California-based Skydio became the first U.S. drone maker to be valued at over $ 1 billion in fundraising that shows greater confidence in U.S. second act in war drones with China.
The new valuation comes from a $ 171 million investment led by Andreessen Horowitz’s growth fund, doubling all fundraising since its founding in 2014. Other participants in the round included existing investors Linse Capital, Next47 and IVP, as well as a new investor in UP. The partners.
This is the first major fundraiser since Washington placed China’s DJI, the world’s leading drone company, on the list of entities banning American companies from supplying it with components. The move is widely expected to propel the growth of the U.S. drone industry as products evolve from flying cameras designed for consumers to more sophisticated tools for business and government.
Skydio had been consumer-oriented in its early days, making drones for hobbyists who might want an aerial photo of themselves cycling up a mountain. To avoid trees while maintaining high resolution, she developed obstacle avoidance software that later became critical in her transition to commercial applications – now the fastest growing segment in the industry.
“It turns out that developing all of the software and hardware to do this has set them up to be best-in-class to compete in the enterprise markets,” said David Ulevitch, general partner of Andreessen Horowitz.
Until recently, the Chinese DJI beat its competitors in terms of performance and price. Its estimated market share in the mainstream market is north of 70%, an overwhelming domination that drove GoPro and 3D Robotics out of the mainstream market years ago.
But as drones increasingly use software to create real-time 3D models of infrastructure like bridges and then upload them to the cloud for analysis, US companies led by Skydio, American Robotics, Teal and Draganfly believe they have a second chance in the booming market. .
“The potential of drones has really captured the imaginations of people in the consumer world, capturing incredible video – and in the industrial world for inspection, mapping and surveillance,” said Adam Bry, Managing Director of Skydio.
“But the paradigm is still this manually driven world,” he added. “The real change that is happening in the market is this transition to fully autonomous operations, where the drone lives in a dock, it is connected to the Internet, and it flies itself on demand wherever it is needed.
Skydio’s flagship X2 is equipped with seven cameras, 100x zoom, night vision and promises to turn ordinary users into expert pilots with its self-piloting capabilities.
They are “easy to fly and virtually impossible to crash,” said Benjamin Spain, who heads the North Carolina Department of Transportation’s drone program, which has 11 Skydio planes.
According to September projections from Valuates Reports, a market research study, the global commercial drone industry is expected to grow by a third each year, from $ 6.5 billion last year to $ 35 billion in 2026.
The commercial sector had become the most lucrative market for drones even before Covid-19, but the pandemic has accelerated this growth by highlighting the need for contactless technology.
No matter how great the opportunity, DJI cannot be seen as a competitor. While the group may find it difficult to build the best drones without thermal cameras and chipsets from U.S. companies, they remain on sale at Best Buy and the Apple Store, and anecdotal data suggests they continue to thrive.
In a survey of more than 2,000 business users by DroneDeploy, a leading software group, 78% said they would continue to use DJI. Skydio was far behind at 7%, said Mike Winn, CEO of DroneDeploy.
DJI’s share “is lower than it was before, so it definitely helps US companies, and it’s really exciting for the industry,” he said. “But that doesn’t have the impact some people imagined.”