New Brunswick drone parachute manufacturer Aerial Vehicle Safety Solutions announced Monday that it had inked an investment deal with Japanese specialty venture capital firm Drone Fund.
The agreement, which took less than three months to negotiate and finalize, is part of an ongoing fundraising round that will include both equity and debt financing.
Aerial Vehicle Safety Solutions, or AVSS, makes parachutes that can deploy when drone engines fail or drone operators lose control, with the goal of preventing injuries to anyone standing underneath. Drone Fund is based in Tokyo and invests only in technologies related to unmanned aircraft.
“There’s a 12-hour difference, so there was a lot of hopping on the phone at 12 o’clock at night,” said AVSS vice-president of operations Mariah Murray in an interview. “But how keen they were and how keen we were, it showed a lot. It moved very fast.”
Rothesay, NB-based AVSS says its product reduces the risks of drone use in cities and above large crowds, where mechanical failures could prove hazardous. In February, 2019, the company entered into a two-year agreement with NASA to study drone safety in densely populated areas.
Murray declined to comment on the size of the Drone Fund deal, citing concerns that it could impact other negotiations.
“We’re still closing some money here, so we’re just not ready to disclose the amount,” she said. “All we can really say is that it has provided us with an ample runway to execute on opportunities.”
According to Murray, AVSS employs seven full-time staff and about 30 contractors, with plans to increase its salaried employee count to about 20 people by the end of the year.
“I think it’s about controlling of timelines,” said Murray. “We’re comfortable enough now that we’ve worked with some experts and we know who we want and need on the team… It’s time to bring people in-house and have their full attention.”
AVSS plans to begin shipping its products to dealers within the next several weeks. Its parachute assembly for the DJI M200 drone — one of the most popular commercial drones on the market — will be carried by about 20 percent of the outlets that sell the drone.
The M200 parachute has also been certified by industrial standards organization ASTM — a process that involved 40 different testing scenarios.
An additional product launch, building on AVSS’s current product lineup, is in the R&D phase.
Murray said COVID-19 has caused minor production delays, the result of periodic problems sourcing materials, but that basing its manufacturing in Atlantic Canada has allowed the company to minimize pandemic-related disruptions to its operations.
AVSS has raised capital previously as it received a $100,000 investment from the New Brunswick Innovation Foundation in the organization's fiscal year ending March 31, 2018.
"It's cool to see that a company created in New Brunswick is able to leverage investment and attract more international funding," said NBIF Investment Manager Thomas Bird, adding that the geographic gap between AVSS and Drone Fund would have necessitated a high level of trust from both companies. "It just proves that New Brunswick can punch above its weight."