Dual-Use Tech Roundup - Security, Flight, AI, Drones & Quantum Computing

21 February 2022 - Featuring Non-Dilutive Funding Sources, Evolv, ORB Aerospace, Reveal, Auterion, D-Wave & MSBAI

U.S. DoD & IC Non-Dilutive Funding Sources:

This week's newsletter highlights organizations that receive and deploy non-dilutive funding from the Department of Defense. The chart below contains information about eleven of these organizations. These select few were chosen from the chart provided by the Defense Entrepreneur Forum (DEF) that was included in the NNV newsletter from January 10th, 2022. These organizations invest in startups in order to spur innovation for future warfighters and the Department of Defense. Some of these organizations also provide incubators and accelerators to encourage collaboration amongst start ups and provide support in the early stages of these ventures. The deal round-up includes notable companies that have secured funding from one of these companies.

Deal Round-Up:

Evolv: 🔐

Massachusetts based security company, Evolv, combines AI and advanced sensors to offer touchless security screening. These systems can be adapted to serve different industries and are trained to differentiate between weapons and harmless items. In-Q-tel participated in the company’s $18 M Series B round of funding on March 14th, 2017. Since then, the company went public via a reverse merger in 2021 by acquiring NewHold Investment Corporation. The company currently trades on the NASDAQ Stock Exchange under the ticker EVLV.

ORB Aerospace: ✈️

ORB Aerospace has developed an aircraft that uses a variety of propulsion systems in order to provide efficient vertical and horizontal flight. AFWERX participated in the company’s $3.0 M Seed Round along with Michigan Economic Development Corporation. The round closed on October 1, 2021. Prior to this round the company raised a $350,000 Angel Round from undisclosed investors and then raised $132,370 in Equity Crowdfunding.

Reveal: 🗺

Reveal Technology utilizes applied AI to develop 2D and 3D mapping for drone imagery. This system can be utilized by warfighters in remote and high-risk environments to aid in decision making. The Defense Innovation Unit (DIU) participated in the company’s $2.45 M Seed Round on June 8th, 2020. This investment came in the form of a development contract to create a tactical AI software for soldiers and marines. The company went on to raise an undisclosed amount of money from Red Cell Partners in an Early Stage VC Round in January of 2022.

Auterion: 🛸

Auterion has developed an open software platform for drones. This platform helps companies integrate large scale drone operations and data into one workflow. The company received $2.0 M in grant funding from the Defense Innovation Unit (DIU) on April 29, 2019. After the grant, the company went on to raise CHF 10.85 M ($11.34 M) from Preface Ventures and other undisclosed investors. 

D-Wave: ⚙️

Quantum computing company, D-Wave, works with customers in order to provide solutions to maximize their efficiency. The company utilizes quantum annealing to optimize solutions for commercial use. In-Q-tel participated in the company’s $45.97 M Series E round of funding on October 4th, 2012. After that round of funding the company went on to raise eight other rounds of VC funding totaling $209.14 M  and received three grants from the Canadian government totaling $102.05 M. The company has agreed to go public via reverse merger on February 6th, 2022. The company will be acquired by DPCM Capital for $1.6 B and will be listed on the NYSE under the ticker QBTS.

MSBAI: 🖥

MSBAI (MicroSurgeonBot.AI) has developed a platform that allows companies to run specialized simulation software without the need of an engineering specialist. The platform leverages High-Performance Computing (HPC) and AI to create a platform that can be easily understood without the need for specialized training. The company has participated in four accelerator programs with AFWERX and received over $2.4 M from these programs. Previously, the company was a part of the Techstars incubator and the Los Angeles Cleantech Incubator. More recently, the company raised $834,304 of crowdfunding via StartEngine Crowdfunding on October 27, 2021.

What We’re Reading:

• How to Invent Defense Products  - Vannevar Labs

• Jeremy Hitchcock: Cyber security here and abroad  - Union Leader

• Pentagon fights defense industry consolidation  - Yahoo News

• Mike Bloomberg Named Chair of Defense Innovation Board  - Defense One

• Securonix Receives $1 Billion+ Growth Investment Led by Vista Equity Partners  - Securonix