3 Drone Delivery Startups Using Flying Drones
Drone delivery is one application of drones that’s already happening in niche applications, but it remains to be seen if drones buzzing around dropping off packages will become as ubiquitous as smartphones are these days. Right now the consumer drone exists because of improvements in materials, compact video cameras, and better performing lithium batteries. We can only assume that over time these improvements will move along a Moore’s Law type of path where soon a compact drone will be able to lift 100 pounds and fly for hours on a single battery charge. If we can get the legislative hurdles out of the way, there is no reason to think that drone delivery won’t be a commonplace fixture in our society.
In a previous article, we took a look at a few startups that are trying to develop ground delivery drones. Now, let’s take a look at 3 startups working on using drones to deliver things by air.
Founded in 2011, San Francisco startup Zipline has taken in a total of $43 million in funding so far from some big names like Google Ventures, Sequoia Capital, Jerry Yang (co-founder of Yahoo), and Paul Allen (co-founder Microsoft). Zipline closed a $25 million Series B funding round just 5 days ago to continue development of their health supply delivery drone that behaves more like a commercial airplane than the helicopter type drones we’re accustomed to. The business model for the moment solely focuses on delivering critical medical supplies to remote areas by dropping small packages with parachutes as seen below:
The healthcare professional sends a text, the drone takes off and flies a pre-planned route at 60 miles an hour, and then drops the designated package at a pre-programmed destination. Through a partnership with the Government of Rwanda, Zipline will soon be making upwards of 150 flights a day in Rwanda delivering blood to 21 different hospitals throughout the country. Zipline has also set their sights on the U.S. with the below excerpt taken from a fact sheet released by the White House called “New Commitments to Accelerate the Safe Integration of Unmanned Aircraft Systems“:
Using unmanned aircraft to deliver critical medical supplies to improve health access in hard-to-reach areas: Zipline International, with the support of Ellumen, ASD Healthcare, and the nonprofit Bloodworks Northwest, will demonstrate the viability of unmanned aircraft technology in disseminating critical care supplies to remote communities in the United States.
Let’s hope that with a new fearless leader at the helm, saving lives in hard-to-reach areas of the United States is going to become a beautiful, beautiful thing.
Update 05/17/19: Zipline has raised 190 million at a $1.2 billion post-money valuation to set up delivery hubs at 2,600 health facilities in Rwanda and Ghana by the end of this year. And it will soon be making deliveries of medical supplies in the U.S., starting in North Carolina, where it has secured permission from the FAA to do so. This brings the company’s total funding to $221.6 million to date.
Founded in 2013, Nevada drone startup Flirtey has taken in $3.9 million to develop their delivery drone which we discussed before when they created a lot of hype around a single slurpee delivery with 7-11. Flirtey seems to be focused on partnering with food and drink companies as they announced in August of this year that they’re now working with Domino’s Pizza to deliver pizzas in New Zealand using drones like the one seen below:
With an initial delivery radius of about a mile, the offering will expand to a radius of 6.2 miles following appropriate regulatory approvals. In August of this year, Dominoes Pizza put out a press release stating that “it doesn’t make sense to deliver a 2 kilo pizza in a 2 ton vehicle” and announced their plans to expand drone delivery trials in six other markets – Australia, Belgium, France, The Netherlands, Japan, and Germany. As it turns out, Dominoes is all over drone technology and has already put together the Dominoes Robotics Unit (DRU) which has developed the ground-based pizza delivery drone seen below:
Now if we can just get the Domino’s pizza makers to be replaced by pizza making robots like the ones over at Zume, the entire operation might soon be run by robots. Now before you go feeling sorry for all the pizza delivery drivers who will be out of a job, just remember that delivering pizza is one of the most dangerous jobs in America. We’re starting to see a trend here with drones saving lives which brings us to our next drone delivery startup.
Founded in 2011, Silicon Valley drone delivery startup Matternet has taken in $13 million in funding so far to develop a “drone logistics system”. In our previous article on Matternet which we published late last year, we talked about how Matternet was working on delivering medical supplies in harsh environments like Haiti, Bhutan, the Dominican Republic, and Papua New Guinea. In addition to humanitarian logistics, Matternet’s big news this year was that they partnered with Mercedes Benz (an investor in Matternet) to offer delivery vans that launch drones from their roofs. That’s right. Here’s what the “Vision Van” looks like and you can bet it’s eventually going to be fully autonomous:
Whoever said logistics was boring when you’ve got hardware like that? According to an article in Fortune, Daimler AG plans to invest $562 million to develop “an advanced ecosystem of vans, flying drones, and robots – all linked via wireless networks – to speed up the delivery of packages and people“.
So there you have 3 startups using flying drones to deliver packages. You may be wondering why there aren’t more players in the drone delivery space. It could be that they were hiding from us in plain sight, or it could be for several other reasons. Firstly, there are a number of corporate giants with deep pockets like Amazon and UPS that are already making significant R&D investments into this space. This is a significant barrier to entry for a new startup. Secondly, the U.S. is behind the world in regards to legislation that impedes the advancement of drone deliveries. One look at the expansion plan for Dominoes shoes us that they’re going to target the easier markets before moving into the USA.
Countries like China are already using drones for delivery. A Chinese company called SF Express is already delivering 500 packages a day by drone and expects their drone fleet to reach “several thousand units soon”. Another Chinese firm, JD.com, has a fleet of 30 drones delivering packages of 11 to 33 pounds at distances of up to 30 miles. If what’s happening in China is any indication, it looks like once the legislative barriers get lifted in the U.S., adoption of delivery drones is going to happen very, very quickly.
Pure-play disruptive tech stocks are not only hard to find, but investing in them is risky business. That's why we created “The Nanalyze Disruptive Tech Portfolio Report,” which lists 20 disruptive tech stocks we love so much we’ve invested in them ourselves. Find out which tech stocks we love, like, and avoid in this special report, now available for all Nanalyze Premium annual subscribers.