Hermeus, a Los Angeles-based aerospace startup, has successfully secured $350 million in funding to advance its development of what it claims to be the “fastest unmanned aircraft.” The recent funding round elevates the company’s valuation to $1 billion.
On Tuesday, Hermeus announced it had raised $200 million in equity financing led by Khosla Ventures, with contributions from existing investors including Canaan Partners, Founders Fund, In-Q-Tel, and RTX Ventures. New backers include Cox Enterprises’ venture fund and Destiny Tech100, among others. An additional $150 million came in the form of debt, which co-founder and CEO AJ Piplica says will assist in maintaining control amidst the company’s growing capital structure. He highlighted the benefits of non-dilutive financing to support their hardware production and manufacturing expansion.
This funding surge aligns with a broader trend, where venture capital investment in global defense technology surpassed $9 billion in the past year, as noted by PitchBook. The shift in focus towards defence startups has been substantial, with corporate investment reaching $2 billion across 28 rounds.
Piplica attributes part of Hermeus’ funding success to strategic technological decisions made a few years ago. Originally, the startup focused on developing its own engine but pivoted to collaborate with RTX’s Pratt & Whitney to modify the existing F100 engine for its hypersonic aircraft. This decision accelerated Hermeus’ development, enabling faster testing and iteration while securing U.S. government contracts. The company has broadened its ambitions beyond building a Mach 5 aircraft to include diverse projects, enhancing its alignment with immediate defence needs.
Recently, Hermeus successfully conducted a test flight of a technology demonstrator comparable in size to an F-16 fighter jet, with plans for the next model to achieve supersonic speeds. A third aircraft is also in development. This rapid prototyping approach is uncommon in the aviation sector, with Piplica drawing parallels to SpaceX’s iterative model of building, testing, and refining.
Hermeus is rapidly expanding its workforce, nearing 300 employees, but faces challenges in talent acquisition due to the unique nature of their ambitious projects. Piplica stressed the importance of embracing failure as part of the learning process, indicating that managing risks wisely is crucial for progression.
Hermeus is positioned to innovate quickly within the defence sector, having already achieved two successful test flights, and is committed to continuous development despite potential setbacks. The recent funding is poised to enhance their capacity to meet demands while navigating the complexities of aircraft production.
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