Sex Tech and the Rise of AI Robotics in the Bedroom: 9 Investment Ideas

MF Williams
July 19, 2021
Reality blurred

The ‘sex tech’ industry is combining the huge advances in Artificial Intelligence (AI) and Robotics technologies to produce new and novel ways to experience sexual pleasure.

The porn industry has a history as a technological disruptor. Take for example the widespread adoption of the internet, streaming videos or even the payment gateways to process online payments that the e-commerce industry relies on today.

Sex tech appears to be the next step in that list of disruptions. What was once considered science fiction has now become reality, and your bedroom may never be the same again as a result.

The sex tech industry is 10 years old, and was deemed to be worth an estimated $30 billion in 2019. Growth estimates see that valuation almost doubling by 2026.[1]

Savvy investors should take note and read on to learn more about this interesting investment opportunity.

Novel Convergence of Technologies

Steve Jobs presenting the new iPhone

What we are seeing happen in the sex tech industry is akin to what happened back in 2007 when the first iPhone was released.

Technologies from various fields had reached a high level of sophistication in their own right.

It took Steve Jobs’ vision to put those divergent tech applications together and create something that would literally change the world on arrival.

And we all know what happened to Apple stock as a result. At the time of the first iPhone launch in 2007, Apple (NASDAQ: AAPL) stock was trading for as little as $4/share. Today Apple trades around $140/share.

Sex tech companies are doing something similar. They are taking the mind-blowing advances in AI and harnessing speech recognition, machine learning and basic cognitive skills like remembering names and important dates and merging that with current robotic technologies such as touch sensors, articulated joints and micro-motors.

The results are, to be honest, alarming — peaking both curiosity and sexual arousal.

I have to say that I found myself getting a little disconcerted while doing research for this article. Some of the sex tech dolls are so realistic, I found myself confused as to what was real and what was a sex robot.

They are that convincing.

The concept and social norms of sex are being turned upside down. I believe that as the sex tech space matures and introduces further advances by adding specific features enhancing the user experience, sales are sure to grow exponentially.

Next Level Sexual Pleasures

Sex tech includes a wide range of products that include hyper-realistic sex robots; app-connected smart vibrators, stimulators and massagers that learn and remember your preferred movements and tastes; personalized porn; virtual reality sex; and augmented sexual enhancement to heighten the users experience.

Smart Sex Toys

The Popular Lioness Smart Vibrator and App. Source: lioness.io

Artificial intelligence in sex toys aims to learn from data gathered by sensors to elevate and improve the experience as well as personalize it.

Most of these toys are connected to smartphone apps and let users learn more about their sexual preferences.

Female sex toys is one of the fastest growing segments in sex tech. Single women are among the leading contributors to the market.[2]

And unsurprisingly, many of these companies are owned by women.

Virtual Reality Sex

Virtual reality (VR) has come a long way in its development and now can deliver very lifelike experiences complete with haptic touch sensations. VR can be taken a step further with external sex tech devices connected to the app, creating a recipe for a mind-blowing experience for users.

Sexual content related VR puts the viewer in the middle of the action. If done right, the experience can seem lifelike, making you feel like you are actually there as an interactive participant — and not just an observer.

Sex Robots

Probably one of the biggest beneficiaries to emerge from the advancement of AI (Artificial Intelligence) tied to robotics could be the sex and companion robot directed at both men and women worldwide.

The results are hyper-realistic models that breathe, have orgasms and a heartbeat. Thanks to advanced AI, these sex robots can hold a conversation about movies, music or books. They can tell jokes, remember your brother’s name and, of course, will have sex with you whenever you want.

The HarmonyX by RealDoll. Source: realdoll.com

Arguably one of the most lifelike dolls being developed, the HarmonyX by RealDoll, a leader in sex robot development, is fully customizable — from her hair down to her private parts.

Watch the video on YouTube to get an idea of how far the technology has come: https://www.youtube.com/watch?v=cNiPmdsLpP4

Demand for sex robots already appears to be strong. In the UK alone, more than 40% of men surveyed stated that they could imagine buying a sex robot for themselves in the next five years.[3]

And it isn’t just men who will be interested: RealDolls claims that 5% of their customers are women, while the remaining 95% are men.[4]

Driving Forces in Growth

The sex tech industry is sitting on top of rocket growth due to the following reasons:

  • First and foremost, it is the basic human drive to have sex. It is a powerful motivator, and the sex tech industry is aiming straight for our loins. As the sex tech toys continue to improve and become more ‘real,’ more and more consumers will have a hard time saying no.
  • The sex tech industry has benefited from the huge advances in AI and robotic technologies. This trend will continue to make sex tech toys even more convincing and life like.
  • Another driving force of market growth is the widespread acceptance of sex toys. Social media and movies have brought sex toys out of the closet, so to speak, with messaging that these are not bad or taboo. Moreover, both mediums have significantly influenced millennials and future generations in accepting sex toys as a healthy means of enhancing their sexual life.
  • The ongoing COVID pandemic and social distancing requirements make ‘hooking up’ almost impossible, if not downright dangerous. Who needs to venture outside and risk contracting COVID (or a sexually transmitted disease for that matter) when they can enjoy a session with their favorite smart vibrator or sex robot?

9 Ways to Invest and Profit in the Sex Tech Industry

While many of the companies actually making sex tech products are still private and relatively small, some do offer direct opportunities for private placement.

You will need to do your own research and reach out to these companies about what investment opportunities they offer.

3 Privately Held Companies That Show Promise

Realdoll/RealBotix – Abyss Creations, owner of Realdoll and RealBotix, is the current industry leader when it comes to high-end sex dolls and robots.

Henry is available as a straight or gay companion sex robot. Source: realdoll.com

The company also develops robotic technologies capable of automating processes from households to industries. In addition, they are working on their proprietary artificial intelligence engine.

Abyss also provides software solutions compatible with major devices and systems on the market.  

Prices for RealDolls start at $6,000 and can go as high as $50,000 depending on the customizations chosen.

Silicon Wives Lara Fit Sex Doll. Source: siliconwives.com

Silicon Wives – A mid-range sex doll company, the company is focused on the future with a promising young brand. The company has a team of professional artists with over 10 years in the sex accessories business.

With dolls selling for $2–$3,000, sales in 2020 were up 25% over 2019 according to the company.[5]

SexDollGenie - Another mid-range supplier, this Miami-based company saw a 33% increase in sales by couples during the peak of the pandemic, proving these dolls aren't just for singles.[6]


More Private Companies Worth a Look

I found a good list of private sex robot manufacturers which might help in your further investment research: https://futureofsex.net/robots/state-of-the-sexbot-market-the-worlds-best-sex-robot-and-ai-love-doll-companies/

 

6 Publicly Traded Investment Opportunities

While the companies below are not directly active in the sex tech industry, they are active in developing the technology that goes into sex robots and toys.

I believe that as the sex tech industry gains further social acceptance, we will see these mainstream AI and robotics companies begin to develop their own products or at least license their tech.

Global X Robotics & Artificial Intelligence ETF (NASDAQ: BOTZ)

For investors looking for momentum, the Global X Robotics & Artificial Intelligence ETF BOTZ is a good pick. The fund share price is up almost 100% from a year ago.

The ETF invests in companies that stand to benefit from the increased adoption of robotics and AI. This includes both industrial and non-industrial robotics and automation as well as autonomous vehicles.

Robotics companies continue to see increased opportunities due to the COVID pandemic replacing jobs that humans once performed. It is generally accepted that robotics will continue to see increased usage in a wide range of capacities across various industries.

A good place to start your research — look at what stocks are held by the fund and pick and choose which look best for your portfolio.

Ekso Bionics Holdings, Inc. (NASDAQ: EKSO)

Ekso Bionics® is a pioneer in the field of robotics. For over a decade, they have been committed to developing the latest technology and engineering to commercialize wearable exoskeletons and robotic-assist devices in a variety of applications such as medical and industrial markets.

Exoskeletons resolve unique customer challenges in rehabilitation, allowing people to rethink their current physical limitations. Lightweight assist devices for industrial workers will help achieve mobility, strength, or endurance not otherwise possible.

Ford Motor Company (NYSE: F) partnered with Ekso Bionics to pilot EksoVest which led to the next generation of exoskeleton technology, the EVO, in multiple US plants. Since then, Ford has observed an 83% decline in worker injuries.

Cognex Corporation (NASDAQ: CGNX)

The company provides machine vision products that capture and analyze visual information in order to automate manufacturing and distribution tasks worldwide. The company also provides a range of inspection tasks, including part location, identification and robotic guidance.

Cognex Deep Learning is the first set of field-tested, optimized, and proven inspection technology based on state-of-the-art machine learning algorithms. Combining artificial intelligence (AI) with In-Sight or VisionPro software, it automates and scales complex and challenging inspection applications.

Investors should look at the stock as a long-term hold.

ABB Ltd (NYSE: ABB)

ABB Ltd boasts 21 divisions in the company. However, readers of this article will find the Robotics & Discrete Automation division most interesting.

The business provides value-added solutions in robotics, machine and factory automation. The company’s focus on innovation includes extensive work in artificial intelligence, an ecosystem of digital partnerships, and the expansion of production and research capabilities through a $150-million investment in a new world-class robotics factory in Shanghai.

Last year, the company announced a partnership with Covariant that brings together the two companies with a shared vision for robotics enabled by AI. Intelligent robots work alongside humans in dynamic environments, collectively learning and improving with every task completed.[7]

YASKAWA Electric Corporation (OTC US: YASKY)

The company released its first all-electric industrial robot “MOTOMAN” in Japan in 1977.

Since that time, they have commercialized and marketed optimum robots for various uses, centering on arc welding, handling, assembly, painting, transfer of liquid crystal panels, and transfer of semiconductor wafers.

Recently, the company has been working in developing robots for the food, pharmaceutical, cosmetic, and biomedical markets. The company was founded in 1915 and is based in Japan.

Alphabet Inc. (NASDAQ: GOOG)

Alphabet is a major player in R&D of AI, machine learning and robotics.

The company is hyper-focused on meshing machine learning with robotic systems technologies. The two teams work closely together on real and simulated robotic systems.

Part of the company’s research involves teaching robots how to predict what happens when objects are moved around to make safer decisions without supervision. The company is sharing this data publicly to help advance the technology.

The company is also working on melding advances in deep learning technologies with robot motion planning and navigation. Self-driving cars will be a big recipient of this R&D with the goal of improving safety and reliability.[8]

I believe that Alphabet, with its strong position in AI and robotics, could very well unleash their own sex robot to the masses in the near future.

The Rise of Sex Tech

Sex tech promises to transform the very definition of what sex is and its place in society. As a result, our sex lives may never be the same.

While this industry is at its early stages and becoming red hot, it should ultimately continue to gain traction as AI and robotic technologies improve. I believe consumers will be lined up around the corner as sex tech becomes more advanced, mainstream, and socially acceptable.

Early novel thinking investors could potentially see a see a nice bump in their portfolios. Investors just need to keep an open mind to alternative investments.

The Sex, AI, Robotics sector(s) is currently in its infancy, and it is imperative for investors to do their due diligence. Mind you, there are plenty of hidden gems among the alternative investment world that are waiting for you and the rewards could be huge. I'm a big advocate of having an open mind when it comes to investing in up-and-coming industries and sectors.

With the right research and planning, the financial rewards could be huge.

MF Williams, Contributor
for Investors News Service

P.S. To discover more opportunities in the hottest sectors in North America, sign up now to the Financial News Now newsletter to get the latest updates and investment ideas directly in your inbox!

DISCLAIMER: Investing in any securities is highly speculative. Please be sure to always do your own due diligence before making any investment decisions. Read our full disclaimer here.

Published July 2021



Sources:

[1] https://spectrum.ieee.org/telecom/wireless/design-and-optimization-of-fbar-filters-to-enable-5g

[2] https://www.prnewswire.com/news-releases/global-52-7bn-sex-toys-market-outlook-2026---rising-presence-of-online-retailers-drives-the-industry-300973202.html

[3] https://www.businessleader.co.uk/sex-robots-a-disturbing-look-inside-one-of-the-worlds-fastest-growing-industries/53749/

[4] https://www.forbes.com/sites/reenitadas/2017/07/17/goodbye-loneliness-hello-sexbots-how-can-robots-transform-human-sex/?sh=44efca1176e3

[5] https://nypost.com/2020/12/12/sex-doll-sales-rising-amid-covid-19-holiday-season/

[6] https://www.forbes.com/sites/willyakowicz/2021/12/31/forbes-favorites-2020-the-years-best-vices-stories/?sh=369d00372d81

[7] https://new.abb.com/news/detail/57457/abb-and-covariant-partner-to-deploy-integrated-ai-robotic-solutions

[8] https://research.google/teams/brain/robotics/

MF Williams
MF Williams came to FNN with an already impressive career analyzing small and microcap companies. He became involved in banking and finance working for BNP Paribas North America in New York City in early 2000. He soon found his true passion in small and microcap sector stocks, with their dramatic potential for upside growth. With over 20 years of experience analyzing and researching emerging small cap public companies, his insight and skill set are unmatched.
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