INNOVATION & START-UP
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The Next Big Thing

China's high-flying drone maker DJI sees further big sales after talk of US$10 billion valuation

PUBLISHED : Monday, 20 April, 2015, 4:14pm
UPDATED : Monday, 01 June, 2015, 12:00pm

DJI, the Chinese maker of remote-controlled quadcopters that have been at the forefront of the consumer drone craze, sees sales growing at least three times this year over the last as lower-cost technology makes the devices more affordable.

The Shenzhen-based company, which came to public notice after a user of one of its drones crashed it on the lawn of the White House, triggering a security scare, is also reportedly looking to raise hundreds of millions of dollars in venture funding at a valuation of US$10 billion, making it one of the world’s most valuable start-ups. It has a 70 per cent share of the global civilian drone market.

“We have grown three to five times year-on-year in terms of revenue, and that trend ran from 2009 until last year. We are very optimistic of the continuation of the growth,” company spokesman Michael Perry said.

“International competition in the drone market is increasing, but DJI is uniquely positioned because of our history of developing stable flight controllers,” he said. “No other company has been able to match our combination of accessibility, affordability and reliable performance,” he said.

Perry said that the company was not ready to make any announcement on the funding reports.

Demand is growing for drones to monitor public safety, shoot film footage and search disaster areas, but businesses are also using the technology in new ways, including farming, firefighting, real estate and archaeology. One of the patents that the firm has applied for shows it planning to use drones to help clean building exteriors, according to China’s patent office.

Chinese rock star Wang Feng also made headlines in February when he used a DJI drone to deliver a ring to actress Zhang Ziyi in a wedding proposal.

The company has also launched programmes asking people to come up with creative usages, Perry said. It has also released software development kits to specific industries, including package delivery, power utility inspection, mining and sports.

DJI, founded in 2006, now has about 2,800 employees, including in Beijing and Los Angeles, and is worth much more than the 10 billion yuan (US$1.6 billion) valuation it received last year, chief executive Frank Wang told Bloomberg this year.

Its Phantom range of camera-bearing drones has become the market leader in part thanks to hundreds of videos on social networking sites such as YouTube showing off the devices’ high-definition aerial photographs.

New models would focus on improving flight times and the sensors on its cameras so it can take in more types of information, he said.

The company is also looking at improving safety mechanisms, Perry said, after a series of high-profile incidents involving civilian drones around the world highlighted a lack of safety awareness among ordinary consumers.

“There are a lot of people who are just entering the hobby who may not know how to set the equipment properly. There’s clearly a need for stronger education,” Perry said.

DJI is working with the US and Chinese governments on rules for commercial and recreational uses of the devices. The company has already said it would release a firmware update for its drones that would prevent them from flying inside Washington DC’s restricted airspace and from crossing national borders.

According to mainland regulations, it is forbidden to fly drones within the 5th ring road of Beijing. The entire Xinjiang region also bans the technology. The rules also say that unmanned aircraft are forbidden from flying higher than 120 metres and must stay within 500 metres of the controller. Anyone flying a drone heavier than 7 kg must have a licence.

New rules will be drafted this year for civilian drones, according to the Civil Aviation Administration of China.

In the US, the Federal Aviation Administration is currently working on controls to govern the commercial use of small drones.