Robotics company settles Tesla trade secret suit and announces $11M raise

Jay Li doesn’t recommend getting sued by Tesla if you’re trying to start over. But he thinks his company, Proception, would be better off enduring the experience.

“I think it’s like a stress test, or a stress test,” he told TechCrunch in an exclusive interview. “People say what doesn’t kill you makes you stronger, right?”

Li, who was the technical lead on Tesla’s Optimus humanoid robot system, was accused by his former employer last year of evading trade secrets to start Proception. But after months of trading legal blows, he finally reached a settlement with Tesla, which dismissed the lawsuit earlier this month. (Tesla did not respond to a request for comment.)

Now Li is free to tackle what he thinks is the most difficult problem: making robotic hands work like humans.

To help do that, Proception announced Monday that it has raised an 11 million seed round led by First Round Capital, with contributions from Y Combinator and early stage fund BoxGroup.

Proception also announced Monday that it is shipping the first batch of its “advanced robotic” hand to “researchers and robotics companies,” while opening up for general orders. The goal, Li said, is to become a top supplier to other companies that don’t want to spend time or resources developing what’s known in the industry as “insidious fraud.”

Although there has been a lot of money and attention rushing into the world of robotics, Li believes that not enough has been done to make robot hands truly mimic human hands.

One of the loudest voices talking about this challenge has actually been his old boss, Tesla CEO Elon Musk, who said robotic hands are one of the biggest engineering problems yet to be solved.

Although Musk has insisted that Optimus robots could start working in factories within years, the consensus view is that making robot hands the size of a human is still years away. Kevin Lynch, director of Northwestern University’s Center for Robotics and Biosystems, told the Wall Street Journal last year that his group believes it will take a decade until they are “functional and useful and able to do some of the things that humans do.”

Li thinks Proception can do it much faster, in large part because of how it collects data.

Most humanoid robot training companies currently use teleoperators to train their systems. A person wearing a virtual reality headset is able to see what the robot sees and control what is in front of that robot, where the robot cannot learn from commands given by a human.

The main drawback of this method, according to Li, is that the teleoperator does not receive feedback from the objects the robot touches. This approach is also limited to the number of robots a company has at any given time, Li said.

Proception’s solution is a glove full of sensors. With human testers wearing gloves (and a headset), Proception and its customers can capture “human hand interaction data without requiring a robot in the loop,” according to a Proception report.

This same glove also continues the hand Proception develops, acting as a “skin” full of senses. The hand has 22 degrees of freedom and multiple joints per finger to allow for a “wide range of motion,” according to Proception.

Li said the approach would also allow Proception and its customers to collect specific, task-specific data that would allow its robotic hands to more accurately resemble human hands. He also thinks that it is better suited for promotion.

“You need both hardware and data, and those need to come together to get you [dextrous manipulation] to work. Many companies focus on hardware only, or as hardware and data immeasurable [collection],” he said. We believe that is an important combination to solve this problem.”

First Round Partner Bill Trenchard, who led the investment in Proception, said this was a big reason why he backed Li.

“We think they’re going to have the best hand on the market, probably the most sophisticated hand today, and the underlying data and models to support that,” he told TechCrunch. “Intelligent manipulation is a very important, very important part of the humanoid story going forward, and as many people have said, it’s kind of the last mile to make these robots work realistically.”

Trenchard also praised Li’s ability to keep his cool while being sued by his former employer.

“He was so far ahead of us when this came out, and I think the team did an amazing job of keeping their heads down,” Trenchard said. “Jay is a very strong leader.”

Li is also confident. After facing Tesla’s “strong litigation department,” he told TechCrunch that he wouldn’t be surprised if the company came calling for help as Proception grows.

“I think it will happen,” he said.