.
08:47I think we should kind of think about magic as we're building robots.
08:50I have to say, I was passing one of your robots.
08:52I basically had crossed the street in L.A.
08:55And it was waiting to cross the street.
08:57And this little, like, sign went up that said, will you push the crosswalk button for me?
09:01As it's, like, little eyes were blinking.
09:04And I was like, I need to remember that this is not a person.
09:06But I was so taken with it that it was so cute.
09:08Ali, I wonder how much technology is going in this thing.
09:12Like, is it already fully at a point where it's automated that it can communicate with people?
09:16Because I'm guessing it wasn't a coincidence that it walked by while we were at a sidewalk and it asked
09:20me to do that.
09:21And for what it's worth, I did push the button for it.
09:24Thank you for your service.
09:28Look, yes, there's a lot of technology.
09:29I mean, we have the most advanced sensors like, you know, LiDAR that you see on top.
09:34We have NVIDIA chips inside.
09:36We have, you know, a lot of smarts going into this, a lot of this latest and greatest AI models.
09:41And the robots are getting smarter every day.
09:44They can do, you know, most things by themselves.
09:46Of course, this is called level four autonomy, which means when the robot doesn't know what to do, it can
09:51ask humans to help.
09:53So there's someone who can remotely log in and basically help the robots, you know, figure out.
09:57But the robots are getting smarter and smarter every day.
10:00And it's really fun to watch all the kind of technology that goes into this get better.
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