In today’s drone market, lots of startups sprout in every direction. Most offer grand promises about new age drones that can revolutionize the way you see machines. Some offer new features like longer battery life, a more specialized camera, or even a new program built in. Most of these startups use the platform Kickstarter to amass funding by pitching their ideas to the public. The public can then donate funds to make the startup a reality, and in return, they get perks when the company starts selling.
But not every startup gets to see the light of day. Not every Kickstarter campaign ends in a multi-million profit for their creations. Most of them simply fizzle out and cease to exist before they even get rolling. All that hype, all that funding, and then nothing.
Airware Meets a Dead End
A similar scenario happened recently with the drone startup Airware. Airware recently amassed over $118 million in funding, where they aimed to create their own drone hardware to compete with the big brands like DJI. They also planned on creating a cloud storage system centered on drones. Here, companies worldwide can use drones to inspect their businesses in place of using manpower and expensive aircrafts to do it themselves.
A bold plan, considering creating a brand from scratch can be a difficult endeavor. Airware snowballed into about 140 employees before the inevitable implosion. The end was so unexpected that their staff did not even know about the bankruptcy. Not until an email was sent out of the company’s plans for shutting down.
So what went wrong?
Apparently, they wanted to make software and hardware with a very specific niche. When your items only appeal to a specific – very narrow – market, growth can’t be a possibility. According to previous employees, Airware spent a lot of their startup money trying to create programs that can’t be utilized by today’s drone technology. They spent all this time and effort creating hardware that ended up being a bust, burning a lot of money along the way.
Their insistence of avoiding the paths of bigger companies like DJI proved to be their own undoing. Turns out, maybe – just maybe – a successful drone company was doing something right. They overspent trying to create their own path, and it came back to bite them. It was not about the product, but more on the management and their financial woes. Had their owners spend their money more wisely, they might still be afloat today.