Neros Technologies raises $35M Series A to scale American drone manufacturing past 1,000 units/month

and in you know the tech right so okay um then how we doing we can he can't see you we just gonna run okay so you can hear us guy uh sain I got you guys fantastic okay sorry for the lack of video we're we're building the plane as we're flying it you're building the Drone as you're flying it giving us give us the update how you doing uh how was uh manifest demo day well uh yeah my co-founder Olaf was out there he he crushed it um I mean we we had a big announcement so we just closed our series a funding round $35 million going straight into more American drone manufacturing uh so really excited about that stuff um we also a few weeks ago announced our 6,000 drone production contract so we are now uh officially making over a th000 drones a month which I believe is the highest rate of any drone company in the United States uh so our our vision of mass is coming together but there's still a long way to go what's the main use case for these drones yeah I mean primarily we're we're building drones that are going to be putting Warheads on foreheads uh it's you know fpv Precision strike is kind of all the all the rage right now and you know our we have kind of two systems uh Archer and Archer strike uh Archer strike is the one where we're actually the Warhead integrator um it's basically a modular Warhead system and then we have Archer which is just the the plain fpv drone um and you can basically Mount whatever you want on there how do you think about scale longterm I think that's probably the the the number one question on you know people's mind that are following the industry you see this sort of footage coming out of uh China of of you know not even drone specific manufacturing capacity but when you just think of you know China's scale and that being uh you know one of our uh most obvious adversaries you know that's what you're up against uh you're clearly uh Not Afraid otherwise you probably wouldn't be doing this um how do we how do we sort of reach and exceed uh China's manufacturing capacity over the next 10 years given that they have a you know decades Long Head Start I think the question we need to be asking ourselves is what would happen if the Chinese supply chain was completely cut off and we had to build say a million of these systems in a year what would we do what would that look like and right now the answer is uh you know the entire American industrial base I think would be um would be a disaster and the even the defense industrial base would be scrambling to to make that happen um and we really need to do whatever we can to make manufacturing cool again and get people excited about working on this problem um I mean we've been sanctioned multiple times by China it seems like we're we're getting attention because we're doing something that is that is relevant uh but there's a long way to go guys 18 months into this very very long journey so you're saying neros has already been sanctioned by China we have yeah we were sanctioned a few months ago for the first time and then recently they they reup it um I think we were in the list with General Dynamics and a few others it's more prestigious than being on the Forbes 30 30 yeah I I see that as a huge bull case um what about uh C can you give us a little idea uh little overview of like what's actually happening at various orders of magnitude of scale you said you're doing a th000 a month I think um when I when I first met you and tour the facility it seemed like you were putting everything together by hand the founders were welding or soldering or doing everything uh now it seems like you probably have some Machinery in there but what does the path to like the lights out factory look like uh there was some debate on the timeline last week about you know you don't want to do too much automation too early but obviously we want to get to high production value uh numbers so talk me through that yeah automation is definitely the last step in the process and the the first step is designing the product around this uh you know this High rate manufacturing I think that's one of the big problems that a lot of the existing drone companies in the US run into is because they're basing off of one these pretty Exquisite compo components that are you know tough to to Source in high volumes um and they're really expensive and then two they just didn't actually design the airframe around uh you know these really scalable manufacturing techniques or having low human labor to be able to put it together so that was kind of the uh you know first thing we looked at when actually designing Archer um was how can we reduce the amount of human labor that goes into this thing so even if we're not automating yet because things are still in flux and we're not at crazy high volumes uh we're you know still spending say like less than an hour of human time per drone that goes together so that's really really critical I mean we've been in our current factory for about a year and in that time it's mainly been about optimizing the the main assembly line and it's still it's still a very manual assembly line but there's a lot of uh Tooling in place to make everything really repeatable and easy and then just the design of the Drone itself uh is very intentional yeah it's one of those things that you know people might say oh like they're putting these together by hand but that could actually be the right decision given where you are uh can you tell me a little bit about uh supply chain I've heard it's basically impossible to find an americanmade drone motor is that still the case is there a change there and are you leveraging any of the cool companies we've talked to like the hadrians the range views the the 3D printing companies like what what do you see as like really beneficial to you Motors are still a big challenge in the US uh I got asked on on on X the other day like oh are you guys winding your own Motors um and the answer is no we're not doing that yet we definitely want to be part of solving that problem and you know know there there are some things in the works but motors have been historically really tough a lot of us companies are still using Chinese Motors because it's not mandated by the government to to avoid them um and same thing with cameras especially low cost sensors we've seen there's just they're they're primarily dominated by China um and in our world and the fpv world really everything is kind of built on top of architectures that use Chinese Chips so our you know long time challenge um until we we finished the work and got onto the Blue uas List was rebuilding all of all of these components um from the kind of chip level because you'll you'll look at these open source projects that a lot of like drone racing technology is built off of and oh look at that it's it's off of a Chinese microcontroller or like every video receiver uh for analog fpv in the world uses this Chinese radio module um so you have to get rid of all that do all the engineering up from a a clean sheet which has been a big challenge but um you know we're we're getting there and it's great to see these companies that are working on the kind of like fundamental manufacturing challenges like that's what I would put um you know range you into the the bucket of like America needs investment castings um where we're we're sort of one level up where we're we have to be really smart on our component design but we're not actually you know making the chips sure do you think uh a lot of these suppliers over time uh can and should localize to a specific area you know China has a massive advantage you know with shenzen uh and you know a lot DJI being a lot of being able to Source a lot of you know components locally do we need that or is is it not necessary what's your vision of of how these things you know how we get to producing you know millions of drones per year that's what Elsa gundo should be baby let's make the American shenzen let's go let's do it um do you feel like you know you've been very successful at you know raising a significant amount of capital you know very quickly um how much um you know is there enough uh private investment into drones broadly or do we need to you know do do a multiple more I I posted um probably a couple months ago at this point that it felt like we needed a sort of project Stargate for domestic drone manufacturing like it seems like such a you know critical national security issue that you know potentially there needs to be an order magnitude more investment in the category or do you feel like there there's an adequate amount of investment yet I'll say that uh you know the capital is available to you know two companies um but it has to be directed really well because uh both on the you know private Capital side and the government side uh like my main ask to the the dod is not to spend more money it's to spend money in a different way it's to mandate higher volumes of systems that are lower cost um so it's not just about throwing money at the problem I think we have to uh set the expectations and those expectations might be in order of magnitude greater than you know like billion dollars goes towards buying a thousand loitering Munitions that should probably be a 100,000 um you know two orders of magnitude difference so it's not necessarily about spending more money I do think there is private Capital that is ready to go that's excited to get into this industry um on the government side I think there are really positive shifts happening in the direction I'm describing but that's where a lot of this will be driven from how's the transition uh gone from drone pilot to CEO I know you were running a a sort of uh drone oriented company in high school uh so you had a little bit of experience but uh does it feel like you're playing a video game when you're in slack and you're uh you know just sort of Manning the ship uh has it been pretty seamless yeah do you use slack in the fpv goggles uh that would be really locked in it's not slack it's iar he's on teams sure teams guy uh we we we we're actually uh we do use slack but not in the goggles I wish um but it's been an interesting transition I mean uh you know sometimes I do kind of look around and I'm like wow I you know used to just be flying drones off my back porch and now I'm now I'm doing this but I think I've always had this uh you know really strong natural inclination to start a company and I've been interested in startups for a really long time so it feels very natural like I understand the exact progression of why I'm doing what I'm doing but certainly a ton of learnings I mean we're also just moving really quickly um and so that comes with you know at times a lot of pain and a lot of uh a lot of lessons but it's it's been a great journey I'm I'm super grateful for what I get to do every day that's amazing last last tiny question will we ever see a neros consumer product uh we're I think dgi's number one haters over here we've been trying to get on the sanction we've been trying to we do a lot of cinematic things we want to film them with drones but we want to be American about it it's tough yeah I think the the market Dynamic right now is is in defense and that's where the most critical need is but um our mission is to fix the American drone industrial base so that doesn't just uh you know that doesn't just mean defense right I think way in the future there's a very good possibility that we'll be able to replace DGI on the the consumer shelves I would love to that'd be great amazing well thanks so much for stopping by we'll have to have you back next time there's a big announcement uh we really appreciate you calling in thanks so much congrats on the Milestone thanks guys see you we'll talk to you soon uh I want to go to Andrew huberman for a bit I mean unless you have something to debrief on that no no let's get into it uh because you got a shout out rora so out of nowhere out of nowhere on uh it was Saturday woke up uh I guess yeah it was around noon he says I find it weird that most of all the countertop reverse osmosis water filters are made of plastic the same industry that is built on keep contaminants out of what you ingest ethos puts clean SL cleaned water into plastic glaring contradiction I'm excited that rora water is metal so uh he's of course referencing to uh this product here uh I don't know if you can see it on the camera now but it's in the it's on the set here with us uh yeah we developed this product extremely intentionally to um eliminate as much plastic as possible from the system because we saw that uh the vast majority of filters that were supposedly filtering out microplastic um had uh you know huge amounts of plastic used in uh the process so unfortunate appreciate the shout out uh Andrew and uh yeah we we saw a massive uh pop in sales from this post alone as you can imagine um and uh it was very cool to see that's fantastic uh well there's other big news from Dan primac he says VCS always tell me they can't talk about active fundraising on advice of lawyers but that may be about to change the SEC has issued new general solicitation guidance that makes the process much less owner as for private equity and Venture Capital we may not see Times Square Billboards advertising new funds but we should uh but at least it's theoretically possible they say uh firms would also be able to discuss fundraising rep efforts with reporters that's huge uh so next time you're doing your big fund raise call into tvpn live announce that you're raising 10 billion doll micr fund to rip checks into 100 million companies yeah this has always been sort of done indirectly you know the somebody will leave a fund and they'll be announcement oh they're coming out but um yeah we want to see oneone Billboards of all the big Asset Management 100% I mean we talked about Scout funds you know you're you're a scout at a venture capital firm you find a company take some of their money put it in there I want to see Scouts on the