San Diego AI startup corrals $210M for drone technology used by military
The San Diego Union-Tribune August 25, 2021
SAN DIEGO (Tribune News Service) — San Diego's Shield AI, an artificial intelligence startup that powers small military surveillance drones, said Tuesday that it has raised $210 million in a late-stage round of venture capital funding.
The new investment values the 200-employee company at more than $1 billion — making it a rare unicorn in the nascent defense technology space.
The company expects to layer in an additional $75 million in debt and $15 million in equity in the coming weeks to bring the total raised to $300 million.
Founded in 2015, Shield's artificial intelligence-enabled drones have been used in actual Middle East conflict zones by the U.S. military for the past three years, according to the company.
Among its products is the Nova-class unmanned aerial vehicle platform, which can operate in high-threat, GPS and communication degraded environments — maneuvering autonomously in blacked-out conditions and inside buildings to provide surveillance, intelligence and reconnaissance.
The company was co-founded by former Navy Seal Brandon Tseng, who served in Afghanistan and other overseas hotspots. Tseng's goal was to provide U.S. forces with drone scouts that could enter buildings, send back photos and maps, and identify armed enemy fighters inside.
Tseng was joined by his brother, MIT graduate Ryan Tseng, in founding Shield AI. Ryan Tseng is the former head of WiPower, a wireless charging technology pioneer that was acquired by Qualcomm.
The third co-founder is Andrew Reiter, who worked on one of Draper Lab's most successful robotic guidance systems.
"The funding round enables Shield AI to move one step closer to its goal of becoming a 21st century defense prime (contractor) through a software first approach," said Chief Executive Ryan Tseng, "where products derive a strong competitive advantage from an autonomy and artificial intelligence backbone — similar to what you see across the consumer product market where great hardware is differentiated through great software."
Shield AI's software is called Hivemind. Its algorithms enable planning, mapping and position estimation so drones can execute complex flight maneuvers autonomously, among other things.
The company's hardware includes its home-grown Nova platform and V-BAT UAS, which it acquired through the recent buyout of Martin UAV.
Martin makes drones up to 125 pounds that are launched from vehicles. It has contracts with the U.S. military and commercial customers.
Shield AI also recently bought Heron Systems, which makes software designed to power autonomous jets. Heron won the AlphaDogfight Trials last year put on by DARPA — the Defense Advanced Research Project Agency. Its Falco AI system defeated a U.S. Air Force F-16 Weapons Instructor Course graduate five times in a row.
Prior to this latest funding round, Shield AI raised $90 million in Series C round in February.
Its lead investor in the Series D round is Disruptive, based out of Austin, Texas. Previous backers include P72, which also participated. Other early investors include Breyer Capital and Andreessen Horowitz.
Based downtown, Shield AI aims to hire engineers in the San Diego area and other locations to further develop its technology.
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