Moov, A Marketplace For Used Manufacturing Equipment, Emerges From Stealth With $2.4M From NFX

One of my favorite tracks of all time is “Such Great Heights” by The Postal Service. Released in 2003 on the band’s debut album, Give Up, it’s driven by an excellent IDM-ish bass line, piano accents, Ben Gibbard’s airy yet emphatic vocals, and lyrics ostensibly espousing the “radness” of love. It is, bar none, a great song.

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Its music video is set in the clean room of a semiconductor manufacturing facility. As sterile an environment as you could imagine, it nonetheless depicts a storyline of budding romance via furtive glances shared through visors worn over “bunny suit” coveralls. Interspersed throughout these intimate yet alienated human moments are various machines, working steps along the process of making silicon sand think on our behalf. The video is worth a watch.

As badly as the two would-be lovebirds in the music video need a matchmaker to help seal their fates, so too does the semiconductor manufacturing industry need a brokerage layer to pair companies in need of specialized chip-making equipment with companies with said equipment to spare.

At least that’s the contention of Moov.

Headquartered in San Francisco, today the used equipment marketplace platform launches out of stealth with $2.4 million in seed funding from NFX. Additional participating investors include Tencent cofounder Jason Zeng’s Decent Capital, real estate investor David Adelman’s family office Darco Capital, Great Oaks Venture Capital and other individual investors. Moov says its round was oversubscribed.

In a statement provided to Crunchbase News, the company said it intends to use the funding to hire people here while pursuing an expansion into Asia, the world’s leading region for semiconductor manufacturing.

Moov was founded in January 2018 and has since repurposed over 1 million pounds of surplus manufacturing equipment that would have otherwise remained idle or gone to a landfill.

The company says it’s already profitable and grew its top-line revenue by 300 percent year over year. At the time of writing, Moov’s website says it has 9,977 active listings representing $496.6 million in total equipment value, a still-tiny fraction of the total addressable market the company sees itself growing into over time. A statement from Moov said 400 companies signed up to the platform while the startup was still in stealth.

The Process

As alluded to earlier, the semiconductor production process involves a number of complex manufacturing steps, almost all of which are too precise for human hands to perform. From end-to-end, it’s mostly mechanized. And given the rapid pace of new developments, manufacturing equipment may be used by a high-end producer for only a few years before being made obsolete by the latest and greatest tech.

This doesn’t mean those machines, some of which can cost tens of millions of dollars and have a decade of usable working life at least, are useless. Far from it. They are just no longer the right tool for the job for certain manufacturers. There are plenty of producers around the world who could use the equipment, but can’t or are unwilling to pay MSRP for new machines.

Using software, Moov’s platform helps automate the process of brokering transactions for this used equipment. Company co-founder and chief executive Steven Zhou said that some of its customers are able to acquire the equipment they need for pennies on the dollar when compared to purchasing it new.

And, because these machines are so large and specialized, it can take an equipment manufacturer months to produce one piece of machinery, so the lead times are long. A liquid secondary market lets buyers purchase used equipment and spin up their operations quicker than buying new, the company said.

On a phone call, Zhou told Crunchbase News that the business of connecting supply and demand in this market has been very manual. Zhou and his co-founder have operated in the equipment brokerage business for nearly a decade, and when he got started work hours were spent either staring at spreadsheets or on the phone with prospective buyers negotiating the terms of the transaction and sorting out logistics. He said “there must have been 100 steps” between sourcing and ultimately delivering a piece of equipment to a client.

“We realized there needed to be a scalable solution, an ecosystem that makes this process of bringing offline equipment online more automated. [We saw the opportunity of] using datasets and market information to match supply and demand around the world.” That was the conclusion Zhou and his co-founder came to in late 2017, months before launching a minimum viable version of its platform in 2018.

Its Vision

Apart from the market opportunity, Moov sees itself as eventually playing a key role in reducing the environmental footprint of the manufacturing industry, starting with semiconductors. “Manufacturing contributes about 20% of global carbon emissions, and despite being nearly 100% recyclable, only a small portion of tech waste is recycled. There are trillions of dollars of idle and surplus equipment in the world needing to be brought online through a channel like Moov,” said Zhou in a statement.

Semiconductor manufacturing equipment is a relatively small niche, but the company has a lot of room to grow. Zhou said that expanding into other types of manufacturing equipment is a possibility for Moov, but the company remains focused on building up both sides of this one marketplace for now.

Illustration: Li-Anne Dias