Precision airdrop changes air cargo network topologies and unit economics
Los Angeles-based freight-tech startup DASH Systems announced Wednesday morning it closed an $8 million seed round led by 8VC. Tusk Venture Partners, Loup Ventures, Trust Ventures, Perot Jain and Make in LA also participated in the raise.
DASH Systems founder and CEO Joel Ifill has a vision of making next-day delivery available anywhere in the world. What makes that possible and economical is a new approach to air cargo previously only seen in military applications: dropping precision-guided pods directly from small aircraft.
“DASH Systems is an innovative solution to delivering commercial packages at a fraction of the cost and at a higher speed than traditional services,” said Jake Medwell, founding partner at 8VC, which also invested in FreightWaves. “8VC is incredibly active in the logistics industry and a number of our largest partners are excited to work with DASH. We’ve already seen top engineers and talent quickly join the DASH team, which is an early sign that things are working and major problems are being solved.”
Ifill’s family in Barbados experienced regular supply chain disruptions and humanitarian crises from tropical storms and hurricanes; later Ifill became a welding engineer in the aerospace and defense industries. Ifill has taken his understanding of how freefall weapons are put together to build something useful for people in need.
The technology required to deliver precision airdrop freight successfully and repeatedly is complex. DASH writes software that guides the aircraft’s pilot through space and tells it when to release the pods. The startup also builds its own cargo-handling system that holds the pods — which look like boxes with electronically controlled fins — and the pods themselves.
Bryan Miller, DASH’s chief operating officer and chief pilot, is a former U.S. Marine Corps pilot who flew many aircraft, directed the operations of aircraft squadrons and served as a test and instructional pilot for the V-22 Osprey. Miller was personally involved in dropping over 100,000 pounds of freight from aircraft. After the military, he continued working in heavy-haul air cargo, aviation consulting and regulatory compliance.
“On the software side,” Ifill said, “we have a pilot-facing application that solves how you plan, automate and perform the air drop operation safely on rails. Most pilots don’t have years and years of experience dropping things in the military — this will guide you through space to the right location for the launch. Behind that is college physics and ballistic calculations to do that on a safe and repeatable basis. The pods know where they’re going before they launch; the guidance is helping you with the one thing you can’t predict, which is wind. You want guidance to help with perturbations you can’t calculate — that’s what gives you the precise landing.”
How precise? Ifill said DASH can repeatedly deliver inside a space about the size of a helipad. That precision turned out to be pivotal for Medwell’s decision to invest.
“Joel pitched us the idea,” Medwell recalled, “and I was thinking, ‘This makes a ton of sense, why hasn’t anyone done this?’ I said, ‘If we put a target on the ground and you hit it, we’ll give you a term sheet.’ Fast-forward a month, I’m in a Cessna Caravan with a parachute strapped to my back, launching three packages. I jumped out of the plane and saw the package fall and hit where it was supposed to hit. We ended up taking a much larger stake than we typically do at seed stage, putting in north of $4 million. We brought on some other people and everyone at the table has a background in different parts of the ecosystem.”
Medwell’s cellphone, stowed in a cargo pod, survived the landing. Miller said that as a rough verbal equivalent for shock load, DASH aims for its packages to encounter no more than about 3 feet per second on touchdown, similar to what a parcel experiences many times during a UPS move. But DASH actually builds its technology and “decelerative profiles” based on energy transfer, a more complex calculation.
(Photo: 8VC. 8VC founding partner Jake Medwell, DASH Systems founder and CEO Joel Ifill, and 8VC investment team member Wesley Friedman.)
What is perhaps most revolutionary about DASH Systems is not the technology itself, which is similar to guided munitions, but the business model unlocked by the technology. One of DASH’s slogans is: “Land the package, not the plane.” By eliminating the landings normally required to deliver cargo, DASH cuts handling times, reduces fuel costs, expands the universe of potential destinations, maximizes asset utilization and ultimately speeds delivery. Landings and takeoffs are fuel-intensive and dangerous. DASH minimizes them.
“We created DASH Systems after realizing that 30% of the cost for delivering cargo or goods to small airports is landing the plane or helicopter,” Ifill said in a statement. “By commercializing precision aerial delivery technology that previously was only available to militaries, we can accurately and safely air-drop cargo into airfields, distribution centers or rooftops all while the plane is still in motion. Our vision is to land the package, not the plane, and provide rapid logistics virtually anywhere in the world.”
In DASH’s model, a single small cargo aircraft can make multiple deliveries on a nonstop route without landing, extending its range and accelerating freight velocity. Even better, DASH will be asset-light. Like a third-party logistics provider, DASH will manage customer relationships, aggregate capacity, match freight and provide visibility.
“We’re a platform play,” Ifill told FreightWaves. “We build the technology and let the aircraft operators do their part. We maintain the relationship on the customer side, including parcel integrators and freight forwarders and people who need logistics. We’re essentially a freight forwarder with a technology component operating in a lane that we own: precision airdrop.”
Ifill founded DASH Systems in 2017 after a particularly rough tropical storm season and did early proof-of-concept work supporting relief efforts for three hurricanes in areas where infrastructure had been damaged. While humanitarian relief work is still a use case for DASH, it probably has the smallest commercial potential of the four major applications that the team is working toward.
Miller explained that the Department of Defense is already a client through the Air Force Special Operations Command, which has engaged with DASH in a multiyear contract to buy the technology and collaborate on tuning it for the military’s precise needs. But DASH won’t be directly involved in military freight moves.
The first major commercial use case is rural next-day delivery, which DASH is testing in Alaska, a market unconnected by roads but that has an existing pool of small aircraft.
“It’s a B2B type of situation,” Miller said. “We take it out to that customer in Alaska, straight from an airport to a grocery, for example, which needs 500 pounds of fresh produce a day, or we work directly with a wholesaler who has 20 or 30 accounts set up. If we can proof it out in someplace like Alaska and it works, it will work anywhere.”
Ifill noted that grocers in Alaska regularly experience 40 to 50% spoilage due to delays caused by bad weather at destination airfields; 82% of the state is not serviced by roads and priority overnight services don’t exist in most of the state.
But perhaps the biggest opportunity DASH sees is plugging into existing parcel integrator networks and creating a much faster channel between widebody jet cargo and final-mile delivery providers. The plan is not for DASH to drop packages on consumers’ front porches but instead to drop pallet-size loads at delivery stations, post offices and other kinds of fulfillment centers where the freight can be deconsolidated and loaded into final-mile delivery vehicles like Sprinter vans.
“We do see a bigger opportunity in commercial delivery and logistics,” Ifill said. “This is B2B technology, less about 5 pounds to your house and more about pallets to the post office, an average package load, but delivered right to the last-mile provider.”
Miller said that Amazon, FedEx and UPS face “terrestrial constraints” that prevent them from offering next-day service to rural America. But by maximizing the load factor of the aircraft, eliminating handling and covering a trucking leg of the network at the speed of a plane, Miller says DASH can cut costs and enhance service levels at the same time.
“What you can expect in the near term is a kind of collaborative evolution between commercial and defense customers,” Miller said. “We’ll be flying our turboprop around Alaska and delivering to government and commercial customers. We’ll spend about a month up there delivering to dozens of customers and demoing to dozens and dozens of operators in that pursuit.”