Verity: How to win a drone war
A lengthy intro (and thoughts on progress)
As a kid, I asked my dad whether the world was really different from when he was a kid. To my surprise, he said, “No”.
The movies had promised space colonies. Reality was less “new frontier” and more “new software update”.
But, I asked him that same question a year or two ago. And he said, “Yes”.
Today we have:
cars that are (mostly) self-driving
chatbots that (mostly) pass the Turing test
private rocket ships that (mostly) make it into orbit.
We are most of the way towards some vision of the future. We just wear covid masks and yoga pants instead of space helmets and lycra.
Nowhere does that feel more true than in the world of drone technology.
This July 4th, for the first time, we witnessed widespread drone replacements for fireworks shows. In many places, this wasn’t just a show of technological might, but rather a pragmatic response to the risk of sparkler-born-wildfires.
Utopia or dystopia, take your pick. But the future is (nearly) here.
Verity: The Future of…Truth?
Which brings us to Verity, a drone company which just raised $11M in Series B funding. If you’re about to Google the company, their address is “Verity.net”.
I only clarify because there are several other companies with similar names. In addition to what appears to be a riveting murder-mystery novel. Much to the founders’ chagrin, I assume.
However, the Verity we’re discussing today is a drone company. Specifically, they’re a Zurich-based drone company offering fully-autonomous drone systems for inventory and warehouse management.
Take a look at some of their little guys buzzing around, joyfully scanning barcodes, and generally looking less expensive than your average fulfillment associate. Good stuff.
Drone Companies: The Commodity Product of the Future?
As a rule, drones are kind of a tricky business. Basically, improvements in miniaturization and battery science are what enabled the swarm (ha) of drones to burst onto the scene in the last decade.
Nowadays, you can get a decent quadcopter on Amazon for <$200.
I’m sure hobbyists and the military care about hardware specifics. But for most applications, there is very little difference between two comparable drones.
This is a very crowded market where we probably won’t see any one player winning any time soon. Notice how there isn’t a “Kleenex” or “BandAid'' for UAVs?
They’re all just drones.
So…What’s the secret sauce?
On their site, Verity claims to have developed their drone from the ground up. “Nearly 100 patents” and the miracles of Swiss engineering promise a superior product. Ok.
Although the confines of a warehouse likely don’t demand hurricane-proof rotors or particularly advanced AI navigation. Which is why their engineering probably isn’t anything special.
When you look at a picture, Verity’s flyers just look like…drones?
This is a drone
Apparently data collection syncs seamlessly with warehouse management software, but that seems like a bare necessity. Especially if you’re looking to play with the big dogs. And I think that’s the key here.
Verity is swinging for rapid adoption, implementation, and dominance.
Absolute victory (is about the friends you made along the way)
We’ll now reveal that Verity actually initially closed its $32M Series B round back in March 2023. They’ve raised more than $81M total since their founding in 2014.
So what gives with the $11M raise a few weeks back? Is Inflation pumping up burn rate? Unexpected new headcount demands?
I bet, it’s nothing like that. I think they’re taking the money just to get new allies on the cap table.
We haven’t mentioned yet that the Founder and CEO of Verity is none other than Raffaello D’Andrea.
You may not recognize the name, but this is the man who built Kiva Systems (now known as Amazon Robotics) the company that developed those little automated sleds that’re gonna zip around warehouses with stacks of inventory on their heads.
“Only the Swiss could make a Roomba terrifying”
D’Andrea knows the warehouse business. He knows the economics, the challenges, and the players. Raffaello D’Andrea knows what it takes to win.
And perhaps most importantly, he knows this is an industry where you don’t just have buyers and sellers. You have partners, and allies.
Equity Investment - The Marriage Alliance of the 21st Century
That’s why I think this most recent tranche of Series B funding was more strategic than it was necessary.
Of course, if you have the chance to raise cheap money, tradition would say go for it. You never know if you’ll need more runway down the line. But a smart founder never takes unnecessary dilution.
The recent $11M raise was led by A.P. Moller Holding, same as their previous B tranche. But the rest of the money came from Qualcomm Ventures, Exor Ventures, Fontinalis Partners, Airbus Ventures, Sony Innovation Fund, ROBO Global Ventures and Verve Ventures.
Recognize anybody?
Qualcomm is most known for their telecoms work, but they’re very active in IoT as well.
Exor is less well-known, but they’re a multibillion dollar holding company with significant stakes in companies like Ferrari, Juventus F.C., and Louboutin (awesome)
Fontinalis makes investments in mobility tech companies.
Airbus speaks for itself
Sony speaks for itself
Robo and Verve are both solid, traditional venture partners.
Half of these are strategic investors. And Verity’s history of partnerships shows their leadership understands just how important these relationships can be.
Verity is building a team of industrial technology allies that can catapult it to rapid adoption and industry dominance.
Energy equals mass times velocity (Don’t fight the herd)
Let’s be clear, there’s competition ahead. Gather AI offers a very similar autonomous drone product. And new entrants could change the game at anytime. But we can’t discount the value of momentum.
Everyone says VC’s like to pile into a sector or company once it’s already hot. If that’s the case, maybe they only do it because it’s a winning strategy.
Even early stage investors want to be confident you won’t lose their money. And there’s no better guarantee of that than a history of success. And…having some strong players in your corner. Some of that is simply because momentum builds momentum. And some of it is because once you’re strong, you can make strong friends. And then together, you can conquer the world.
Or at least, conquer the warehouse logistics industry. But that’s something!
Until next time. This has been,
The Weekly One Pager
