During a year where mass transit on planes, trains and buses has reduced the number of passengers in the wake of the Covid-19 pandemic, one of the startups hoping to be groundbreaking in a whole new way to get individuals from A to B – flying taxis – – have collected significant funding.
Volocopter, a take-off from southern Germany (Bruchsal, specifically) that has built and tested electric VTOL aircraft (vertical takeoff and landing), has raised € 200 million (approximately $ 241 million) in a Series D funding round. In addition to the aircraft, Volocopter has also built a business case where the ships will be used in a taxi fleet in urban areas. CEO Florian Reuter says that live services are now two years out for the two vehicle models it has developed.
“We actually expect to certify our VoloCity in about two years and start commercial air taxi operations immediately after,” he said. “Paris and Singapore are in pole position [as the first cities], where Paris wants to bring in electric air taxis for the 2024 Olympics. With our VoloDrone, we expect the first commercial flights even earlier than with our VoloCity. “
So far, Volocopter has demonstrated its craft on flights in Helsinki, Stuttgart, Dubai and across Singapore’s Marina Bay. In addition to Europe and Asia, they also want to launch services in the United States.
For some contexts, this is basically on the right track with what the company had previously forecast: 2019 – when Volocopter took up a initial $ 55 million in funding for its Series C (finally ended 87 million euros, about 94 million dollars) – the company said it was three years away from service.
The latest (over-subscribed) Series D includes investments from a mix of financial and strategic supporters. Funds managed by BlackRock; global infrastructure company Atlantia SpA; Avala Capital; spare parts for cars Continental AG; Japan’s NTT via its venture capital alert; Tokyo Century, a Japanese leasing company; Several family offices include new investors. Volocopter also said that all of its existing investors – that list includes Geely, Daimler, DB Schenker, Intel Capital, btov Partners, Team Europe and Klocke Holding and more – also contributed to the round.
If it sounds like a big list, it is something intentional, because the task of what Volocopter is complex and requires a broad ecosystem of other players, says Rene Griemens, the company’s CFO.
“Getting urban air mobility from the ground requires a complete ecosystem that we are developing right now. Many of our strategic partners will support us in various aspects of the supply chain, scale components, enter markets, improve operations, among other things. Most of them know some aspects of our business model really well (eg Japan Airlines for aviation, Atlantia for infrastructure), he said. “Their investment is a reflection of their excitement over Volocopter as a leader in building the entire UAM ecosystem, giving credibility and comfort for purely financial investors. “
He added that many of these companies have a very “practical partnership” with Volocopter. “DB Schenker, for example, is rolling out leading heavy-duty electrical logistics drones with us around the world.”
The company has now raised nearly $ 390 million. We ask for an updated valuation, but for some context, PitchBook data estimates the valuation now at $ 624 million.
Moon shots and sunsets
Volocopter was founded in 2011 and has now been working on its idea – characteristic of its very wide circular design that sits where the rotor of a helicopter would be – for a whole decade, and in many respects it is the classic idea of a moon shot in action.
It has not yet made any money, and the product it builds to do so is very groundbreaking – flying into completely uncontrolled territory, so to speak – and therefore ultimately unproven.
But all of these have faced various obstacles from investor sentiment to bankruptcies, accidents, mothballed projects and divestments (perhaps most importantly, Joby picked up Elevate last year when Uber stepped away from expensive moon shots).
And most importantly, none of them are flying commercially yet. With Volocopter (as with the others), investors have made a long-term investment here in a concept and a team that they believe can deliver.
At present, the company says that technology is no longer the barrier, nor do it seem like regulators who in the pandemic are more focused on considering new approaches to old problems to improve efficiency and recognize that we may have to do things a little differently from now, in the wake of new demands from public health and the public.
When it comes to VTOL crafts, the promise has always been that they could circumvent many of the problems with street congestion in urban areas and provide a more environmental alternative to gas-spraying, current modes of transport.
The challenge, on the other hand, has been to determine the safety both for completely new units and also for the traffic and other systems under which they would operate. With the idea that in the end, these crafts would be autonomous, which adds another complex twist.
Interestingly, regulators in different markets who may have been more skeptical of new concepts seem more open to looking at them differently now with the pandemic at hand. This has played out in other arenas, such as the electric scooter market in the UK, which saw a bolt in activity after regulators long skeptically gave them a provisional nod last yearwith reference to the need for more individualized transport options in a country affected by a pandemic.
Volocopter’s model is based on transporting a person or small lots, so in a way it can be attractive here as well.
“There are no major obstacles anymore when it comes to technology as such,” says Retuer. “It’s now about execution. EASA has defined what is necessary to get electric air taxis certified to the highest level of safety in aviation. We have the best technology on the market to certify according to EASA’s high safety standards and will keep our heads down to complete the remaining steps to certification. “
However, he said that the other challenges that remain are those of a very technical start: “Our biggest challenge right now is talent acquisition, “he said. We are looking for the best talent worldwide and our team is growing fast now, so that we can accelerate on the technical and market development side. Especially in the markets where we will open early routes, such as Paris, Singapore, China and Japan, we go at full speed to prepare everything needed, from digital infrastructure to landing sites, city approval and more. “