By Krystal Hu
(Reuters) - Neros, an autonomous drone startup founded about a year ago, has raised $10.9 million in a seed round from Sequoia Capital to build a new factory and manufacture more drones to sell to Ukraine, the company told Reuters.
Neros joined a series of American drone companies trying to capitalize on the huge demand for drones in the Russia-Ukraine conflict, where thousands of unmanned aerial vehicles (UAVs) have been deployed at unprecedented scale to track enemy forces, guide artillery and bomb targets.
Founded by former professional drone racers Soren Monroe-Anderson and Olaf Hichwa, Neros said it had designed, manufactured and shipped drones to the battlefield in Ukraine within months of the company's launch.
It is currently producing hundreds of drones a month, and plans to use the funding for hiring and scaling up production.
Neros competes with Chinese drone makers that currently dominate the Ukraine market at cheaper prices. With its systems priced in the low four figures, Neros said it aims to be cost effective while using non-Chinese supply chains.
The company said it is also in conversation with the U.S. Department of Defense about using its vehicles across the Army, Air Force and special forces.
"What we really want is a cost-effective, performing product that serves Ukraine and the DoD combined, and no one's accomplished that yet," Neros CEO Monroe-Anderson said in an interview.
This deal also marks Sequoia Capital's continued bet on defense tech, a sector it first joined other Silicon Valley venture capital firms in investing in last year.
"I think Neros is already best designed in the world for their class," said Shaun Maguire, the Sequoia partner who led the deal.
"The next step is having more skilled supply chain purchase, having as much as possible be from U.S. suppliers and all of it from Western suppliers."
(This story has been refiled to correct the spelling of 'Sequoia' in paragraph 9)