Welcoming SkyWard to the Founders’ Co-op Family

I’m thrilled to announce that we’ve just completed an investment in SkyWard. This is a first for us in several ways:

Before I tell you more about any of those firsts, I want to thank Erik Benson of Voyager Capital for introducing us to the SkyWard team. Erik led a seed raise for the company last year and has worked closely with Jonathan, Mariah and Marcos (the CEO, COO and CTO, respectively) to flesh out the opportunity and lay the groundwork for what became a hotly-contested raise early this year.

A bet on our drone-filled future

As seed investors, our job is to find opportunities that we believe the institutional venture capital market will be excited about a year or more from now. Predicting the future is hard (and we often get it wrong), but the ubiquity of commercial UAVs (Unmanned Aerial Vehicles) has seemed inevitable to us for a while now. The core device technologies required to support this market are well-understood, and UAV hardware and operating system leaders like 3DRobotics and DJI are already shipping millions of dollars worth of production-ready equipment worldwide.

The biggest limits to widespread commercial adoption of UAVs aren’t customer demand or device capabilities, but rather the legal, regulatory and financial frameworks that businesses need to invest with confidence in any major new market. Imagine the headlines — and lawsuits — if an Amazon drone carrying a five-pound payload at 500 feet lost power and plummeted onto an urban playground or busy arterial street and you’ll have some sense for the concerns that both regulators and commercial operators are wrestling with.

As software investors, we hadn’t found a natural entry point into the hardware-centric UAV market, but SkyWard’s focus on enabling systems and platforms was a perfect fit. Jonathan Evans, the CEO and co-founder, is a licensed commercial aviator with a deep respect for the role that the Federal Aviation Administration and national air traffic control system play in ensuring safe skies for both commercial and hobbyist aviators. He saw that the accelerating scale of commercial UAV operations would force the need for a similar real-time tracking, reporting and safety compliance environment. But rather than replicating the existing systems, the UAV version would need to be scaled to manage millions of small, autonomous aircraft operating in dense urban areas. 

SkyWard has partnered with the leaders in the commercial UAV market — including top OEMs like DJI and 3DRobotics, specialty insurers like Global Aerospace and Transport Risk Management, and industry working groups like the Small UAV Coalition and NASA’s UTM Program — to define requirements for the “digital system of record” that can enable safe, compliant and insured commercial UAV operations anywhere. SkyWard currently offers a beta version of that system to a select group of industry partners, and will make it generally available to commercial operators later this year. With continued execution (and a bit of luck), SkyWard has the potential to become the software and data standard for safe, regulated operation of commercial UAVs globally.

A remarkable syndicate

Betting on the future of a nascent market is always risky, but when the leaders in that market begin to coalesce around a solution things can come together very quickly. The syndicate Erik put together includes world class early-stage investors, deep-pocketed growth investors (Norwest), and the global leader in backbone system operations (Verizon). We were also very happy to be making our first co-investment with our friends at the new Techstars Venture Fund, a team we know and love from our work at Techstars Seattle.

A happy return to the Portland market for Founders’ Co-op

Founders’ Co-op has been an active investor in the Portland market since our first bet on four guys whose previous business sold bacon online, and who were bootstrapping their new company with the help of Oregon’s generous unemployment benefits. That company — Urban Airship — went on to raise over $75MM and is now one of the anchor tenants of the Portland startup ecosystem.

We’ve made several more PDX investments since that first one, including AppFog (acquired by CenturyLink), Tindie (moved to the Bay Area) and Vadio (still cranking along). Along the way we’ve had a chance to work with many of the leaders in the Portland ecosystem — including Rick and Renny at PIE, and Angela and Jim at PSF. Late last year were honored to receive a fund investment from the Oregon Growth Board as part of their economic development strategy for the region, and we’re always scouting the PDX market for opportunities to put that money to work locally.

We’re delighted to be able to play a supporting role in building a new tech leader in Portland. Many thanks to everyone who helped us along the way — and most especially to Jonathan, Mariah and Marcos for creating such an incredible company!

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