Neros Technologies CEO: inside Ukraine's Operation Spiderweb and the future of drone warfare

studio and uh ask him how he's doing. How you doing? There he is. Welcome. Great. How are you guys? We're good. We have a new soundboard, so expect some wild some wild cards. Some wild stuff. But yeah, uh we we we uh we missed you on Teal Fellow Day. I hope you're doing well.

Um, maybe you can kick it off with just a a brief uh overview of what you're tracking in the news. I mean, we just we just covered this uh this incredible Ukraine operation. Um, what information, how are you processing it?

Let's let's have him do a quick one minute intro for anybody that didn't hear him the last time and isn't familiar at uh with your background. That's great. Yeah, absolutely. Uh so I am the co-founder and CEO at Nuros. Uh what we're doing here is building massively scalable defense systems starting with drones.

Uh my personal background is I was a professional drone racer for a long time. I've been building and flying FPV drones, first-person view drones for about 10 years.

Uh competed with Team USA, won the world championship, started a company in drone racing, uh and then got really really pulled into defense a couple years ago. Uh and now Nuros has been around for about two years. Uh, I've been over to Ukraine many times.

We have a lot of products deployed there and we are now the the highest rate drone production line in America. So, we've been really trying to ramp production. Um, you know, looking at what the Ukrainians are doing and taking a lot of inspiration. And how much of the drones right now are FPV versus fully autonomous?

Is that is that an important distinction for what you're building? Um, yeah, it is an important distinction. Although the line is starting to get more more blurry. Uh the vast majority are FPV and in in Ukraine too.

Uh the vast majority of drones in general are FPVs and the vast majority of those are completely manually piloted. Yeah. I had no idea that you started a drone racing company before this. Did you ever get that to scale or was it still just like benchtop?

I remember the first time I saw your facility, you were kind of hand assembling. It sounds like now uh the the supply chain is much more robust, but what was the what was that early experience like? Yeah. So the company uh it's actually still operating.

Primarily we were focused on at the beginning we were focused on building the uh materials for race courses. So there weren't really there wasn't a really good place to go for serious racing pilots to to buy like the the gates or what they called what you actually fly through.

So we you know this this was a lot of actually working with the Chinese uh you know industrial base figuring out where we can go to get these better materials.

Um, and then a lot of the arbitrage was actually in the shipping, figuring out how to do um, you know, shipping all over the United States of these very heavy items without driving the cost super high. And then we moved into uh, other types of components.

We we we like to collaborate with kind of the top racing pilots in the world. So, we make like frames and motors and other things that are really tailored to the needs of uh, the best pilots, but it's still operating. I' I've passed it off now.

Uh but it was a really good experience also to see how easy it is to go on Alibaba and you know get something done in a matter of weeks. Uh basically like zero to full product in a matter of weeks versus you know working with US suppliers that would maybe maybe get you a sample.

Yeah, those gates are somewhat tech enabled, right? Because I' I've seen like the LEDs on them and do they actually have a sensor that can tell if the drone went through the circle? So they do.

that's usually on the kind of hobbyest setups that's that's more on the like just start and finish gate and it's a separate system. Um our ours were purely just a a fabric but that is a key part of it as well. Yeah, that makes a lot of sense.

Uh before we dive into the news, uh specifically the news over the weekend, could you give us a high level overview of the history of drone warfare in Ukraine? Because I understand it's been progressing super rapidly uh on both sides and I and it'd be helpful to understand kind of the different stages.

Do they ever have like predator drones like the global war on terror type of drone or did they jump straight to quadcopter and kind of like leapfrog the technology? So, you know, you've had this this uh Russian aggression war in Ukraine since 2014.

Obviously, the full-scale invasion was 2022, but even during that that period before the full-scale invasion, there was some usage of drones for surveillance and uh dropping explosives. These are primarily still like small drones like what you're seeing now. Uh but this was not a a proliferated technology.

Then when the full-scale invasion happened uh within a few months Ukrainians started thinking about all these ways that they could use you know inexpensive drone technology to get a an asymmetric advantage and that is where FPV drones started becoming a really really big deal.

So they pioneered the uh really this idea of you know putting an explosive on a racing drone and using that as a precision strike weapon. There were instances of this happening in other places, but they really scaled it and they've really refined it.

And then Russia was was much slower to take it seriously, although now they they tend to uh in some ways outproduce Ukraine and they have a much, you know, more direct line to China um where most of these components are coming from.

But since 2022 and FPV is just starting to get used now, it's reached an unbelievable scale. Uh it's estimated Ukraine is going to produce 4 and a. 5 million FPV drones this year.

And those are ranging from, you know, ones that are this big to 15inch propellers, uh fiber optic controlled drones, many different types and sizes of warheads, um different configurations. And I can talk more about the drones that were used in in Operation Spiderweb as well because those were really interesting.

But uh what we've seen is just this vast technology landscape um where new clever ideas like fiber optic are you know going to be the the hot thing for a few months and then they sort of just become another tool in the tool belt and it's just this constant arms race. Yeah.

talk about uh talk about this this attack was was unique in a bunch of different ways, but is this something that had been and to your knowledge or or just you know more generally known to be something that had been attempted multiple times or you know maybe like uh I'm curious to know um yeah kind of the backstory on on this type of attack because it seems you know it's massive difference to be using this technology way behind enemy lines.

versus using it, you know, at the front line. Yeah. So, primarily FPV drones are used on the front line, say the kind of 30 km band across the zero line. What was so unique here is that it was FPV drones, short-range drones being used 4,000 km inside of Russia.

Um it it was this unbelievable application where you know you've seen Ukraine using long range one-way attack drones that are going you know 1500 kilometers um to strike targets deep inside of Russia. But here these were small drones actually driven in on on uh trucks basically in the tops of shipping containers.

Um and I don't know of any uh operations that were similar to this beforehand. I think uh it was not something they wanted to uh give away and the drones were actually operating on cellular. They were not operating on local like the the normal low latency local radios you use for FPVs typically.

Um and so I think you know this is going to be something that a lot of people are going to look at and and see if you have drones that are operating on cellular you can't really tell them apart from cell phones. That's really hard to defend against, really hard to detect.

Uh but now it's going to going to be part of air airbased defense is um thinking about drones that are operating on cellular being piloted from basically anywhere in the world. Yeah. Talk about uh talk about the Russian response, the immediate response to this incident.

Uh from the footage that I saw and I think most people saw that that uh tracked it, it it seemed incredibly challenging to respond to it quickly. Right. by the time you could sort of organize a response, a lot of the the core damage had been done.

Uh what what do you think the the the the question I think that every country is asking themselves now is how do you defend against this type of attack whether you're at war like Ukraine and and Russia are or you're just you know thinking uh you know long term.

Yeah, this clearly poses a massive threat to critical infrastructure. I mean, being blatant, the US does not have any defenses in place that would stop this from happening. We already know, we there's already news stories about drones that are flying over our Air Force bases, and we can't do anything about it.

And I think the only approach here has to be a a multi-layered system where you're looking at all of the different types of electronic warfare and also considering things like satellite communications and cellular communications where you're basically able to turn those off on the flip of the switch, which is a huge uh a huge inconvenience and a huge uh thing to build into the infrastructure, but clearly that's going to be required.

And you mean that just just to drill down there, you mean uh asking Verizon or AT&T or every cell provider in a certain area to turn off, you know, cell coverage because a drone took off, you know, is is or a fleet of drones or a fleet of drones.

But either way, it's hard to tell if they're a threat or just, you know, some recreational use. I mean, I I'm I'm sure many people on the internet will tell me why this is a very stupid idea, but when I think about this, uh, it's clearly the Russians were not equipped to jam drones operating on cellular.

That is totally possible and we could have, uh, better cellular jammers. Um, but if they had been able to recognize this threat immediately and turn off all the cellular networks in that location, then it basically would have stopped this this operation completely.

Uh, and so that's where my mind immediately goes with something like this. Do you think they had electronic warfare or or radio blocking equipment set up at that air base and it just you're saying it wasn't functional or it wasn't for that particular band. It wasn't it wasn't blocking cellular.

It might have been blocking low latency. Uh I forget what what was the what's the actual frequency for the radio that you were using with the heads-up display that we were we were playing. It depends. So that's the that that is the the point.

So basically, you can actually see in the videos, um, the drones take off and they have GPS, and once the attack starts, they lose GPS, which means GPS is getting jammed, which makes total sense. That's that's a common way of defending against these one-way strike drones.

So air bases are going to already be set up with GPS jamming and you know, so is Moscow, so is Kiev. Like that's common. Um, but they're not set up to just obliterate cell phone usage on air bases. Um, and and they probably do have jamming for uh some like control links in the 915 mehz range, video links in the 5.

8 GHz range. Um, there's other common ones that are probably they're more well equipped to jam. Um, but when I I think what caught them so by surprise was the use of cellular. Yeah.

I mean, yeah, we've talked about some of the different You said there was kind of like an ensemble approach to stopping these types of attacks.

um walk through some of those because I remember seeing like oh we're going to train eagles to catch the to catch the the the drones or we're going to just have guys with shotguns that shoot them or uh anvil drones or uh nets or electronic takeover there's so many different approaches and it feels like at least in the US defense tech space there's a whole bunch of startups going after different counter drone counter UAS strategies and it feels like uh there might be an ensemble one What do you expect to kind of be the the the mix or the road map or the tech tree that we go down to kind of prep for defense against this type of thing?

First off, our strategic bombers should be inside of hangers. I think that would be a great start. Yes. Uh but as you mentioned, there are these really basic things like nets uh that that do help against FPVs, but uh you know, that's not going to last very long, right?

I think you're going to see a a mixed layer, especially with uh electronic warfare combined with interceptors combined with uh the sort of kinetic defeat like the Bullfrog system uh where you know you have an automatic machine gun turret that's able to to shoot drones out of the sky.

The last line of defense is really guys with shotguns uh and that that can actually work against an FPV drone, but uh you don't want to be want to be relying on that.

So, I think it's one of the things that worries me the most is that I've never seen a jammer in the United States made by a US company that can reliably take out FPV drones. And I think we're very very far behind in the practical application of of uh electronic warfare, especially with these like local radios.

So, I I believe this is a huge area where we need to start investing dramatically and putting way more attention. Yeah. Okay. So, I want to walk through a little bit more of this. Um, you mentioned GPS gets jammed, then they're going over the cell network.

Um, there's probably a way to provision like almost like licenses to operate on the cell network that might make it harder. I imagine that they had to like effectively like buy Russian SIM cards and set them up in the drones.

But, uh, talk to me about the the actual flight experience of flying remotely over cell because I imagine that it's low, it's high latency, low bandwidth. So is this like when you fly it's remarkable. It's like super precise.

I imagine this is a little bit more jerky and a little bit slower and so you could probably take advantage of that but can you characterize the type of flying that we might have seen if we were on the ground that day? Absolutely.

So I spent a lot of time looking at the flight videos and the pictures of the FPV drones and these are not normal drones. These were very special uh special builds to accomplish this.

So, one of the key characteristics of these systems um that are operating off of cellular where you do have high latency control is they are fully stabilized. So, they're doing altitude and position hold, which is not actually normal for an FPV drone.

Normally, you're running on a a firmware called Betaflight, which was developed for racing applications, and it's really precise. It flies really well to a human pilot. Um but it it doesn't really have built-in stabilization.

they were using Artypilot, which is another open- source firmware, and it's used widely across drones, uh, but not usually for racing drones or for FPVs. And so, you can see that it actually shows in the onscreen display from the videos that they're they're doing that position hold.

And you can tell, um, it's it's not like a normal FPV drone where they're putting it at kind of any angle. And what was also really interesting is they set these up to not fly into the target forward like you would with a normal FPV strike drone.

They descended flat onto the target and they had a camera on a gimbal that can point down. So what you would usually do is is have a warhead that's pointing basically in the same direction, forward direction as your FPV camera. And on these drones, they had two warheads that were basically pipes between the motors.

That way they could descend with that camera looking straight down and descend onto the area with the fuel tanks of those bombers. Uh, and the other advantage of that is that those drones inherently were flat and and stable when they're sitting in the container.

Instead of having one big round warhead on the bottom, they had these two smaller ones on the sides, which made it much easier for them to pack them flat inside the top of that shipping container. Interesting. And so having a relatively larger target than a FPV drone would typically had enabled that, right?

They just had to land kind of within a I don't know. I don't know what the the surface area was, but 20 something feet to really have the effect.

They were landing on a pretty precise location, but it was it was they were able to do that, especially because they knew the targets were stationary and it's pretty easy to descend, you know, onto a flat wing versus if you're going after a moving vehicle or a soldier, anything like that.

Uh descending flat onto them is going to be really, really hard, especially in that full stabilized mode. Yeah. Yeah. Uh what do you think the pipeline is for identifying targets? Are they using satellite imagery to see that the bombers are not in hangers and then they can uh clock that in? Yeah.

What wasn't there there was a treaty at some point too that required bombers to be parked Oh. that I think it was I'll look it up. Well, that might be rolling back soon. No, I think it did get abandoned already, but but there was some historical precedent for uh nuclear assets needing to be um visible. Yeah. Yeah.

I want to talk about uh target identification and then I want to talk about um just uh essentially complete offline drone flying and targeting with computer vision and kind of closed loop basically doing geogesser on the fly and just popping up and realizing like look around.

Okay, I'm in I'm like I I I can kind of guess that I'm a thousand miles outside of Moscow. There might be uh a target somewhere nearby. I'm going to fly over there. Okay, I see I can identify a hanger. I can identify a bomber. Before we dive into that, let me give some context so I don't leave people hanging.

Uh so there was a treaty that the strategic arms reduction treaty start one signed in 1991 by the United States and the Soviet Union included provisions for transparency and verification such as placing strategic nuclear delivery vehicles like bombers at declared satellite observable locations to ensure compliance with the treaty's limits on nuclear arsenal.

So um it was broadly uh it was suspended by Russia in 2023 but there was still this sort of global infrastructure for storing these types of assets in a way that you wouldn't store them today if you were sort of building systems uh from first principles. Yeah.

So to answer your your question, John, u I have to imagine that satellite imagery and also just you this was a very well planned out plan for a year and a half operation and it was clear that u Ukrainian SBU was operating inside of Russia on the ground and so it was pretty easy for them to gather that intelligence of where the bombers were and you know when would be the right time to to strike.

Uh so I don't think that's the you know that's not the main challenge here. Um but there was a lot of talk on on X about using AI and and training models to identify the planes and and people saying that this was u autonomous drones. To me I watch these videos very closely.

There is nothing to indicate that these were autonomous drones. It actually to me looks very obvious that they're they're fully manually piloted.

Um, and that also makes sense where where you have a a oneshot mission uh and you spend so much work to set up this cellular network or you know these drones that work on the cellular network. Uh it would not make sense to trust that to um some kind of unproven terminal guidance on a completely new set of targets.

Totally. Where we will get to is drones that are able to accomplish missions like this completely autonomously.

And what you were kind of alluding to is is like this GPS deny navigation world that's getting a lot of attention right now where basically you have kind of your known map and then you have what the camera sees and you're able to match those together and and say look this is where I am.

Um typically you need to do that in a pretty confined space because you have to preload all of that map data. Sure.

But uh that's really really useful if you especially on these these one-way strike drones, the larger drones when you're trying to do deep strike and hit a precise target and you've accepted the fact that GPS is just going to be completely useless because and cellular as well. Right. Right.

So so so total total signal jamming, but you you maybe don't have to load like all of Google Street View from all over the world, but you could load in just this thousand mile region in in in Russia and then you kind of know that we're going to start here.

So, you need to be grounding and then you can compress that ideally with some AI maybe or or just some general compression to to load as much as possible on the drone.

But I'm wondering about like if we're if we can't do that without like an Nvidia GPU on board, that's going to change the weight and cost and all the economic equations around this. But it sounds like we're maybe close to that already.

I can speak from the nearest perspective which is we are specking all of our autonomy to uh work on a computer that doesn't kind of ruin the inherent nature of an FPV drone, right? Needs to be small enough. It needs to be low enough cost and that doesn't tend to be an NVIDIA GPU for the systems we build.

Um but you can still do a lot with that and and there's also these much more traditional uh forms of of navigation. you know, inertial navigation's been around for a very long time and works quite well. Um, and so you what you want to do is actually combine these different things together.

Um, and it's going to depend on the the user and the doctrine if they will be okay with drones just fully autonomously going after targets. But, uh, it's it we are getting very close to the point where you could have a lowcost FPV style drone that's completing a mission basically on its own, flying to a certain area.

I scanning four targets, identifying those targets, and then basically just saying like go or no go, and then you just have to click a button. That's that's what I think we're actually approaching quite quickly. Yeah. Are there uh international treaties around that?

I mean, it feels like the the decision to maybe not destroy a military asset that doesn't have a human on board, but certainly to like take a human life, that feels like a pretty distinct Rubicon that would be uh discussed in the global order at or at the UN before it happens.

Um, and yet it does seem inevitable as technology progresses, but where are we in that type of discussion and like Geneva Convention stuff?

I think the line gets blurry with AI because we've had weapons for a long time where you press the button and once it fires and it could be flying for hours and you're still never calling it back, right? Like a cruise missile, right? Or even just like a like a mortar shell, right? Exactly.

And so my opinion here is that the systems that Nuros builds and these systems that are are enabled by AI and and uh drones in general are are are much more precise and cause much less casualties of civilians. True. And that idea I think is is starting to proliferate. But um it's it's heavily debated.

I don't think anyone could give you a a perfectly clear answer of this is exactly what everyone's agreed upon because uh when you get in a situation like Ukraine where you are just defending your territory and it is an allout war uh those things don't seem to matter as much, right?

You're just you're you're coming up with the most clever solution to get it done with your limited resources. Um and so I think it's it's really the only thing that matters is what is actually going to happen in a real conflict.

and we can look to Ukraine for that and we can think about uh what potential adversaries the United States has in the future. Yeah, it does seem like the like like if the Ukrainians had the choice to to you know like send a couple more mortar shells and like kill 50 Russian people.

They would have much rather just destroyed the capital assets of these exquisite bombers that are very hard to build and are and are, you know, not like strictly speaking more valuable than human life, but certainly like more strategic to the to the war effort.

Uh so yeah, it makes sense that like a precise instrument like a drone would actually favor targeting the the the the the bomber, the asset as opposed to the human, which is potentially how are you seeing you you mentioned a little bit about how the the warhead this time around was different and that it was flat so it could be packed into the the truck.

What what is the what's the general evolution of of of that you're seeing on on the warhead side? So, the classic image of a Ukrainian FPV drone is a 78 10 inch FPV drone with an RPG7 warhead. Yeah.

Duct tape or zip tied to the bottom and some type of homegrown initiation board to actually trigger that and then there's a blasting cap that just goes in the back of the RPG7. That's like the most common setup and there's a lot of images of that.

For a long time now, Ukrainians and Russians have been building purpose purpose-made FPV warheads, and these can be, you know, basically from scratch. Um, we on our systems have warheads that are are very purpose-built for the uh the intended target.

And so that's really just depending on the mission, you're able to quickly swap on, swap off um various different warheads. And I think that's the the ideal scenario where you can support a a wide array of different effects uh and swap them out quickly.

Can you talk about the economics between the drone and the munition? It seems like the like the the disposable drone was quickly adopted. Um and is that a function of the fact that the warhead costs more than the drone or they're roughly 50/50? What's the evolution been there?

Because you could imagine if you wind up in a world where munition cost is driven to five bucks and the drone is still hovering around a couple hundred. Well, then it might make sense to release the munition and try and return the drone even if it's somewhat low probability.

Yeah, the costs are roughly 50/50 on an FPV system. And it it really depends, but I I would put it roughly 50/50. Um, why you don't want to release the munition is because the point of an FPV drone it is that it's the cheapest and most precise guidance system you can have.

So, as soon as you decouple that, even if it's very close to the target, you're losing precision and it's not a great cost to actually blow up the drone, right? And you we do have bigger bomber drones, which makes sense because those are much more costly and they're able to carry very very heavy warheads.

But to me, the the uh reason why an FPV is so good is because it is actually just kind of a guidance system around a warhead. Yeah. When you say we, you mean the US armed forces, not near us? Uh I I mean common sense the collective. Yeah. Yeah. Yeah.

Um so yeah, what what what is in the in the Neuros portfolio right now? How is how is uh scaling production been?

And I'm interested in specifically knowing uh like what are the downstream what are the frustration points that you've experienced building that manufacturing line that you maybe even expect someone to build a startup around to make it easier.

Uh I've been talking to a lot of uh defense tech friends who are employees and I've been telling them like if you just go into the the the most hypers scale the most aggressive startup like if you want to be a founder but you crush it there like you might discover something that needs its own its own business instead of like looking at a market map and trying to decide that way like go experience the pain.

So where has the pain been where has been the opportunity uh and and how has that process been scaling up the manufacturing line? So speaking to our our current products, uh we produce Archer, which is our our FPV drone, uh built on an allied supply chain.

It's certified by the DoD for for usage and to be cyber secure and supply chain secure. Uh we have Archer Strike, which is the version of that where we actually integrate the warhead system. And then we have our our various different ground stations for different use cases. Um crossbow is more tactical and portable.

Longbow is our max range, max anti-jam ground station. Um we have other things in the works but the the main focus has been scaling the production of Archer and the ground station. Um it was quite painful earlier this year.

We went through sort of the first version of a production ramp which I think for any company ends up being a really really painful time for us.

It was all of our not all but we have all of these custom electronics that we we bring in from a board house in Arizona and uh we were finding these really high failure rates in some of the designs and sometimes it wasn't even because of something we were doing and so we had to spend a lot of time to get those components to a really high first pass yield.

Uh so for a while it was lots and lots of testing uh lots of drones failing at the end of line test. Now we're in a really stable spot and and that is is going quite well. We're uh shipping very consistently about 1500 drones a month, but uh ramping that actually very fast.

On the ground station side, there's also been a lot of engineering challenges. Um but I think what's more interesting, what you were alluding to is is the supply chain.

And uh one of the big things that I think you'll probably hear a lot of drone and defense tech people talking about right now is the supply chain for brushless motors.

uh we have worked with a a partner outside of China to scale up their capacity, but even right now that's still a a game where, you know, we're pushing them to go faster, pushing them to make new specs, um and and they are not prepared for the volume that we're doing and that we're planning to be doing quite soon.

So, this is one that I've seen a lot of folks getting interested in. I think there's some really good efforts that are starting to uh appear within the US and and allied countries for making brushless motors.

Uh but there's probably going to be need to be a lot of people serving this because there's many different sizes, many different specs. Um one of the challenges here is also the the neodymium that goes into the motors. Uh and the other raw materials are also typically controlled by China.

So there's a many many layer supply chain problem that you know one single drone company isn't going to fix on its own. Yeah.

I talked to a a friend who was uh doing business with a international founder who had experience uh in the brushless motor industry in China and was thinking about setting up an operation in America and was asking this this other friend um go oh yeah like we want to get set up but of course like we want to be where the action is because we have a supply chain uh we'd love to set up in the brushless motor district in America like wherever the district is where all the brushless motor companies are like we'll set up there so that we're just just walking distance.

So if we need a specific material and they had to explain like no no no no like America doesn't even have a district for that that's not even a concept here like we don't have any companies but we also don't have the rest of the supply chain and and China's really really done a great job of like creating not just the power law outcomes like the DJI's of the world but also all the minor supply chain companies they're all right next to each other so if you need some piece of you know equipment you can just go across the street it's kind of like what's happening at Elsagundo right now you guys are building it up where can go over to Cameron at range view and say, "Hey, can you help me with this part?

" or something like that. Um, but it's we're we're a lot earlier on that curve. So, uh, hopefully hopefully it's solved. I I I know people have flagged the brushless motor, uh, industry, uh, quite early and so people are definitely working on it. Yeah. Anyway, thank you so much for coming on.

I'm sure you're going to have a very busy week. I'm sure we weren't the first people to uh, give you a call, shoot you a text. We appreciate you coming, ask uh, get your thoughts. So, thanks for coming on and breaking it down and uh, thanks for doing what you do. Yeah, we'll talk to you soon. Cheers. Thanks guys.

Uh, quickly let me tell you about numeral uh, sales tax on autopilot. Spend less than 5 minutes per month on sales tax compliance. What is this? It's just a cool sound effect. Go to numeralhq. com. Put your sales tax on autopilot. Uh, next up we have Connor from Lightseed coming in. Uh, he's been on the show before.

We're going to get an update from him on all things in the defense tech world, what he's thinking about, how he's seeing things in the government. Welcome to the stream, Connor. How are you doing? I'm good. I'm