Toronto-based Xaba has secured $6 million USD ($8 million CAD) to improve the capabilities of industrial manufacturing robots with its custom reinforcement learning programming system.
The all-equity, all-primary financing was led by Hitachi Ventures with participation from Hazelview Ventures, the Crown corporation BDC Capital, Exposition Ventures, and Impact Venture Capital. The seed extension, which closed at the end of last year, brings Xaba’s total funds raised to $8 million USD.
Moruzzi refers to the software as giving robots “synthetic brains.”
Xaba sells what it calls an autonomous artificial intelligence (AI) control system that allows humans to interface with industrial robots through low-code, natural language commands.
The startup claims that its programs, xCognition and PLCfy, automatically generate code based on natural-language instructions, allowing them to adapt their functions more quickly. Robots are programmed with the specifications of their hardware and can use this knowledge to complete tasks more effectively.
Current automation models are “extremely inefficient,” Massimiliano Moruzzi, founder and CEO of Xaba, told BetaKit. Most robots sold “out of the box” lack contextual knowledge, such as the physical attributes and functions of their own hardware.
Moruzzi claims its program will feed the robots with information about their own structure and mechanical capabilities. It also has a graphic neural network map to connect industrial specifications and data collected from experience, allowing it to improve capabilities over time.
Moruzzi refers to the software as giving robots “synthetic brains.” Though the deep learning algorithm is a far cry from the human brain, Moruzzi told BetaKit that the program was designed to approximate two key parts of the brain that he says are missing from many industrial robots: self-knowledge and data ontology, which refers to the formal representation of knowledge within a domain that can be shared and interpreted across multiple systems.
The company claims its program is designed to help automate a wide array of manufacturing tasks, including aluminum casting and forging, robotic drilling, robotic welding, and large-scale 3D printing.
Amid a trade war threatening Canadian manufacturing jobs, Moruzzi says Xaba’s technology offers the opportunity to reshore operations by giving more industrial robots improved capabilities, ultimately helping to scale production.
Industrial automation has been slow to catch on in Canada, particularly among smaller enterprises. Just 8.4 percent of manufacturing companies in 2022 had adopted robotics technology, according to Statistics Canada. But companies that did integrate robotics had higher productivity rates, accounting for a larger share of employment and revenue in the economy.
One barrier to automation, the study notes, is difficulty recruiting skilled workers to onboard, program, and manage industrial robots. Xaba aims to fix this problem by making it easier to give robots instructions without advanced coding knowledge.
Rather than replacing labourers, Moruzzi said that Xaba-enabled robots, with their deep learning capabilities, offer the possibility of upskilling human workers. He likened it to how humans play chess or Go against superior computers and get feedback on their performance.
“They can show you new experiences at light speed compared to what a human can actually synthesize in that moment,” Moruzzi said.
In contrast to other Canadian tech companies dealing with uncertainty surrounding tariffs imposed by the United States (US), Xaba said that the trade war has created a “perfect storm” for their business.
RELATED: Shopify, Lightspeed lead Canadian tech stock surge after US pauses universal tariffs
“One of the missions [of Xaba] is to reshore a lot of the manufacturing that Canada has lost,” Moruzzi said. He pitches Xaba’s software as allowing Canada to take control over the automotive and aerospace industries.
For Xaba, it doesn’t matter where his clients are sourcing their hardware, as it’s selling a software integration that can adapt to many specifications. This allows the company to circumvent the impact of tariff uncertainty and variable levies, Moruzzi said.
Xaba has landed clients in Canada and abroad, including US automated manufacturer Fives and Italy-based LEAS SPA.
Moruzzi said Xaba plans to use the financing to expand its footprint, improve its product, and expand its team from its current headcount of 24, which includes AI scientists and engineers. He declined to disclose the company’s valuation, but said its annual recurring revenue is “in the six digits.”
Feature image courtesy Simon Kadula via Unsplash.