The venture capital arms of Microsoft and Airbus are betting that the business of drones will one day soar.
AirMap, a startup specializing in software for drone navigation, said Thursday that it received $26 million in a funding round led by Microsoft (MSFT) Ventures. The startup, which declined to comment on its valuation, now has roughly $43 million in total funding.
Other participants in the funding round include Airbus Ventures, Qualcomm (QCOM) Ventures, Sony (SNE), Japanese e-commerce company Rakuten, and China-based aircraft company Yuneec.
AirMap has received a lot of attention from the drone and aviation industry over its technology that lets drone pilots be aware of flight conditions and local and national airspace rules. Airport traffic control operators also use the software to discover if drones are flying nearby.
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In June, former Alaska Air Group (ALK) CEO and chairman William “Bill” Ayer joined the startup’s board and said he was hopeful that AirMap could one day integrate its navigation technology with existing air traffic control systems.
Nagraj Kashyap, the head of Microsoft Ventures, said the funding round is the first time Microsoft’s VC arm has invested in a drone startup since the VC unit debuted in May. Microsoft has not yet chosen who will represent the company as part of AirMap’s board, Kashyap said.
Although Microsoft is “not in the business of building drones,” the tech giant could eventually benefit by providing the cloud-computing infrastructure that helps startups like AirMap deliver their software services to customers. He compared what Microsoft hopes to provide in the drone space to its efforts in convincing customers to use its Azure cloud computing service, as a backbone of sorts for Internet-connected cars.
For Airbus Ventures, the VC arm’s CEO Thomas d’Halluin said his firm would act as the “middleman” between AirMap’s team and the Airbus “mothership,” adding that the two companies can make their respective air traffic management systems work together.
Although Airbus will not have a representative on AirMap’s board, he said that Airbus would be involved in the startup’s business strategy and help it build relationships with airports, companies, and regulators around the world.
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Historically, Airbus has concentrated more on building things like airplane wings and fuselages, and AirMap would help the company with its software ambitions.
Still, while AirMap’s technology is novel, d’Halluin acknowledged that the company is still new and it will need help making sure its technology can scale and work properly as more people use it.
“We want to help them build the essential safety infrastructure that is able to both introduce and secure the traffic patterns in the airspace,” d’Halluin said.
Improved air traffic management systems that can accommodate drones will be even more important if flying cars eventually take off as well, he predicted. Airbus, for example, said in January that it’s working on a prototype of an autonomous flying car that it hopes to finish by the end of 2017.
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“Yes, flying cars are becoming a reality,” said d’Halluin.
Santa Monica, Calif.-based AirMap has 50 employees, and recently opened a Berlin office and an office at the NASA Ames Research center in Silicon Valley, said the company’s CEO, Ben Marcus. The startup is one of several companies and universities working with NASA on a new drone air traffic management system.
