Whilst drones are certainly a contentious topic, they’re proving an excellent opportunity for startups and could have a significant positive impact on society
There are few technologies proving quite so compelling – or controversial – as drones. But despite the ambivalent public feeling toward the technology, startups are swarming into the sector, eager to stake their claim in the new frontier that drones represent. “It’s such an unexplored area at the moment,” says Giles Moore, co-founder and CEO of Airstoc, the drone video marketplace and stock site. “That’s why it’s so exciting.” Development in the sector is now so rapid that potentially revolutionary innovations are emerging on an almost daily basis. And, unsurprisingly, many startups want in on the action.
Part of the reason drones are providing such potential for innovation is they can offer untold efficiencies for a range of sectors. “We’re hearing about new applications all the time,” says Moore. New use cases seem to be emerging on an almost daily basis, whether that’s keeping homes secure, monitoring the health of crops, inspecting power lines or surveying disaster zones. “No one really knows where the industry is going to go, where it will stop or how many applications people will find,” he adds.
But hardware and services don’t present the only opportunity for startups looking to get in on the act. “People don’t really appreciate the size, shape and scale of the data market that drones are creating,” says James Harrison, co-founder and CEO of Sky-Futures, the drone oil and gas inspection service. With drones becoming more ubiquitous and being fitted with increasingly sophisticated sensors, the sheer quantity of data they’re acquiring is creating the potential for a whole new ecosystem of data and services startups. “That’s a big opportunity that people haven’t really even looked at yet,” Harrison says.
Unsurprisingly, the potential of the drone sector has gotten investors salivating. Tech giant Intel recently made a massive $60m investment in drone manufacturer Yuneec Holding. Meanwhile DJI, perhaps one of the most famous drone manufacturers in the world, netted a colossal $70m this May from Accel Partners and partnered with the VC firm to set up SkyFund, a $10m investment pool for early-stage drone startups. “There’s a lot of interest from the investment community in this industry,” says Joel Smith, VP of business development at Trace, the auto-follow filming drone startup. “Many people are talking about how much it’s going to grow.”
However, the huge level of interest that drones are attracting does mean there is a risk of some people getting carried away. “It’s an area that has a huge amount of hype,” says Harrison. “There are very few companies making any money at all; half of the services don’t even have a product, let alone revenues.” Because of this, there are almost certainly some pundits who feel that drones, like wearables before them, may become the victims of their own hype.
Fortunately, it seems unlikely that drones will struggle to get off the launchpad. “If you look at all the great products in history, success has been down to how we communicate the use cases for them,” says Smith. The iPhone succeeded in changing the world because it had so many clear use cases, whilst the Apple Watch has failed to because it didn’t. Unlike wearables, there is a huge range of pain points that drones can solve, whether it’s tracking the spread of disease or monitoring algal blooms. “The applications are essentially endless,” Smith explains.
But no matter how excited investors and the wider industry get about drones, it can’t be denied that, amongst the public, they still have an image problem. “Last year there was a lot of bad press about drones,” Moore says. Concerns over privacy and safety mean the incipient introduction of the technology hasn’t been met with the warmest welcome. But Moore feels that the hostility toward drones comes from their knee-jerk association with surveillance. “Drones aren’t out there to spy on people,” he says.
As the public begins to understand and experience the benefits that drones can deliver, it will likely start to allay some of these fears. “The more that we demonstrate applications for drones that are saving time, money or lives, perceptions of them will improve greatly,” says Smith. He explains there are already plenty of news stories emerging reflecting the good they can bring; one of the drones produced by Draganfly Innovations, a drone manufacturer acquired by Trace, is currently displayed in the Smithsonian as the first to save a human life. “Drones are doing good for humanity and that’s going to be a continuing story,” he says.
Inevitably, however, regulation is going to be vital in winning public confidence. “You need to have a legislative framework,” says Harrison. “But the industry needs to be leading regulation, not the other way round.” If all stakeholders involved – regulators, the public and the industry itself – are allowed a seat at the table, coming up with regulations that protect everybody’s interests becomes much easier. And, if worked out properly, effective regulation will offer a level playing field that will allow new players the room to innovate. “If you have clearer rules or legislation, that will actually drive innovation as opposed to inhibit it,” Harrison adds.
As long as there’s legislation that everyone is happy with, there is no end to what can be accomplished. “It’s going to sound cheesy,” admits Smith. “But the sky’s the limit.”
In your footsteps
There are few companies that can demonstrate the future potential of drones quite like Trace. The business was born from a chance meeting between Cameron Chell, CEO of Business Instincts Group, the venture creation firm behind image and product recognition startup Slyce, and Paul Beard, the technologist and entrepreneur. “They came together with an idea to allow an unmanned vehicle to follow a user autonomously and simultaneously stream the content it’s creating,” says Joel Smith, Trace’s VP of business development.
Fast forward 18 months and Trace has created a camera system that plugs into autonomous drones – be they aerial, ground-based or tripod-mounted – and will track and film the user wherever they go. “When you click it into one of Trace’s vehicle systems, it will automatically integrate, launch with the autopilot functionality and use the visual intelligence data to power that vehicle,” Smith says. This allows users to easily film live action footage on the go, whilst their every move is effortlessly captured by their drone and uploaded straight to the Trace Live Network.
But Trace isn’t content with merely cornering the consumer market. “It became clear to us that Trace has an opportunity to really capitalise on the commercial sector as well,” says Smith. To this end, Trace announced in July that it had acquired Draganfly Innovations, a commercial drone manufacturer operating in sectors such as law enforcement, agriculture and surveying, with an aim to bring the strength of its image recognition and tracking technology to commercial drones. As Smith says: “It really was a match made in heaven.”