, a San Francisco-based startup developing an operating system for drones, announced it had raised $30 million in venture capital in a round led by Next World Capital. That investment also included previous investors like Kleiner Perkins Caufield & Byers and Andreessen Horowitz as well as Executive Chairman and former CEO John Chambers, who joined Airware’s board.
Founded in 2011 as Unmanned Innovation Inc., Airware is now one of the highest funded drone startups, having raised more than $70 million to date. Airware CEO Jonathan Downey declined to disclose his company’s valuation, but VC Experts, a private company intelligence firm, estimated that it could be valued at as high as $190 million following this round.
While most of the attention in the nascent drone space has been focused on consumer drone manufacturers like China’s SZ DJI Technology Co. or Berkeley, Calif.-based 3D Robotics, Airware has remained solely focused on enterprise applications. Its technology centers around the “Aerial Information Platform,” a hardware and software solution that lets commercial operators tailor drones for uses like surveying agriculture or inspecting construction sites.
“We’ve been working for the last four to five years now on building out technology for commercial use cases,” said Downey. ”Some other companies in the space may have viewed the consumer market as a stepping stone to build out their technology. I’ve been pretty skeptical of that approach.”
Those statements come in light of recent problems at 3D Robotics, which went through a round of layoffs earlier this month after the failure of its flagship consumer drone, the Solo. With poor sales, the company is looking to refocus on enterprise applications CEO Chris Anderson told Xconomy. Some reports estimated that the company has laid off more than half of its staff, which at one point totalled more than 300 people.
Airware has undergone some shifts of its own and Downey said that the company was changing its business approach. Previously, the company worked with commercial drone manufacturers to integrate its autopilot hardware and software into devices, which would then be sold to businesses. Now, Airware will be interacting directly with enterprise clients, communicating with those corporations to determine what the best drone would be for a given application.
Downey said that company was already working with the likes of General Electric GE +1.11%, which invested in the startup through its venture arm, as well as State Farm , Airware’s first insurance customer. In its recent aerospace forecast, the FAA ranked insurance as the fourth largest potential market for drones behind industrial inspection, aerial photography and agriculture.
Downey said he was initially surprised by the eagerness from insurance companies to adopt drone technology and called the industry “highly competitive.” Many insurance firms have already attained exemptions from the FAA’s blanket ban on the use of drones for commercial purposes and Downey noted the Airware was already collaborating with State Farm to trial UAV-aided roof top inspections on homes in the southern U.S.
Some of Airware’s new enterprise relationships may also come through Chambers, who served as Cisco’s CEO from 1995 to July 2015. Initially introduced to Downey as a mentor by Marc Andreessen, Chambers has coached the young Airware CEO and help initiate contacts with potential clients. The former Cisco chief said he has not sat on a board other than Cisco’s since leaving as a director from Wal-Mart in 2006.
“The first thing I did when I got interested was call up CIOs that I know very well and ask, ‘Do you see this as being important in the future?’” said Chambers, a trained helicopter pilot who only recently started flying drones on Downey’s advice. He said his personal investment in Airware was his largest in a startup to date and added that he would help Downey in recruiting, customer relationships and building out a sales team.
Much of that $30 million in funding will go toward building out customer and sales support, said Downey, who also mentioned that the company would look to expand into Europe, an expertise provided by Next World Capital. And with commercial drone standards set to be revealed by the FAA later this year, Airware’s CEO said the company will be well-positioned to take advantage of inbound interest once more businesses start to consider the possibility of employing fleets of UAVs.
Source: Forbes