Leadership1 publisher3 min readPublished
US robotics investors are touring Chinese factories to see what their startups are up against
Dozens of US venture investors have toured China's robot industry in recent months, where two firms shipped 71% of last year's humanoid robots. Their US startups are now measured against Chinese makers that many of them already depend on for parts or assembly.
The Board Room · Leadership desk
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What happened
- Investors from Eclipse, G2 Venture Partners and Chemistry VC have made the trip, as have partners from Founders Fund and Khosla Ventures, The Information reported.
- Some trips are private VC delegations; others are tours at $10,000 a head that package factory visits with translators, five-star hotel stays and dinners with local technology executives.
- According to the Mercator Institute for China Studies, China controls 63% of the key firms in the worldwide supply chain for humanoid-robot parts.
- In July the Federal Communications Commission banned new foreign-made "advanced robotic devices," citing "unacceptable risks" to national security.
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Why it matters
- decision Founders raising money for robotics hardware now have to decide whether to put their costs and output next to Chinese makers in the pitch, because their investors are already making that comparison.
- exposure For US startups built on Chinese parts or assembly, the companies they are benchmarked against are also their supply base, while US rules on foreign-made robots get tighter.
- constraint Investors compare American humanoid makers, most of them still at prototype stage, with Chinese machines already shipping, so the American case rests on production that has not happened yet.
For many of the investors on these trips, the point is to size up the rivals facing their US portfolio companies, not to scout Chinese deals, according to Business Insider [4]. A year ago the idea drew jokes. When Ryan Cunningham of Edgerunner Ventures floated a trip in a WhatsApp group of robotics investors, one person jokingly asked if he could smuggle a humanoid robot home [2]. Nearly every investor group chat he is in now trades notes on recent or upcoming trips, he told the publication [18]. "The reason I want to bring them to China is because I want to take them by the shoulders and say, 'Guys, if you want to get serious, this is what we should be learning from,'" Cunningham said [3].
The skeptical position used to belong to the investors themselves. For years, US investors dismissed Chinese technology as lower quality, said Neel Mehta of G2 Venture Partners [16]. G2 is a Bay Area firm spun out of Kleiner Perkins that backs growth-stage companies in energy, manufacturing and transportation [13]. Mehta and a colleague went to Shenzhen and Beijing earlier this year, building the trip around Morgan Stanley's China Summit and adding visits to Xiaomi and BYD [15]. "We knew they were ahead, but it doesn't really hit you until you're on the ground," he said [14].
The shipment data settles that argument for now. Last year Unitree and AgiBot accounted for 71% of humanoid robots shipped worldwide, research firm Omdia found [6]. Every other maker in the world shared the remaining 29% [1]. Most American humanoids are still in development and cannot be bought off the shelf [8]. A US humanoid startup raising money this quarter is set beside products its investors have now seen in person. "The Chinese have been very hardware focused," Wendy Chang, a senior analyst at the Mercator Institute for China Studies, told Business Insider. "They are trying to own the whole robotics supply chain." [11]
The supply chain is where the trade-off sits. Stanford's 2026 Emerging Technology Review found that most US robotics companies depend on Chinese suppliers for parts or assembly [9]. The industry investors flew out to measure their startups against is, in many cases, the one those startups buy from. That dependence now sits beside the FCC's July ban on new foreign-made robotic devices [10].
The evidence supports half of the case that US hardware startups will be judged against China. The trips are common, and comparison is their stated purpose [18] [4]. The reporting does not show any fund changing valuations, terms or diligence requirements because of what its partners saw. I think the effect this quarter falls on the questions founders get in a pitch meeting. Whether it reaches the price of a round is a question for next quarter's term sheets. China's government has set itself a near date. A 2023 plan compared the potential impact of humanoid robots with that of computers, smartphones and electric vehicles, and set out to deploy them across the economy by 2027 [17].
What to watch
- Whether the FCC extends its July restrictions from finished foreign-made robotic devices to imported components or contract assembly.
- Whether funds returning from China trips, including Cunningham's April group, change valuations or diligence requirements for US hardware startups.
- Whether Unitree and AgiBot hold their 71% share of humanoid shipments as China works toward its 2027 deployment target.