IE 11 Not Supported

For optimal browsing, we recommend Chrome, Firefox or Safari browsers.

San Diego Startup Nets $165M for Military Drone Software

San Diego's Shield AI, a startup that makes artificial intelligence software to power military drones and other aircraft, has raised $90 million in venture capital and $75 million in debt in a new funding round.

A 3d rendering of a military drone flying over a desert.
(TNS) — San Diego's Shield AI, a fast-growing startup that makes artificial intelligence software to power military drones and other aircraft, has raised $90 million in venture capital and $75 million in debt in a new funding round.

The 400-employee company said the new investment gives it a valuation of $2.3 billion — making it the fourth defense tech startup in the past 20 years to achieve such a lofty value. The others are SpaceX, Palantir, and Anduril, according to the company

This latest round comes on top of $300 million that Shield AI raised last winter and summer. Since then, it has doubled its workforce and is still hiring. It has facilities in San Diego, Dallas, Washington, D.C., and Abu Dhabi.

Founded in 2015, the company's artificial intelligence software acts as an autonomous pilot for military and commercial aircraft — providing planning, mapping and other artificial intelligence tools to enable aircraft to do dynamic flight maneuvers on their own.

Its technology has been used on drones in conflict zones by the U.S. military since 2018. Its core AI software stack is called Hivemind, which powers Shield AI's Nova-class unmanned aerial vehicles. These drones are small surveillance UAVs that operate in high-threat, GPS degraded environments.

That means Nova drones maneuver in blacked-out or communication-jammed conditions, including inside buildings, to detect threats and provide intelligence.

"We work within the constraints that are present," said Chief Executive Ryan Tseng. "The thing that has to be true is should the communication link fail, the robot on the edge still needs to be effective. It has to have the intelligence to do its job and protect itself."

In addition, Shield AI's Hivemind software stack soon will power a larger, vertical take-off and landing unmanned aerial vehicle called V-BAT — which it acquired through the recent buyout of Martin UAV. V-BATs are considered medium-sized drones, about 10 feet tall with a 10-foot wingspan.

In addition, Shield AI's technology will be flying on larger aircraft later this year for a first test flight. The company recently bought Heron Systems, which makes AI software designed for jets. Heron won the AlphaDogfight Trials in 2020 put on by DARPA — the Defense Advanced Research Project Agency. Its AI system defeated a U.S. Air Force F-16 Weapons Instructor Course graduate five times in a row. Heron's software stack has been integrated with Shield AI's, said Tseng.

Shield AI was co-founded by Tseng, an MIT graduate and former head of a wireless charging company, and his brother Brandon Tseng, a former Navy SEAL who served in Afghanistan and other overseas hotspots.

The third co-founder is Andrew Reiter, who worked on one of Draper Lab's most successful robotic guidance systems.

This latest funding round was led by Snowpoint Ventures' Doug Philippone, who has also served as Palantir's Global Defense leader since 2008. Other investors include Riot Ventures, Disruptive and Homebrew. Previous investors include Point72, Andreesen Horowitz, Breyer Capital, and SVB Capital.

"The future of defense aviation is autonomy. AI pilots are the most disruptive defense technology of our generation — and Shield AI is committed to putting the world's best AI pilots in the hands of the United States and our allies," said Tseng.

© 2022 The San Diego Union-Tribune. Distributed by Tribune Content Agency, LLC.