SAN FRANCISCO—Standard Cognition Corp., a Bay-area startup offering Amazon Go-like checkout technology, has raised money from investors at a $1 billion valuation, according to Bloomberg.
The company sells cameras and software that can track browsing shoppers and automatically charge them for their purchases when they exit the store. As NACS Daily reported in August, Circle K is installing Standard’s technology in an Arizona store. Circle K officials say they are committed to adding the equipment to 40 more locations. (See the system in action in this YouTube video.)
“We are really on the precipice of unleashing this on the world,” said Jordan Fisher, co-founder and CEO, Standard Cognition, who believes the pandemic has accelerated interest in cashierless technology.
“Retailers find themselves in the midst of a perfect storm, as they struggle for razor-thin margins, battle the likes of Amazon and Walmart, and are beaten down by COVID-19,” said Fisher in a press release yesterday announcing a new $150 million round of funding. “As stores across the world shut their doors, retailers and their customers have waited for a technology like computer vision to help drive the industry forward. This new category will be bigger than mobile or the Internet. It is the most disruptive thing to happen to retail in decades.”
The startup has its roots in a discussion group Fisher formed while working at the U.S. Securities and Exchange Commission in New York. The group met weekly to discuss cutting-edge technology they could pursue as entrepreneurs. By late 2016, they had settled on computer vision, which helps machines understand images. He decided to apply it to the retail checkout process, but just days later, Amazon announced its first Go store in Seattle.
“Most of the team was like, ‘Oh, no. I guess it’s back to the drawing board,’” said Michael Suswal, COO of Standard and one of seven co-founders.
But the team decided plenty of retailers were looking for automated checkout technology and were wary of working with Amazon. “There's the elephant in the room; you don’t want to partner with your biggest competitor,” Fisher said.
Standard opened a test store in San Francisco in 2018, inviting shoppers and paid contractors to try to outwit the technology. Standard deliberately chose a simpler approach than Amazon—relying solely on cameras and not shelf sensors. Standard said its AI-powered computer vision system doesn’t use facial recognition and lets shoppers remain anonymous. The company wanted retailers to be able to install the technology without costly retrofits.
Getting the systems installed and running smoothly has gone slower than expected, but Standard expects to have the system in at least 100 stores by the end of this year. Compass, a retailer that operates thousands of locations including canteens at Google headquarters, has installed Standard’s technology in three locations so far, including a convenience store at the University of Houston. Compass is also testing Amazon Go’s “Just Walk Out” technology.
Scott Wu, chief technology officer of Compass’ retail research and development unit, believes in automated checkout but says it will take time for the technology to become commonplace. “The cost is still really high, because it’s new and not at scale yet,” he said. “When the technology is mature, and the price is at a point where its scalable, it will be everywhere.”
Standard charges customers an upfront fee to cover the cost of the cameras and backroom computers, as well as a monthly fee, but did not disclose exactly how much a retailer would pay for the service.
The August 2020 cover story of NACS Magazine explores “The ‘Vision’ of Future Checkout,” including its applications for c-stores.