In a world where startup unicorns struggle to raise funds at higher valuations, the drone delivery startup Zipline is bucking the trend.
The San Francisco-based company is raising $330 million in a new funding round, with the funding values now sitting at approximately $4.2 billion. This valuation surpasses that of any other drone delivery company globally and makes Zipline the most valuable drone firm in the United States.
According to one source, the filing included a Series F-1 extension of up to $20 million that could still be rolled into the round, meaning the exact total raised by Zipline could still fluctuate.
Past investors, including Sequoia Capital, Andreessen Horowitz, Katalyst Ventures, GV Management Co., Pactolus Ventures, Emerging Capital Partners and Reinvent Capital, declined to comment. The cash injection comes as Zipline announces a new autonomous drone — the Platform 2 — that can carry 8 pounds of cargo at a range of 10 miles. Zipline’s origins date to Romotive, a robotics toy startup that launched in 2011 as part of former Zappos CEO Tony Hsieh’s Downtown Project in Las Vegas. With the new funding, Zipline has raised over $900 million to date, according to PitchBook data.
For Zipline, the focus has always been on the service, not necessarily the drones. While the technology is impressive, it is merely a tool used in the company's mission to improve global health outcomes. By keeping this in mind, Zipline has been able to expand its reach and impact without becoming distracted by the hype and excitement surrounding the drone industry.
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As Zipline Co-Founder and CEO Keller Rinaudo Cliffton explained, "Our motto is fewer drones, more service. We don't want to build more drones than necessary. We want to build the right number of drones to do the job we need to do, and then we want to be able to use those drones as efficiently as possible to serve as many people as possible."
This approach has served Zipline well and allowed the company to quickly scale up and expand its operations in response to the COVID-19 pandemic. In the U.S., Zipline partnered with Novant Health to deliver personal protective equipment and COVID-19 test kits to remote communities in North Carolina. Meanwhile, in Ghana, the company delivered COVID-19 vaccines to hard-to-reach areas.
Own A Stake in High-Growth Startups
While Zipline is closed to everyday investors, thanks to changes in federal law, anyone can invest in these types of high-growth startups at their earliest stages. StartEngine, for example, allows anyone to invest in startups for as little as $100 in some cases. For a limited time, investors can invest in StartEngine itself. While startup investing is risky, and most fail, the winners like Zipline show what’s possible. Zipline went through TechStars, a reputable Seattle-based accelerator. The program has average deal terms of $118,000 for 7-10% equity, putting the valuation of Zipline during their first round at roughly $1.2 – $1.7 million. This means Zipline’s earliest investors are sitting on unrealized gains of roughly 276,000%.
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