Neros Raises $10.9 Million to Supply Drones to Ukraine

Insider Brief

• Neros has secured $10.9 million in seed funding from Sequoia Capital to expand its manufacturing capabilities and increase drone production.
• Professional drone racers Soren Monroe-Anderson and Olaf Hichwa founded the company just a year ago,
• The round also shows Sequoia Capital’s increased interest in defense technology.

Neros, an autonomous drone startup, has secured $10.9 million in seed funding from Sequoia Capital to expand its manufacturing capabilities and increase drone production for Ukraine, the company told Reuters. The funds will be used to build a new factory, hire staff and scale up production, officials added.

Founded just a year ago by former professional drone racers Soren Monroe-Anderson and Olaf Hichwa, Neros has quickly positioned itself among American drone companies aiming to meet the soaring demand for UAVs in the Russia-Ukraine conflict. Thousands of drones have been deployed in this conflict to track enemy forces, guide artillery and bomb targets.

Neros said it designed, manufactured and shipped drones to the Ukrainian battlefield within months of its inception. The company is currently producing hundreds of drones each month and plans to use the new funding to further ramp up production.

Neros faces competition from Chinese drone manufacturers, who dominate the Ukrainian market with cheaper prices, Reuters reports. However, Neros aims to be cost-effective while relying on non-Chinese supply chains. Its systems are priced in the low four figures, which the company believes makes them competitive.

In addition to its operations in Ukraine, Neros is in discussions with the U.S. Department of Defense to potentially supply the US Army, Air Force and special forces with drones.

“What we really want is a cost-effective, performing product that serves Ukraine and the DoD combined, and no one’s accomplished that yet,” said CEO Monroe-Anderson in an interview with Reuters.

This deal also highlights Sequoia Capital’s ongoing investment in defense technology, a sector it began investing in last year along with other Silicon Valley venture capital firms.

“I think Neros is already best designed in the world for their class,” Shaun Maguire, the Sequoia partner who led the deal, told Reuters. “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.”