So far in the Drone Disruptors series, we’ve taken a look at two distinctly different players in the drone delivery space. Israel-based Flytrex hopes to become the drone of the U.S. suburbs, flying over residential neighborhoods and airdropping cups of coffee to your backyard. Then there’s Volansi, headquartered in the Bay Area, a company seeking to fly in more remote areas – including over the ocean.
But for this week’s installment, we sat down with a company that wants to bring drones to the least remote places in the world: cities.
“We want to show how drone city networks work,” Andreas Raptopoulos, co-founder and CEO of Silicon Valley-based Matternet, told Modern Shipper. “Our vision is that a city like San Diego or San Francisco or Miami or Berlin or London should use drone delivery as one critical piece of infrastructure.”
Raptopoulos envisions a citywide drone nervous system, with drones flying above the streets between urban nodes from which they can send and receive packages. In this week’s edition of Drone Disruptors, Modern Shipper sat down with Raptopoulos to talk health care, traffic and integration.
Drones on the skyline
Cities have come a long way from the horse-and-buggy days of old, building out complex ground and rail networks. But as e-commerce puts more and more products into circulation, Raptopoulos fears cities becoming congested to the point of being unlivable – which is where drones come in.
“Imagine how many cars you could lift off the road if you were able to replace DoorDash or Uber Eats with drone delivery,” he said. “As e-commerce becomes more on-demand, there’s probably no capacity on the road to fulfill that demand. You need this other sort of third layer of transportation that doesn’t push by the road.”
While Raptopoulos says Matternet may eventually move toward home delivery, the company’s current focus is on the urban side. Matternet hones in on the lightweight category, specializing in payloads below 4.5 pounds, which Raptopoulos says account for about 85% of e-commerce shipments.
But before Matternet was flying in urban environments, it was in places that could be considered anything but. Matternet got its start conducting humanitarian missions in the rural regions of countries like Papua New Guinea and Bhutan, delivering medical supplies, blood samples and other health care products. It was the company’s success in those places that allowed it to obtain the resources to pursue its ultimate goal.
“Matternet is a company that was founded on the vision that drone delivery was going to change how the world works,” Raptopoulos said.
A drone nervous system
Matternet’s drones are custom-built to operate in urban environments. Lightweight and compact, they’re designed to carry 4.5 pounds or one gallon over a distance of around 14 miles, but Matternet’s product goes far beyond the drones themselves.
“We have an end-to-end solution that is integrated,” Raptopoulos explained. “So we build not only the aircraft that flies, we also build the way it’s combined and controlled in the airspace, how it’s monitored and then how we land.”
As Raptopoulos puts it, Matternet is exactly what it says it is: a network for matter. His vision is to bring not just drones to cities, but also 50 to 100 nodes from which they can send and receive packages, as well as a way to monitor their movement between the skyscrapers.
Matternet Stations, which can be used to send packages all day every day and are equipped with automated payload and battery exchange, would function as the nodes of the nervous system. Meanwhile, operators can use the brain of the system, the Matternet Cloud Platform, to field customer requests, generate routes and monitor and control the drones.
That sort of end-to-end solution, Raptopoulos says, will help the company meet current and future aviation safety standards because it gives Matternet control and visibility over the entire aerial infrastructure. But that’s only one of the aspects that sets Matternet apart.
“The second key differentiator is that we are probably the most advanced in the world right now in central operations in urban environments,” Raptopoulos said. “And these were built on another key differentiator, the third one, which is that we’re one of the most advanced – or the most advanced – in our class in regulatory approvals.”
Matternet has been operating beyond the visual line of sight (BVLOS) in Lugano and Zurich, Switzerland, since 2017, and the company moved into the U.S. in 2019 when it partnered with UPS to deliver blood samples. Today, it’s completed more than 10,000 BVLOS flights in cities across North America, Europe, East Asia and now the Middle East, where just this week it established the world’s first citywide medical drone network in Abu Dhabi.
Startups aren’t stopping
To many, it may seem like the deck is stacked against a company like Matternet that lacks the massive size of a company like Amazon. But according to Raptopoulos, startups have a few distinct advantages over the big players that he believes will allow companies that didn’t exist 10 or 15 years ago to dominate the drone delivery space.
“If you think about a company like Google, when they roll out a program, like their own delivery program, they have to balance the benefits of that program on the corporate level with the risk that they have to undertake, given the fact that their main line of business is something completely different. And it has to make sure that it’s shielded and it’s not threatening their main line of business,” he explained.
Raptopoulos astutely points out that startups have a greater capacity to take risks, but what about the capacity to fund those risk-taking ventures? Well, that shouldn’t be an issue either.
“I think the ecosystem around startups can demonstrate that they are leaders in a space that is a huge market,” he asserts. “The investment ecosystem around them is very, very strong. So fundamentally, once you’re able to prove that you have a path to scale, then access to capital is not actually a limiting factor.”
One industry he thinks startups should focus on is health care, where he envisions drones holding the essential function of reducing delivery times for time-sensitive shipments like vaccines and other treatments. That’s where Matternet found its niche, and Raptopoulos believes that drone startups can revolutionize the sector.
“With drone delivery you can actually centralize a lot of that inventory,” he explained. “This type of centralization of labs and inventory will lead to massive savings for health care, and the health care system is going to become way more efficient.”
Already, Matternet has demonstrated the potential for medical drone delivery networks in rural regions around the world. Those places, mostly in developing countries, tend to have looser regulations that allow drones to scale quickly, but Raptopoulos thinks that drone delivery networks in U.S. cities are closer than you think.
“As they say, the future is here, but it’s not equally distributed. So we’re going to see these types of systems scaling in some parts of the world more than others,” he said. “My sense is that I think we’re going to see health care applications in the U.S. scaling in the next two to three years, and probably towards the later part of the decade we’re going to see scaling into e-commerce.”