Steel is part of Pittsburgh’s past, but it might also play a big role in its future.
Century-old corporate stalwart US Steel last week launched an investment into and partnership with robotics and artificial intelligence venture studio Carnegie Foundry. The undisclosed amount of funding will support a new focus on finding, scaling and commercializing autonomous and robotics solutions building the future of the steel industry.
Founded in 2019, Carnegie Foundry functions as “a holding company that launches and spins off its own companies,” Chief Strategy Officer Michael Lutzky told Technical.ly. Through a partnership with the National Robotics Engineering Center at Carnegie Mellon University, Carnegie Foundry finds early-stage projects with existing intellectual property and works with its partners to bring those ideas to market by providing a mixture of talent, funding and other business development resources.
And with new partnerships like the one with US Steel, the hope is that this process provides an innovation pipeline for industrial companies looking to use robotics and automation to move into the future of manufacturing. That fills a gap not only in making sure local research has a commercialization pathway, but in the growing lack of in-house research and development departments for large companies like US Steel, Lutzky said.
“Companies find it easier on their books to fund innovation through acquisition instead of [internal] R&D,” he said. But despite that, industrial corporations like US Steel will likely have a harder time finding businesses to acquire for their innovation than software companies, simply because hardware and manufacturing-related needs often take more time and money to develop.
That’s where Carnegie Foundry comes in. Beyond helping larger corporations find new technology to acquire or fund, Carnegie Foundry also provides early financial support to projects in robotics and autonomy that might otherwise have a hard time attracting capital. That’s important, because much of the driving force of Pittsburgh’s tech economy remains in robotics.
There’s a real need for that first financial stepping stone in Pittsburgh, Lutzky said, because the past year of venture capital deals in the city were dismal compared to record-breaking volumes elsewhere in 2021, capturing only about 0.1% of the national total.
“I hope that Carnegie Foundry can be a conduit, a spark for right-sizing that percentage,” he said, “because there is an incredible foundation and pool of concepts, talent, ideas in Pittsburgh that right now, there’s a bit of a mismatch in terms of what capital sees in this space.”
In providing early-stage growth and commercialization tools to those developing groundbreaking technology in this region, Lutzky added that he hopes it will help jumpstart an excitement that could prompt some of the biggest VC firms in the world to open Pittsburgh offices.
Interest from corporations as big as US Steel is particularly exciting in the context of those goals, Lutzky said. For a long-established company with Pittsburgh roots to continually show interest in innovation at a local level means that even industries that might seem set in their ways could actually be ready to evolve once the technology becomes available.
“It’s good to see companies with very strong cash flow and very strong histories starting to take some steps — even if they’re small — into supporting innovation and automation in their industry,” he said.
Though neither party release the terms or amount of the new investment, Carnegie Foundry was reported to have a valuation of $100 million after an investment from Wisconsin-based vehicle and equipment manufacturer Oshkosh in September 2021.
“With this investment in Carnegie Foundry we continue to progress our Best for All strategy to innovate new ways to serve our customers through profitable solutions for people and the planet,” US Steel President and CEO David Burritt said in a press release. “The Carnegie Foundry team are clear leaders and innovators in autonomy and this partnership keeps us at the forefront of emerging innovation in robotics and autonomous solutions for industry. These highly advanced technologies will be essential to continue fulfilling our customers’ needs for a robust and resilient supply chain.”Sophie Burkholder is a 2021-2022 corps member for Report for America, an initiative of The Groundtruth Project that pairs young journalists with local newsrooms. This position is supported by the Heinz Endowments.
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