Originally published reading on Forbes.com
Three years ago, Customs and Border Protection placed an order for self-flying aircraft that could launch on their own, rendezvous, locate and monitor multiple targets on the ground without any human intervention. In its reasoning for the order, CBP said the level of monitoring required to secure America’s long land borders from the sky was too cumbersome for people alone. To research and build the drones, CBP handed $500,000 to Mitre Corp., a trusted nonprofit Skunk Works that was already furnishing border police with prototype rapid DNA testing and smartwatch hacking technology.
Mitre’s unmanned aerial vehicles didn’t take off. They were “tested but not fielded operationally” as “the gap from simulation to reality turned out to be much larger than the research team originally envisioned,” a CBP spokesperson says.
But the setback didn’t end CBP’s sci-fi dreams. This year, America’s border police will test automated drones from Skydio, the Redwood City, Calif.-based startup that on Monday announced it had raised an additional $170 million in venture funding at a valuation of $1 billion. That brings the total raised for Skydio to $340 million. Investors include blue-chip VC shops like Andreessen Horowitz, AI chipmaker Nvidia and even Kevin Durant, the NBA star. It’s not clear just how fast its drones are selling. Dun & Bradstreet estimates its 2020 revenues were firmly sub-$5 million, a figure Skydio says is “significantly off-base.” What is clear is while the company isn’t pre-revenue, it’s still early days in terms of sales. The Army and Air Force spent $10 million on its drones in the last two years, but much of that revenue came in 2019. By Forbes’ calculation, based on documents obtained through Freedom of Information Act (FOIA) requests and Skydio’s public announcements, more than 20 police agencies across the U.S. now have Skydios as part of their drone fleets, including major cities like Austin and Boston, though many got one for free as part of a company project to help out during the pandemic.
The company was founded in 2014 by ex-MIT and Google unmanned flight specialists with ambitions that go far beyond policing the borders. Gawky, dark-haired and stubble-cheeked, with the manner of a Star Trek ensign, 34-year-old Skydio cofounder and CEO Adam Bry believes his company will lead the world to a place where drones don’t need a pilot, whether they’re helping police, inspecting bridges or delivering goods. “We‘re solving a lot of the core problems that are needed to make drones trustworthy and able to fly themselves,” he says from his home, two blocks from Skydio headquarters just outside of San Francisco. “Autonomy—that core capability of giving a drone the skills of an expert pilot built in, in the software and the hardware—that’s really what we’re all about as a company.”
It claims to be shipping the most advanced AI-powered drone ever built: a quadcopter that costs as little as $1,000, which can latch on to targets and follow them, dodging all sorts of obstacles and capturing everything on high-quality video. Skydio claims that its software can even predict a target’s next move, be that target a pedestrian or a car.
The technology is futuristic, but not exactly brand-new. DJI, which claims yearly revenues above $2 billion, has been making drones with similar autonomous flying features since at least 2016. Some police who’ve used Skydio claim its drones are better at flying in tight, tactical situations—like inside buildings or through a forest—but DJI, which is valued north of $15 billion, has a significant market advantage. Analysts put its U.S. market share at between 70% and 80%, with no other manufacturer above 10% (worldwide numbers are similar).
Skydio’s real advantage might simply be that it is not Chinese. The company bills itself as an all-American alternative to DJI (even if it admits that some of its plastics and metals are made in China). Just before Christmas, the Trump Administration banned American companies exporting to DJI, citing its (and other companies’) alleged work supporting surveillance in China, where oppression of Uyghurs in Xinjiang has caused global outrage. This year’s National Defense Authorization Act may ban any federal agencies buying drones made in China, amidst fears DJI could be forced to send sensitive U.S. government or citizens’ data back to Beijing. Local police agencies are also concerned about the threat of Chinese spying—or at least the optics of buying Chinese surveillance drones.
Skydio is happy to play on such fears, routinely taking potshots at its Chinese competitor. After all, no American technology company has ever been hurt by pandering to persistent Sinophobia.
To remove the pilot from the plane wasn’t always Bry’s dream. Go back 20 years, when he was a precocious kid growing up in Denver, Colorado, his dreams were the exact opposite: to become one of the world’s best remote-controlled plane pilots. He got good, taking part and winning national aerobatic competitions. He saw then what small, remotely piloted aircraft could do. “There’s a really high degree of artistry that goes into this,” he says.
Bry went to MIT, earning a master’s degree in computer science and artificial intelligence, aerospace, aeronautical and astronautical engineering. There he met fellow students and Skydio cofounders Abraham Bachrach and Matt Donahoe. While in college, Bry saw that art could be mastered by a computer. “I was really interested in building something that pushed beyond what the best pilots in the world would be capable of,” he says. In 2012, in a parking lot below MIT labs, they let an albatross-size plane fly itself, dodging pillars and avoiding any collisions in the tight confines of the space. Armed with radar systems used for self-driving cars, a camera, a powerful computer and some autonomy algorithms, it slalomed its way around the space and launched the trio’s entrepreneurial dreams.
After MIT, Bry and Bachrach got jobs at Google and set up Project Wing to work on delivery drones, testing some in Australia. Mainstream, large-scale delivery was a stretch: Drones powerful enough to carry packages are still too heavy, noisy and dangerous to work outside a lab environment. What self-flying drones could do without issue was follow and film users as they climbed mountains or ran through forests. They could help out police and search-and-rescue crews, too. And construction companies, oil businesses or any infrastructure provider could also use them to safely inspect difficult-to-reach structures like bridges or offshore rigs.
Skydio was born in 2014. Four years later, the first consumer drone appeared. Rave reviews followed, and all manner of influencers and film crews snapped them up. The private industry and government work came soon after—and not just in America. Lately, Japan has become a hot spot. “Japan is just an infrastructure paradise,” says Bry. “They’ve got bridges and cell towers and power infrastructure up the wazoo. Our drones are being used there every day for all kinds of interesting inspection tasks.”
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