Rain Maker raises $25M Series A to scale cloud seeding operations and vertical integration

wasn't complete nonsense. Like, it actually made sense. Where's the water gonna come from? Yeah. Yeah. It's a big question. Anyway, um uh we're always excited to have him on the show. In the meantime, um he is. Yeah, let's bring him in. Let's do it. How you doing, man? What's up? Boom. Look at that contact.

It's a It's a a size gong occasion. Rain Maker just raised or just announced its raise of $25 million for our series A. Fantastic. Congratulations. 25 million. uh uh give us the breakdown on the deal. Who who who in? Okay. Yeah. So, it was led by Lower Carbon.

So, that was uh Ryan Orbuk and uh Clay Clay Duma um Chris Saka founded the fund. They're really interested in adaptation tech now, right? Like in the face of severe weather uh and change of climate, how do we build technologies that can um uh make us more resilient, right?

Um so more resilient to drought um more resilient agriculture more from cloud seating is one way to facilitate that. Um and so they were stoked. Uh Naval Ravocant um sage philosopher king of tech bros everywhere. Uh he was in I think just cuz we went for like a really long romantic walk in Manhattan Beach one time.

Um and then uh Greg Bernstein from ACEP, Sovereigns Cap, some uh really great uh Christian mentors and leaders for me. And then um Drover Ventures as well. Drover Ventures, William Clark, great dudes. Um, so that was the deal there.

Talk about uh talk about what the process was for the raise because from from what I know, this this is being announced now, but but got done a while back, it was uh from everything I heard extremely uh competitive process. What What were you really looking for in that lead check?

Um, yeah, I'll tell you that and then I'll show you all of the crazy [ __ ] that we've been working on with the money since we actually did raise it because that's the more exciting part. Um, what we were interested in then was uh technical sophistication.

Um, cloud seating unlike even a lot of deep tech is an inordinately complicated business. You need to be really good at weather modeling, at aerosol chemistry, at radar, um, at a bunch of other electronics. Um, meteorological radar is crazy unto itself.

the avionics of the drone, boutique anti-icing systems, new chemistries, uh, for new cloud seating agents. And so, um, here is some of the stuff that, uh, we had to diligence our investors on whether they'd be able to understand what went into building novel meteorological radar.

Um, to be clear, this is all behind you is all renders, right? Like this is this is Yeah, this is on a green screen. A great great cat model. Um, so anyway, in 6,000 square feet, which is nuts, um, we've started high rate production of our drones, um, which are anti-icing capable drones.

They're the only class one UAS in NATO, uh, that can fly in severe icing. And so this is one uh, of our Elizas right here. Um, so it has thermal anti-icing systems. Uh, ridiculously difficult to engineer aerosol dispersion system. Um, that tunes the particle size that you're emitting into the cloud exactly as you wish.

Um, and then over over here, I can't even begin to show you this. Actually, that's probably proprietary. I won't show you our boards, but here's some more material going into some more drones. Here's the next unit of our radar that's going to Argentina. Uh, our second international deployment.

Um, so I'm pretty stoked about that. Here is all the proprietary uh radar stuff because we had to design our own boards. Um and then on the other side of the house is like our novel chemistry work. Um that uh by the way I'm taking this out of Aaron Sloff's playbook just like walking around a factory.

That's the fun stuff that's going on. Yeah. So uh I mean talk about the use of funds. It seems like you're buying a lot of stuff, hiring some people. What's the breakdown? probably doing mostly like founder le growth and sales but um where is the money going um generally? Yeah.

So I would say it was probably something to the effect of um like 30 30 2020. Um so 30% of all the money that we raised uh is dedicated to designing our own meteorological radar and atmospheric sensing platform. Um so that platform is called Eden.

Um that is radar, LAR, uh longwave infrared, aerosol probes, pressure, temperature, humidity probes, and animometers. Um it's one of the more, if not the most sophisticated and low price point atmospheric sensing systems on the market in the world right now. And the lead time is only 5 weeks instead of nine months.

Yeah. And out of curiosity, did you try to buy that off the shelf initially and then realize that you had to build it yourself? What did that look like? because that feels like its own that feels like a bit like its own uh product line although it doesn't sound like you're selling it to uh individually yet. Yeah.

So basically everything at Rain Maker you know I am grateful and happy to be making money and eventually returning capital for our preede investors but like our thesis initially was like well we're going to use off-the-shelf radar off-the-shelf drones offtheshelf chemicals offtheshelf weather models and just be like a really good systems integrator.

And then we got punched in the face like a hundred times and decided we had to vertically integrate everything. So tried to buy that radar CS, but there's one guy in Germany that makes them for 51 grand and they take 9 months if not 12 months to get there.

Uh our system is about five times more cost uh cost effective, more affordable, and um the lead time is five weeks. So we did that. About 30% of the funds went to designing Elijah, our class one UAS um that's capable of anti-icing.

Um that was a big thing that about 10% uh 20% was for novel research so fancy probes so that we could detect the right conditions in cloud validate our effect uh and then the remainder went to um GA you know fighting Florida fighting for bigger budgets that sort of thing. uh talk about acquisitions going forward.

I mean we've seen I mean Ander will just announced another acquisition. It seems like in in defense tech and hard tech um there are assets that can be you know you can create more value if you roll them into a larger more agile more founder organization. Are you looking at that? Have you done it?

Are you thinking about it in the future? Uh how do you how do you think about um building versus buying everything? Yeah. So, so one of the really strategically important things that Rainmaker planned to do from the outset was roll up the existing cloud seating market.

Um, if you look at the market as it stands, it is it ostensibly doesn't exist. There's like a few legacy operators that are kind of cowboys that blast clouds randomly and states or municipalities or even like Saudi will pay for it because they're so desperate for water.

They're willing to try anything even it's even if it's technically unsophisticated. Um, we uh bought North American Weather Consultants, which was a old school cloud seating company out of Utah, out of Salt Lake City. Um, did so with Project Finance, uh, which was great. Shout out to my finance director, John Madigan.

Killer. Um, and then, uh, we injected our tech into it. The organization was extraordinarily wellrun there. We've retained everybody because they're great operators. Um but we injected our tech, upsold that, have been getting better yields because of it, more transparent reporting to our customers.

Um I think that we'll continue to uh roll up the existing market. I also think that um there's a lot of novel probe and uh material science companies that Rain Maker's targeting as well.

Um so anywhere where we can inject our tech or just accelerate growth by deploying stuff faster and at a better margin is part of the plan.

How much push back did you get initially around people that were like, I I love I love the idea of what you're doing, but I don't see but like I'm trying to find comps in the market and I can't find any. Is this a market?

And I'm assuming your answer was like, well, the tech didn't exist and we're actually creating the market, but but what was your you know, was that was that your you know, kind of primary answer there?

It seems kind of obvious in hindsight that um there could be a uh a technological sort of um barrier between the the a demand for something like cloud seating and the ability to actually deliver on it. Yeah, absolutely. Got push back um on that.

Like a lot of what we had to say was like well this is actually deep tech and frontier tech. Sorry there's no comp. Um like do you want to participate in something net new or not? And so our investors were were really solid about that.

Um but the thing that I did say which has pros and cons looking back is you know SpaceX uh is like a launch services provider for now. We're a cloud seating services provider. Um we rather than get stuff to orbit as a as a function of our service.

We build all of the hardware we operate all the hardware and then get precipitation down on the ground. Um, I think over time we'll probably trend more towards um an exorbitantly high margin utility just because cloud seeding water is the cheapest water that you can produce.

Um, but also we'll start buying up land too and then look very strange, maybe more like Monsanto or a hedge fund. Uh, Alcatraz is in the news. Uh, what's the coolest thing we could possibly do with Alcatraz? What's your pick for the next move with Alcatraz?

I think uh to to catalyze more conspiracy theories putting heat on us, we should put a huge EMF array like HARP there to flood the San Francisco Bay. What would that do? We don't know. We don't know yet. We're going to find out. Um I uh maybe last question uh but like what's the revenue mix look like right now?

because I I I only uh know uh last investor update I saw from from Rain Maker, I was pretty blown away by the traction. But what you know, talking generally, you know, where where does the revenue come from? Is it is it you know, individ like local governments, states, countries, private, you know, industry, etc. Yeah.

So, first of all, Jordy, you'll find out soon, but uh we've doubled our realized revenue since our last investor update. Wow. Oh, there we go. Yeah. And um so I would say about what's the math? 85% 86% is domestic. The rest is international.

Um and then another about 75% of all the domestic revenue comes from state governments. So um departments of natural resources, departments of agriculture, uh the remaining 25 is small municipal or ski resorts that need more snow. Makes sense. Yeah. Very cool. Very cool. Very cool.

And when you when you uh last last question, when you talk to these end customers, I I imag do are you feeling like I'm assuming you're feeling the product market fit where they're like, "Please do this. " Like, "We need this.

" And and and I'm I'm assuming at no point were they like, "Oh, I don't you know, why why would we why would we want more precipitation? " Um but maybe talk about how those conversations go.

Someone made a really salient quote tweet of u Gary Tan's uh post of like the gif of the whatever bouncy ball game where like when you hit PMF everything like runs away. Yeah. Um like deep tech is not like that at all. DTEK the demand is like so obvious from the jump.

People have been desperate from the very beginning when we like didn't even have a drone to fly saying like hey if you can figure this out we would love to buy more rain and buy more snow. Um, it was just a matter of getting to the point where we actually had an operable system.

And everything changed for us in October 2024 because we picked up the entire company, moved it to a rural hamlet in Oregon um to do more intensive testing and then everything really accelerated and we got the the system ready and to a point where we could sell it and um people people are desperate for more water.

So that's been straightforward. Amazing. Cool. Well, great having you on. Congrats to you and the whole team on the milestone and I can't wait for the next investor update. We'll see you soon. Godspeed, guys. Thanks. Godspeed. Uh, up next we have Bucky Moore moving over to Lightseed, shaking up the industry.

Many people have been saying this was a maxed out maxed out contract for sure. I texted him as soon as he told me. You've been going absolutely maxed out. I'm super excited to chat with him. He has been on a podcasting