Deal focus: Australia’s Propeller reaches new heights

When approaching a theme as broad as industrial modernization, sometimes investors have to start by breaking it down into its simplest conceptual streams. From this perspective, one of the most obvious but overlooked trends is that the digitization of office work has far exceeded that of the outdoor business world. 

Blackbird Ventures is keeping this in mind as it leads a $10 million Series A round for Propeller Aero, an Australian software provider that focuses on analyzing data from drones in heavy civil and resources industries. The deal extends a string of industrial-focused investments by the firm that acknowledge the information age has finally found its way into mines, farms, landfills, and sundry construction sites.    

“Over the last year, there’s been a remarkable ripening of the market in the combination of cheap but very advanced drones from DJI, regulatory environments changing such that workers don’t need a drone pilot’s license, and computer vision really helping to automate industrial worksites” says Niki Scevak, a partner at Blackbird. “Industries that hadn’t been touched by the internet before are now starting to be able to run businesses in a much more efficient way with software.”

Blackbird first invested the company in 2015 under its Startmate accelerator program, having known the founders from a prior start-up. Sequoia Capital China came into the latest round, joining existing backers Accel Partners, Costanoa Ventures, and Australian angel investor Rayn Ong. The investment and a partnership with DJI, China’s leading drone maker, are aimed at development of the current product suite as well as scaling up globally, including a strong focus on the US.

Current products focus on cloud-based software for analyzing aerial data sets, including 3D images, that are said to result in fewer disputes and mistakes as well as lower reporting overheads. A hardware offering called Aeropoints allows worksites to set up easily portable solar-powered sensor arrays that improve survey accuracy. Operations are further supported by a distribution partnership with US drone and GPS specialist Trimble.

Recent progress includes a rapid expansion of the global customer base, primarily in the US, and what Scavak calls some of the fastest revenue growth seen to date in the Blackbird portfolio. It is hoped the momentum can be maintained by building out the sales and marketing team. Strategic partnerships will also continue to play a major role. In November, Propeller opened a US office in Denver, which is also headquarters for Trimble. 

“Silicon Valley has reached this equation where – even though it is the best place in the world for start-ups – the price you pay has gotten really out of whack,” says Scavak. “The people that you can hire there have gotten really expensive and they don’t always stick around, so where the default was to go to San Francisco, now it might be to go to cities like Denver, Portland, and Austin.”

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• Topics
• Australasia
• Technology
• Early-stage
• Australia
• Blackbird Ventures
• TMT
• Sequoia Capital
• Accel Partners