If braving traffic to the Chick-fil-A on Kirby Drive along the Southwest Freeway doesn’t sound appealing, a new startup has another way to get you your fix.
San Francisco-based Faction, an autonomous vehicle delivery service, is rolling into Houston through a series of pilots, including one with the fried chicken chain. For now, the company only has a few three-wheeled delivery vehicles operating, but Faction hopes to scale that number up to over 50, said founder and CEO Ain McKendrick.
Faction’s growth comes as self-driving technology is taking to Houston streets through the efforts of companies such as Cruise LLC, Kodiak Robotics and Aurora Innovation Inc. (Nasdaq: AUR). McKendrick pointed to a favorable policy environment in Texas, where companies only have to deal with state regulations, and a wide variety of customers in Houston.
“We're not afraid of regulation because regulation sets the ground rules for how you operate properly,” McKendrick told the Houston Business Journal in an interview. “Being regulated at the state level avoids some of the challenges you've seen with some of the smaller robotic systems like sidewalk robots or bike-lane robots because the sidewalks and the bike lanes are regulated typically at the local level. And so, you have to go build relationships with every single municipality that you're trying to operate in.”
A Texas bill passed in 2017 prevents municipalities from regulating autonomous vehicles on their roads, though the city of Houston told the HBJ that individual companies may brief first responders on their plans. Meanwhile, local unions have expressed concerns about self-driving technology operating on the same streets and doing the same jobs as workers.
According to a route map that McKendrick provided to the Houston Business Journal, Faction is currently operating in an area northeast of Bellaire, including West University Place.
Each three-wheeled vehicle can carry 500 pounds of deliveries at maximum capacity. They are classified as motorcycles, which McKendrick said also lessens the regulatory burden on the company and lessens the street footprint compared to a full-sized delivery car or truck.
The vehicles do most of the driving and are programmed to stop if they detect something unseen in their pathway, using a combination of cameras, thermal sensors and radar. McKendrick said human operators monitor the vehicles and can adjust their behaviors depending on the context of what they encounter. While the vehicles can be operated from the San Francisco Bay Area, Faction will have Houston-based operators as well.
“One operator might be able to supervise up to five vehicles in an operating area, but don't think of them as looking at five screens simultaneously. It's more like air traffic control and air traffic," McKendrick said.
Faction is not McKendrick’s first venture into self-driving technology. He previously worked at Starsky Robotics, a company designing an autonomous semitruck. Starsky, along with Google’s Waymo robotaxi business, were responsible for the growth of autonomous vehicles in California. However, Starsky went bankrupt in 2020 after failing to secure funding.
McKendrick acknowledged that certain “generation one” self-driving companies had put the cart before the horse when it came to funding and tried to rely on artificial intelligence as a technology solution. However, he felt Faction’s pathway to success was based on proven technology rather than fast capital. He also highlighted the higher margins present in logistics and micro-logistics — or food delivery — compared to applications such as robotaxis.
“Many of those early companies went down the route of building a 100% AI-enabled solution," McKendrick said. "Many of them have now accepted that remote [human] assistance is an integral part of scaling, and Faction embraced that from the beginning.
"So when we built the Faction vehicles, we specifically designed these to be a product. We said it has to be a light electric vehicle; it has to be cost effective. This is not a research project. This is something that has to be on the right side of the economics but also, most importantly, has to fit the power budget of a light electric vehicle system."
For now, McKendrick said Faction is looking at larger franchises as the company’s initial customers, due to the high volume of repeated trips that restaurant and grocery chains require. But smaller businesses are encouraged to circle back in a year, he said.
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