Client Spotlight: Chao Yu, founder and CEO of LoopX

Every startup founder aims to take a technology or product from an idea and build it into something customers want. But going from A to B isn’t always a straight line. The business messaging platform Slack was started as an internal tool at a video game development startup. Shopify founder Tobi Lütke initially set out to launch a snowboarding store but ended up building one of the world’s leading e-commerce platforms.

We’re talking about the pivot. It’s the point when a founder takes a step back to evaluate product market fit and make a change. The change could be to change what product they’re building, like Slack and Shopify, or refocus on a different customer or market.

In the case of LoopX, founder and CEO Chao Yu decided to pivot the artificial intelligence (AI) and robotics company from automating last-mile food deliveries to revolutionizing autonomous transportation in the mining industry.

Pivoting from pepperoni to precious metals

Chao Yu started LoopX while researching and studying for his Ph.D. in mechatronics at the University of Waterloo. His research focused on designing learning-based control systems for autonomous vehicles.

Yu’s experiences ordering food during the COVID-19 lockdowns inspired him to apply the technology to delivery robots. He noticed the extra expenses restaurants incurred using delivery services, and he thought his technology could help automate food delivery and reduce costs for businesses and consumers.

While autonomous robots have been used for delivery before, LoopX’s technology uses a combination of an autonomous driving system and an advanced teleoperation system to navigate challenging terrain or obstacles. The combination also trains the AI model powering the robots to improve its abilities for future deliveries.

Yu partnered with Rogers and conducted a small proof-of-concept pilot of the technology using the telecom company’s 5G testbed at the David Johnston Research + Technology Park. The pilot demonstrated that the technology worked, but it also showed Yu that the market wasn’t right for LoopX.

“I knew we had the right technology, we just needed to figure out the right market fit. Robot delivery didn’t take off for many reasons. First, regulation was a limitation on where we could operate. Second, for consumers, it was a nice to have—not a must have,” Yu says.

Another significant challenge was the profit margin for robot delivery. LoopX’s autonomous robots require specialized sensors and remote operators, limiting their earnings per delivery.

“Once we figured it was not the right market, we explored other problems and markets. Through our partnership with Rogers, we learned they were deploying private 5G networks into mines. Mining presents a dark, dull, dirty, and dangerous environment, making it an ideal application for autonomous technologies,” he says.

The LoopX team invested significant time in learning about the mining industry and its challenges. Yu attended industry conferences and tradeshows to assess the potential for LoopX’s technology.

“We confirmed that there are real problems there we could solve, but we didn’t have a product. We just have the technology, so we spent the last two years building products to solve mine operators' challenges. That is our focus and we believe we are on the right track now,” Yu says.

Going deep on mining

Mining is a critical part of Canada’s economy and economies worldwide. There is a growing demand for rare Earth and other precious metals, which are used in everything from electric vehicle batteries to computer processors used by AI systems.

Yu says the Canadian government sees an opportunity to lead the critical mineral supply chain and has invested considerable funding into the mining sector. At the same time, the mining industry is facing a growing labour shortage due to experienced workers retiring and a lack of interest in the industry in young people.

The growing demand for minerals also means mines must run 24/7, but that pace can lead to potential safety issues. Safety is always a priority for mine operators. But, in the event of a fatal incident, a mine has to be shut down for an investigation, leading to a significant economic impact and jeopardizing the company's reputation.

One of the significant safety risks in mining is near misses of vehicles in the mines. Many mines go one kilometre or deeper into the Earth, and some sections can have poor visibility. LoopX’s first solution for mining is an on-vehicle AI-powered platform that collects data for safety risk mitigation.

“This is an excellent fit for our technology because we have the sensors, cameras, and AI that detect and avoid potential risks. It's not fully autonomous, but it can see what the driver can’t. We collect that data and the mine’s safety management team can use it to reduce safety risks in the future. For today’s mining operations, insightful data are the new gold, and our platform provides exactly that—critical information that enhances safety and efficiency,” he says.

As the mining project digs deeper, Yu says operators will eventually use LoopX-powered autonomous vehicles to navigate inhospitable environments safely. This will lessen the reliance on human operators in challenging environments, enhancing safety and minimizing downtime.

“It’s the core technology we built for the delivery robots. We know how to build that, and now we have a clear roadmap to solve these challenges for mine operators,” he says.

Mining success at the Accelerator Centre

Yu learned about the Accelerator Centre while working with the Rogers 5G testbed in the R+T Park in 2022. LoopX applied and was accepted into the AC:Studio program that year. This May, the startup was chosen as one of 25 companies in the final phase of the AC:Studio program.

“When we joined, we attended workshops and training sessions and learned a great deal. But it was the mentors who helped us see the need to pivot. Those conversations help us reflect on what we were doing and the need to change directions,” Yu says.

He adds that the Accelerator Centre’s network helped connect them with investors who have come on board to fund LoopX’s new product direction. LoopX is set to close its $2 million pre-seed round, which includes a $1 million Federal and provincial grant. But for Yu, the most exciting thing is having paying customers.

“Money from investors will accelerate our growth, but I think the money from clients will prove that our product solves a real problem. That is the best money we can make,” he says.

Visit loopx.ai to learn more about its autonomous innovations for mining.