I rode a conveyor belt during Cyber Monday at the Amazon Fulfillment Center on December 2, 2024 in Orlando, Florida.
Miguel J. Rodriguez Carrillo | Getty Images
Amazon It’s about turning to the startup world and finding potential fixes for one of the most troublesome logistics issues.
Retailers of all sizes have struggled to increase unfair returns in recent years. Scams involve shoppers requesting a refund, but instead of returning the item, they hold the item and send back empty packages or boxes of unrelated junk.
According to Appriss Retail, it has become a costly nuisance for retailers, accounting for a loss of $100 billion last year.
Cambridge Terra Hearts, a Sunnyvale, California-based startup, has developed a 3D imaging system that allows you to view inside unopened packages, making it easier and faster for retailers to spot fraud cases.
The company has shut down $12 million in seed funds led by venture company Felicis, with participation from Amazon’s $1 billion Industrial Innovation Fund and other investors.
“As you can imagine, Amazon handles a lot of boxes,” said Nathan Monroe, CEO of Cambridge Terrahearts, in an interview. “It’s a big question of just knowing what’s in the box, knowing how efficiently they’re stuffed, and knowing if what you’re back to them is what you said.”
In 2022, Amazon launched the Industrial Innovation Fund with the goal of investing in companies working on technology solutions that can be applied to the company’s large, complex operational network, from the middle mile to the last mile portion of the delivery process.
Fund head Franziska Bosert said in an interview that Amazon usually plans to pursue a deeper “commercial relationship” with portfolio companies over time, from technological maneuvering to potential acquisitions.
Cambridge technology “aligns well with Amazon’s needs,” and can have a significant impact on your ability to infringe stock and defects after stock is returned or before the package leaves the warehouse.
“The ability to view boxes, identify content and the compact nature of the system can allow for integration at various points of our operations,” Bossart said.
The fund has supported 20 companies so far. Bossart also added that it raised a license agreement with Amazon’s Acquihire last August with artificial intelligence robotics startup Covariant.
Amazon’s investment track record has been scrutinized in the past. A 2020 survey from the Wall Street Journal shows the company’s Alexa fund, which primarily invests in Voice and AI Technologies, launched its own competitive product, citing people and startups who are familiar with the situation. Amazon previously denied fraud.
One of the Alexa Fund’s most notable investments is the video doorbell maker ring, which Amazon acquired in 2018 for $1 billion.
Cambridge connected with Amazon last year through a pitch competition focused on packaging vision. Monroe co-founded the company in 2023 after studying Terra Hearts Imaging at the Massachusetts Institute of Technology.
The company, which has 10 employees, says it has reduced airport-wide security scanners to chip-based systems within pyramid-shaped devices that can fit in your hands. The device was originally devised as a way to detect hidden weapons by looking at independent materials such as clothing and packaging in a modest way.
Cambridge co-founders Nathan Monroe and Anand Dixitt hold custom chips and pyramid-shaped devices that make up the 3D imaging system.
Cambridge Terrahearts
Cambridge said it was approached by companies interested in how technology can be used in supply chains, manufacturing, aerospace and medical applications.
The startup said it is discussing with US customs and border security about how the technology can be used to secure four government contracts and detect fentanyl shipments at the border.
Capital from Amazon and others allows Cambridge to step up employment and “fully commercialize” 3D imaging technology, Monroe said.
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