Chicago, Illinois, has emerged as a crucial node in America’s fast-evolving robotics and automation startup landscape. With deep industrial roots, a robust manufacturing base, and a growing cadre of innovation enablers, the city’s ecosystem offers unique opportunities for investors, founders, and global partners. As U.S. manufacturers face chronic labor shortages and surging demand for automation, Chicago’s startups and infrastructure are poised to lead a new wave of industrial transformation. For international investors and entrepreneurs seeking actionable insight and deal flow, understanding this ecosystem is critical—and Damalion’s expert guidance can be a key differentiator.
This article examines the robotics and automation startup scene in Chicago, focusing on pioneering companies like Formic and Rheaply, the supporting role of mHUB, and the broader investment and innovation trends shaping the city’s future. We’ll also highlight why Chicago’s industrial heritage, talent pool, and emerging capital networks make it a compelling destination for robotics-focused investment. For deeper context on Chicago’s private equity and tech market, see “Chicago private equity news: AI Investments, major exits, and market trends.”
Formic: Pioneering Robots-as-a-Service for U.S. Manufacturing
Founded by Saman Farid and Misa Ilkhechi, Chicago-area company Formic is redefining automation accessibility for small and mid-sized manufacturers across the United States. Their Robots-as-a-Service (RaaS) model allows manufacturers to deploy, maintain, and support robotic systems without upfront capital expenditure, charging only a low hourly rate for actual usage. This innovation addresses a critical bottleneck: according to MIT’s 2025 report, only 10% of U.S. manufacturers have adopted automation, despite projections that 1.9 million to 3.8 million manufacturing jobs could remain unfilled by 2033 due to labor shortages.
Formic’s traction is remarkable. By September 2025, Formic robots had surpassed 400,000 production hours—equivalent to more than eight months of human labor each business day—and are on track for 500,000 by year-end. Their business model, emphasizing high uptime and full lifecycle support, has attracted significant investor confidence:
- Series A (June 2024): $27.4 million led by Blackhorn Ventures, with participation from Mitsubishi HC Capital America, NEC, Translink Orchestrating Future Fund, Alumni Ventures, FJ Labs, Lux Capital, Initialized Capital, and Lorimer Ventures.
- Corporate/venture investment (October 2025): Strategic backing from Humanoid Global, bringing total equity raised to approximately $59 million and more than $100 million in equipment debt funding.
Formic’s growth signals a broader shift in how U.S. industry approaches automation, reducing complexity and risk for manufacturers previously unable to justify the required capital investment. Their model generates recurring revenue and high renewal rates, marking them as a standout for international investors seeking scalable, impact-driven robotics ventures.
Rheaply: Circular Economy Innovation with Chicago Roots
While not strictly a robotics company, Rheaply reflects Chicago’s expanding focus on resource optimization and sustainability. Established in 2015 by Garry Cooper, Peter Tucker, and Tyler Skelton, Rheaply began as a peer-to-peer marketplace for lab equipment, primarily serving academia. The company has since broadened its mission to deliver circular-economy solutions for resource recovery and reuse across organizations.
Rheaply’s platform enables efficient recirculation of valuable assets—lab equipment, office furniture, and more—minimizing waste and optimizing organizational spend. This approach aligns with the growing demand for green-tech and automation-backed resource management, reinforcing Chicago’s reputation as a center for sustainable innovation. Rheaply’s journey also illustrates the city’s ability to nurture startups that blend digital technology with industrial impact.
mHUB and the Rise of Hard-Tech Acceleration in Chicago
A major catalyst for Chicago’s robotics and automation ecosystem is mHUB, the city’s flagship physical-product and hard-tech incubator. In 2023, mHUB relocated to a historic Near West Side manufacturing facility, launching an estimated $50 million innovation and commercialization center. The organization’s $15 million Product Impact Fund I (2020–2023) has been instrumental in supporting early-stage hard-tech ventures, including those in robotics, automation, and industrial IoT.
mHUB’s infrastructure offers startups access to prototyping resources, technical mentorship, and funding opportunities, bridging the gap between concept and commercialization. Notably, Chicago’s Incubator LLC also debuted a $2 million angel fund in 2024, targeting local B2B digital startups, further expanding the city’s capital base for automation-adjacent innovation.
Investment Trends and Opportunities for International Stakeholders
Chicago’s robotics and automation sector is attracting mounting capital inflows, particularly from venture funds focused on construction-tech and AI-driven solutions. According to a Nymbl Ventures report, 55% of Q1 2025’s $3.55 billion in construction-tech funding nationwide went to robotics and AI-enabled technology, underscoring the growing appetite for automation solutions across supply chain and industrial verticals.
The city’s industrial DNA—combined with talent from leading universities, a supportive investment community, and anchor organizations like mHUB—creates fertile ground for robotics startups. Chicago’s transition to a next-generation innovation hub is further reinforced by its position as a logistics and manufacturing powerhouse, uniquely positioning it for growth in warehouse automation, industrial robotics, autonomous vehicles, and drone tech.
For international investors, family offices, and entrepreneurs, Chicago offers:
- Access to a diverse, scalable automation customer base across manufacturing, logistics, healthcare, and research sectors.
- Robust IP protection and regulatory support for industrial technologies.
- Accelerated commercialization via mHUB and other ecosystem enablers.
For broader context on global investment flows and cross-border structuring, see “Chinese private equity funds choose Luxembourg to invest in Europe.”
Damalion supports international startups (from pre-seed, seed, series, A, B, C, growth stage and mid-caps) entering the U.S. market with corporate structuring, fundraise, customer development expertise, regulatory compliance, and operational guidance tailored to the needs of growing companies. We also advise international investors, family offices navigating the U.S. startup ecosystem and real estates with deal sourcing and strategic advisory.
