The Vertical Space
The Vertical Space is a podcast at the intersection of technology and flight, featuring deep dives with innovators, early adopters, and industry leaders.
We talk about the radical impact that technology is creating as it disrupts flight, enabling new ways to access the vertical space to improve our lives - from small drones to large aircraft. Our guests are operators and innovators across the value chain: airframers, technologists, data and service providers, as well as end users.
The Vertical Space
#87 Arnaud Thiercelin, Orqa: Cutting through the gimmicks and winning the drone marathon
In this episode, we sit down with Arnaud Thiercelin, Chief Product Officer at Orqa, for a bold and eye-opening conversation about the present and future of drones and mobile robotics. Arnaud challenges the status quo, urging listeners to think beyond gimmicks and focus on delivering real value to end users. From FPV drones neutralizing M1 Abrams tanks to the West’s struggle to produce a viable DJI competitor, he doesn’t shy away from controversy. He calls out the industry's missteps and offers sharp insights into what it will take to reclaim leadership in drone and robotics innovation.
Beyond military applications, this episode explores the broader implications of mobile robotics across commercial markets. Arnaud discusses the critical gaps in the Western drone supply chain, the challenges of building a defensible company, and the next major competitive battleground in drone technology. He also shares his vision for integrating drones into enterprise ecosystems and the rapid expansion of drone use cases.
I think the number one is going to be reliability. And at this point, this is the thing that is surprising people, but as the number one reason when you ask people"Why do you buy DJI?", it's because it just works. Reliability is the biggest problem, it's the thing that takes you a lot of time, it's very difficult to actually unpack. You need to really know how to test and grill your hardware to be able to make this stuff as efficient and cost effective as possible. Number one. The second is going to be openness because everybody got to understand that any robot that you build out there is the beginning of a story. It's not the story. It's the beginning of a story. Like, you build the Boston Dynamics Spot, no one cares that it's actually walking. What people care is that what the walking enables it to do.
Jim:Hey, welcome back to The Vertical Space and a great discussion with Arnaud Thiercelin, Chief Product Officer at Orqa. So what makes this conversation unique? It will challenge and awaken many of you who may considers today's state of affairs satisfactory. It challenges a lot of our audience to be more deeply entrenched in building your capabilities to the customer experience versus just having a unique capability. It will change how many of you see the future of warfare and what investments are most important. And it may inspire some of you as you think about the future of drones, their value and the tide of mobile robotics. So as you can tell, I like Arnaud and what he has to contribute in this great conversation. So what makes the episode extra special is that Arnaud has such legitimacy in this discussion. He's not afraid of bold statements, naming names, and controversy. He seems to just want a better world and has a vision for how some of it can happen. I really liked his comment, I see the drone world as the gateway drug to the real thing, which is the mobile robotics revolution that is around the corner. So he shares a lot about what future that may be, it's use cases and the size of that opportunity. He discusses the precarious position we find ourselves here in the United States, both commercially and with the military. And as an example, he describes how an FPV or first person view drone can find an M1 Abrams weakest point, apply a 10 pound explosive charge, and realize mobility kill. And that this technology is now completely changing the dynamic from a very few expensive pieces of technology like the M1 Abram to a lot of cheap pieces of technology that now give you dominance. And listen to what we all want to know about. What gives DJI its dominance in the market? And how can the West realistically build a competitive alternative. And more importantly, why haven't we seen a DJI alternative come up in the West? Fabulous answers to these questions. Listen to this statement that I think just tells us so much It's just that the west has been systematically building so many gimmicks that we've lost the plot all together We then get into a discussion of FPV and the future of FPVs. We look at the future of the drone industry and what's going to make the difference between and that he believes that the counter UAS advancement is where the real breakouts are going to be. By way of background, Arnaud is an engineering and product veteran with deep experience in drones and mobile robotics. After a time at DJI, where he ran US R& D, he worked at Auterion on the other side of the spectrum, and is now the Chief Product Officer at Orqa, working on FPV drones. So Arnaud thanks for joining us and to our guests enjoy our talk with Arnaud Thiercelin as you innovate in The Vertical Space.
Luka:Arnaud it's a real pleasure to have you on the show. Welcome.
Arnaud:Thank you for having me.
Luka:What is it that very few in the industry agree with you on?
Arnaud:There's I think there's quite a few things, but if I had to put something in the very top is that the U. S. is in a deeper in deeper trouble when it comes to innovating in mobile robotics than it is, and that it needs Europe, to gain the leadership back, especially where the way the geopolitics are landing and the division between Europe and the U. S. is actually going to be very detrimental for the U. S. on that exact front. I would probably say this is the biggest part. I can develop on it if you want as to why, but, and again, I'm coming from the perspective where, I've seen this firsthand, I lived in the U. S. from 2010 till 2022. And, and then I saw, what I used to call, chasing the dragon situation, Silicon Valley, where, your salary is going, but the cost of living and everything around you is going up faster. and you're in a position right now where engineering is just too expensive. And I'm not saying that you just simply cannot afford it in an absolute. It's just that building mobile robotics requires you to be able to have multiple iterations to try to figure out where things are. And, I'm one of the person who will tell you that hardware is not harder than software is just less forgiving. And that's what it is. you need more iterations to get it right or have a crazy level of experience, but in deep tech and things are breakthroughs there's not a lot of people. There's not a lot of experience that exists. So you need these chances to go after this. And the overall cost of each of these iteration is so high in the U S. that now you either get it right in one or two or three shots or you're basically dead or you need to raise absurd amount of money, to actually get it there. What you have in Europe is an alignment in multiple fronts. Number one is culturally speaking. Europeans and Americans are brothers, cousins, will always be the case, even if we're like, you know, point the finger at each other. There's always going to be this alignment in culture and interest in how we see society and how we see right and wrong and all the different things. The second is that Europe has a has a spectrum, where you have a very high level of education at a relatively low cost of living, because the policies over there have kept everything under a certain pressure. But what that means is that if you want to be kicking off and iterating and trying things, it's the perfect ground to do this. And I was already having these conversations way before I was at Orqa or anything like this. When I was still living in the Bay Area, I was in 2019, I was advising companies were figuring out how to do distributed offices because they wanted to be able to tap into this. And it mostly transformed into a bit of a cat and mouse game in the U. S. because at the time, there were still places where you could go where it was more affordable than the Bay Area. But you get into a point where this territory, these pockets of places where you have high talent at a relative low cost, they're disappearing, right? They're getting, fewer and far apart from each other. And now you'll find ourselves in a position where it's very difficult. The cherry on the cake on this is that there is this unintentional war against education as a whole, which has nothing to do with recent events. It has to do with, the monetizations of senior education, right? It's extremely expensive for people to go into senior education, and it's pretty risky. We're back, and you know, the things you probably have heard a thousand times before, you trust an 18 year old with 250, 000 worth of student debt. It might work, it might not work out. And an example that was coming along often was mechanical engineers who were going into very good schools, right? And they go to Stanford, they do great stuff while they're going, and then they land in the market. And they can only get 85, 000 of salary because mechanical engineering is this, you know, not a lot of interest for this. Well, they go back and talk to their friends and to the next generation. And they're like, what have I done to myself? They go online. They talk about this whole thing. And so you have a progressive, erosion of the, appreciation for senior education. So you have less and less, engineers and the cherry on the cake again at the very top right now, which is an accelerating is, and there's, I'm starting to dive into this specific topic because there's people who actually start putting papers about it is that the whole thing with AI is creating a new wave of abstraction. And so knowing how things are being done is getting further and further apart because most people now rely into an AI to be able to learn how to do things. So you don't need to learn. You don't need to actually go through the painful process of learning and memorizing the skillset that you need to have. You can just trust in some AI. Now, this is not new about AI, right? There's a lot of different things. Almost a decade ago, I had a conversation with a friend that was at Apple. He was complaining that people were having difficulty, finding kernel engineer to do memory scheduling, which is a complicated thing that needs to do. And the reason was because everybody wanted to do mobile apps. Everybody wants to do web apps. Do you have this, it's a long term trend that is going, but that lands you there, where if you really want to have the means to do all these iterations, Europe is the best place for you to do. It's not the only place, but that's the best one.
Luka:What do you think is a valid counter argument by a U. S. drone company that is not necessarily based in expensive California, but elsewhere in the country close to good colleges, good talent?
Arnaud:So this is a huge topic. And because I spent a lot of time diving into, the world wide dynamisms and potential places and when there's skills and where there's not skills and where the strengths are another strength. I can tell you that there's a lot more to it, but I'm going to try to keep it condensed. My, my take on this is. Silicon Valley has one absolutely ubiquitous and universal power that every other places in the world, including in the U. S., is trying to achieve but struggles, which is that it's a, it's an echo chamber of mindset and innovation and optimism, or at least it was when I was there. It was kind of dying off. A lot of people were leaving and I don't really know where it is right now. I hope it is, but some of my friends who are still living there, they're a little bit more negative than it used to be. Different topic, but regardless, when you evolve in this environment and you have similar dynamic when you go in places like Shenzhen, when it comes to hardware development, a thousand things, that would be a conversation end up being a no brainer. Everybody is already in tuned on these positions, right? You don't even need to discuss about this stuff. And your language that you use, it may be English, but you're not having the same meaning behind the words because you're already in tuned with a lot of what these meanings are supposed to be. There's a lot of rules of how things has to be done that are already accepted because everybody has 10 friends who have had a startup, we've done something and they already know that this is going to work and not going to work. And that is the thing that really accelerated everything and made Silicon Valley so powerful. It's call it a network effect or anything like this, but I think it's more that it was the place you were to come in if you wanted to make something big to happen and you were surrounded by people who wanted to actually do the same thing. The remote work has exploded this and created a door of opportunity where people like me, transplants, were like, I'm in the UK here for family reasons, right? But I am now an influence and I'm bringing a lot of that stuff of all the people who are around me and touching me because I embodied this culture and I have it with me, but I do have to have, this conversation and this fight and this constant reminder that what it is. And I'm surrounded with brilliant people, brilliant engineers who know what they're doing. And I know that if I'm going to the London tech scene, as I was, I don't see these things. They don't get a lot of these aspects. And if you go into New York city and I went and I sat down with a bunch of VCs a few years back. They will tell me the exact same thing that the cost is high, but that kind of like culture, that little special secret sauce is not really there. And this is the part that is hard to actually characterize and quantify. But that's the thing that probably has the biggest impact on your ability to actually build things. Because it's not so much about I'm a great electrical engineer and I had 4. 0 GPA everywhere and I was doing. This is not the measure of being a good engineer. The measure of being a good engineer is how these iterations that are going to be developed are going to be efficient. Right. How much of the things you're actually going to have to try to test and validate and how many things and a lot of these decisions, if you want to have a pure logical approach to them and data driven output, this is fundamentally a point of insecurity. And that's not a popular take what I'm saying right now, but that's the truth. The teams who are really flying and going fast are making a lot of bold decisions in the light of incomplete or drastically missing elements. And they're just still winning and hitting it right. And this is really where things are going. And when you see stuff like, my time at DJI was like this. The guys were just flying through the problems and they were building hardware like, like the West was building software. And if you were to ask a stupid question, they would look at you funny because it was unheard of. You would really stand out because there are so many of these meanings and things in purely engineering. It's not the language. That we're just accept it. That's the way it is. That's how it goes. It's how it works. And I asked my share of stupid questions in my way of learning there. But that's really what you have. It's not just about going where it's cheap. It's about going where you're going to find that mindset, that mentality. And I don't have a way to actually give you a set of questions to gauge it, but I do read it and detect it when I'm asking and people throughout a conversation. And I call it like a maturity level. And I think that Silicon Valley really got at the peak maturity of it. In terms of that pure technological things. Silicon Valley problems are somewhere else at this point. But that's really what you would have. So, yeah, you can take a bunch of guys and move them into Kentucky and do something good over there. But you're gonna lose that echo chamber, you're gonna lose that things and that's gonna slow you down and you're not gonna realize that you're being slowed down.
Peter:You're touching on two drivers of this. One is specific to a geography. So let's say, okay, the cost structure of living in Silicon Valley or taking the risk of being an entrepreneur there, and you argue that, that high cost exists in the other clusters in the United States where you're going to find the high skilled people. And in addition, those people spent a lot on their education. And then the other driver that you're, laying out here is that hardware is unforgiving. And I would say what makes a great engineer is not just education. But it's experience and experience is gained through iterations. And you need a place where you can afford to do a lot of iterations to take an educated engineer and turn them into an experienced engineer, which is a really good one. And then you put a cluster of those together. Then you build this mentality that you point out exists or existed in Silicon Valley. But I think that a big piece of what built Silicon Valley was fast iteration type work principally in software, but we're looking at a new frontier of software deeply intertwined with hardware. And so that's a global factor, right? That's just where the technological frontier is right now. And then with AI, I we see a lot of startups making a foray into new development tools that would change an engineering workflow for how you design hardware or a complex system that involves hardware and start to give you the type of abstraction away from the base level, shape of the parts, up to higher levels of abstraction, like what we've seen over the last 50 years in software development. But if you have a generation of engineers that haven't had access to the iterations to build the experience and then they're using tools that abstract them away from the equivalent of the machine code, then where do we end up?
Arnaud:That's the, you're diving into the very scary part of things. And, and this is the part where I'm super fortunate about the journey that I had because I got it, I got to work with people who got me into the weeds or the details of it. And I am, I'm also, I'm a sweet spot of age, right? I'm an elderly millennial and I say that we're the generation that build the modern internet and we got into a lot of the details, but I know that I work with guys who are like in their twenties sometimes 25 and sometimes 28 and they use Slack and they don't really know how to use it. And I think like, my God, we have to train you on how to do these things. And I'm not saying this is a negative way. I'm saying that we have created such a modern technological world. That they don't really know how to deal with these things. And me, when I use Slack, it feels like I'm back into an IRC client just with like an extra skin on it. But I know how to use the commands because, in the late nineties or early 2000, I was using it and we were using and writing bots on it and things like this. So I have this exposure to this whole thing. And on the hardware side, I think what you got going on in, in Shenzhen for instance, is that they have this exposure to this hardware kind of thing. And I think the west and what you see in the US is, we'll give you a 3D printer and a go get it attitude. And then you're just going to start building stuff like that. But there's a lot more to it that you're super not exposed to. And you find that people are, they just don't even know what to ask. It's a very deep case where they don't know what they don't know. And you're right. On the drone side of the robotics side of things, we're still at this stage right now where we're solidifying the availability of the hardware. And everybody screamed at the commoditization of the hardware way too soon. And it might be coming at some point, but it's super not there. And it's super not there specifically because to be building these complex machines, it's not the same as building a regular PC. It's not the same as building any of these things. There's a lot that goes into it. And this is what attracted me to it. Because software is something that, I'm pretty good at, and I've done a lot of work on different side of things. But it's getting pretty much redundant, and what I love about robotics is that it kicks your ass like crazy. But the satisfaction you get when you get something on the other side is the best. But you gotta work with people who are material, specialists. Mechanical engineer specialists. You work with things that are on the various manufacturing, capabilities that are directly shaping what your product is going to be and what it can actually perform. And you have this entire chain that goes in. But I'm looking back at this and thinking like, who the hell in Silicon Valley has actually been exposed to this deep level of understanding about these kinds of processes and work like this. And I mean, like, even you go around to the hardware people and you ask them, like, how many of you are actually, quality checking the plastics that come in before you actually mold them, and they'll tell you, like, you, you're supposed to check the plastics. I didn't know. You could be wrong when it comes in. And then there's a lot of things like this, that, but it's not very sexy, right? And anything, you put yourself as an engineer, like you want to have the best possible career. The cost of living is pretty high, so you go after the jobs are going to be paying you very well, and the jobs are going to pay you very well, they're not trying to be solving the foundational problems, and that's why I personally I'm very skeptical of a private sector coming in and fundamentally changing this. I don't think you can throw money at the problem. Because the longer we've waited to address this whole thing, now we require sustained commitment and belief in creating this thing. You need to, I don't want to use like something, but you need a similar situation that creates Silicon Valley in the first place. You need a sustained investment and enforcement if you wanted to bring this stuff back in Silicon Valley, but that's also the opportunity to ask yourself how you should be doing these things. In the short term, if you want to need to have something right now, Europe, unfortunately, is still like, unfortunately, I mean, I think it's a great fortunately, but For those who are very much believing in an American solution to an American problem, Europe is the solution.
Jim:Arnaud this is terrific. Who cares? So you just outlined that the United States is going to be significantly behind Europe and significantly behind others. What's the big deal, both on the military side and the commercial side? What's the result of this area that you think a lot of people don't agree with you on?
Arnaud:So, let's talk about military and keep something in mind. I'm not a military guy. I'm learning and I just get to talk to great people who are educating me on all sorts of things. The military tactics aspect of things, which, I'm rationalizing, but I have zero first hand experience. And in the commercial side, I do have a lot of exposure to it. So, the military side of things is you get to look into what has been going on around the world. Now, Ukraine is the thing that really steals the show, but you got a lot more of what's happening. And what you really have happening is you have groups small and bigger who are now emboldened because they figured out that they have a new way of getting an edge against traditional large militaries like the U S right? So the Houthis and what they're doing in Yemen and disrupting traffic, et cetera. And then, it's not like the U S is not present and other armies on present and trying to do something about it. It's just that this technology that they now have their hands on, the drones that provided by Iran, from what I understand, again, not an expert they have access to this and that allows them to establish the disruptions that comes in. When the Taliban took over Afghanistan, I was reading on the media that they had this unit of drone assassins that were using these targeted things and they got these drones together. This is why they had this capability and this ability to go in. Now, there's all the stuff that you saw in Ukraine, but there's also the stories about Azerbaijan. And it's been going on and on like this forever. I personally, I'm surprised it took this long to become this prevalent, because a lot of the things that I'm seeing right now being deployed, are, I'm like, oh, okay, we're reinventing all this technology that we had six, seven years ago. Now they just found themselves into the military. What's happening? I'm not particularly happy about it, but it's you know, I'm also practical and pragmatic about it Now what you see in Ukraine is very simple It's just that you can take the best piece of technology that you have out there, right? You take I don't even know what's the best but you take an M1 abrams and you put it out there An fpv drone is going to find its weakest point. It's going to apply say a 10 pound explosive charge exactly where it hurts where it creates a mobility kill And that's what you got to do. And you can make this M1 Abrams like 20 million more expensive. And sure, they'll bring three more FPVs, right? So instead of a thousand dollars into the table, they're bringing 3, 000 into the table, and that's why it actually matters is because this technology now is completely changing the dynamic from a few very expensive piece of technology that give you dominance to a lot of cheap pieces of technology that give you dominance. And if you don't have this ability to pivot, and that's one hell of a pivot mentally, psychologically, it's a pivot in every single concept that you had everywhere. I'm looking at this from an engineering and a product perspective. And I'm looking at it like, wow, imagine I had, imagine I was Amazon, right? And I was doing like package after one another into robots. And I realized that no one cares about this tomorrow. And I have to be doing hand stuff made like I'm Chanel and I'm doing like haute couture stuff. Do you imagine if Jeff Bezos has to be wrapping around, like, 30 years of what I'm doing and actually don't work? That's what's going on, right? that's what's going on. But, so that's on the military side. But on the commercial side, I'm going to get back into some of the things. I often say this to people, that one of the things that I heard that shocked me the most, if not the most, in my time at DJI, was when civil engineers were approaching me, alarmed by the state of, the, civilian infrastructure. And they used to say to me that this, they'd say like, we have built so much and we have so little people to monitor this that our current plan and only plan is to let it crumble and build it again, right? And you see this every day. You see this with the wildfires that happened in California when I was still living there. You see this with like floods. And I remember in 2018, I was in Guangzhou and I was talking about this. And like a few weeks later, I got a guy from DJI who tells me like, Hey man, you just spoke about penstock blowing up in water dams and check out what just happened in Brazil, where one of the dams just broke out because there was this crack in the concrete that no one caught up early enough. And so the whole thing blew up. And so that's really what you have. You have a limited access to labor that you have to make it count. Now, when I'm saying limited access to labor, most people, they see like, all right, let's get humanoid robots to go around and poke at things, but there's a ton of work to be done before you get into it. And the first thing to do is understanding the state of what's going on. Right now, you can basically take the western half of the US, and the majority of utility companies are in a range of not being able to tell you what the state of their asset is, or having a fuzzy vision of what the state of asset is when it comes to electrical power lines, and that means that with all the wildfires that are coming in, they're having difficult conversations with insurers who are basically telling them that I'm not going to be like, insuring you at the terms we have right now, unless you can guarantee to me that you have a full understanding of the state of your assets. And for them, they're going like, okay, so I have now, I don't know how many millions of poles, how many thousands of miles of cables going around, et cetera. And I've got to be able to have visibility on all these things going on. They can't hire 20, 000 guys and then having them going around and taking pictures and collecting and processing this information. And this is where robotics comes in. It allows you to be creating an operation and processing this information and this is why it really, really, really, really matters. And particularly for the West, particularly for countries who have a problem with birth rates, but particularly for countries who have an aging infrastructure. I mean, in here, in England, my wife is complaining often about the fact that there's constructions on the roads all the time. And I tell her, you better get used to it because everything underneath your feet is 60 or 80 years old. Right. And then when it's breaking, they have no idea where it's breaking. So they dig a little bit, they see if it was a problem, block the road, close it in, they dig a little bit. You know, none of that stuff was built with IOT or anything like this. Maybe you have a sensor, every five, 10 kilometers away, right? For to figure out that this is in that segment. But that's the state where it is and that's why for me, mobile robotics is the next frontier, is because it is the only way we create the scalable solution to the scale of the problem we have.
Luka:Another easy question. Let's talk about DJI and its dominance in the drone industry and the iron grip that they have on the supply chain. How can the West realistically build a competitive alternative? And more importantly, why haven't we seen a DJI alternative come up yet in the West?
Arnaud:Okay. So that's that. Okay. So another huge topic, DJI doesn't have an iron grip on the supply chain. DJI has a leadership team that does not back out to a difficult challenge. And so when any product needed to have something specifically done, there was no weaseling out. And I used to say this when I was a DJI if Frank Wang was the star of the movie 147 Hours, the guy who lost his arm in the rock, the movie would be called 35 seconds and a half. Because he would be cutting his arm to be getting the things going in a heartbeat if the product, and there's lots of stories that I can't talk about, where he would actually doing this whole thing. So if you needed a capability, you were just building it in house and the timing and the way DJI was built and the kind of funding support and the geopolitical timing was such that DJI always had the means to be going after their ambition, but it's also because, who is going to be finding it sexy to be building a factory that's going to be cutting molds for injection molding so that you have the full control of your supply chain, right? I mean, good luck pitching that stuff to, to, to Sand Hill Road, right? And, and especially when the guys before you is selling you AI on large language model and the guy after you is saying the same thing. You're not the sexy pitch around, but that's really what, what is going on. But more importantly, DJI is a tiny company in the landscape of China, right? They're like, they're very visible and representative of what's going on. But there's many other drone companies in China who are doing all sorts of things. And I actually like today to refer to DJI as a lifestyle company because this is what they do, right? They do bikes. They do stuff. You have a good time. You film yourself. For me, there would be the perfect acquisition for Apple to find a rebirth in what they're doing because this is the exact same narrative. Like, you know, how you have my phone. I take picture of my family, et cetera. DJI takes all that stuff outdoors and makes it fun. So why people haven't been making a DJI is what I want to get into is I really hope people don't try to make another DJI because DJI is not the best product they can have is the least worst product they can have. It's just that the West has been systematically building so many gimmicks that we've lost the plot altogether, right? Because a Mavic is not designed for defense whatsoever, but they happen to be there because everything else is garbage, right? The M300 even is a good and well built drone because DJI's engineering is just that good. They're just the pick of the litter. Like the stories in Shenzhen was that there's 100 people waiting to replace you in the engineering team if you're not happy with what goes on at DJI. And when in my office we were recruiting people and we're doing career fair, we had to tell the students that If you don't have 4. 0 GPA, we're just not even going to consider you because the pile is already too big. Right? So the engineering over there is insane. It's the product direction is in my opinion, not the one that's going to win an enterprise. And I'm saying this with a lot of love for things that they've done, like the DJI RC plus I think it's the epitome of the ground control experience that has been done. But so the West, why aren't they doing things? Because they're just building weird gimmicks all the time. Skydio got completely obsessed about autonomy at a time that no one was asking the problem of autonomy. Did they bother themselves to actually go and see, those who are using them? I guess not. Because they would have told them that they're not gonna rely on autonomy. They're going to rely on standardized operating procedures who are going to keep the drone away from the assets. And then they will do a pep talk with one partner and around an oil and gas station. And they'll say like, Skydio you're super safe. I can fly it next to an oil and gas setup and everything. And me, I'm looking at this, like everybody that I spoke to on this industry, they won't even let you fly until they have vetted the thing because they're not going to take a chance that autonomy doesn't work and it crashes on an oil tank and it creates a catastrophic problem, etc. These industries have such a relationship with safety that is foreign to Silicon Valley that it's very hard for them to wrap their head around the fact that you're not going to just spritzle a little bit of technology on top of it and get these people to just giving you a blanket, rubber stamping and moving on. But there's other companies, and I really don't want to make it like a, bad mouthing on everyone, But I'm going to go another one, like Impossible Aerospace, nice people and everything like this, et cetera. But it was a flying battery, right? Who the hell asked for a flying battery? And it was being like a drone that was flying more than an hour in the air. So ITAR export control right out of the bat. So there you go, you cut yourself from the rest of the market that you would have internationally. And more importantly, you went after public safety. Public safety, they fly eight hours a day, right? If not 12 hours a day. And then what's your solution for them once your welded soldered battery into the drone is running dry and you have to charge it. No, what they want is replaceable battery so they can fly again and again and again and again. Like, so another one, another, this is why the West keeps breaking is, and my understanding is that this was the way to raise money back then. Like, you couldn't go around and go after DJI, but the solution was never to go after DJI. DJI, the grip that they have is that they mastered so well the consumer experience. And like they're like at the nine, 85, 90 percent point of where it is and their control over their manufacturing future being all in house means that they do not have, to be going around wherever the wind blows means that it will always be able to provide on the consumer level, the best bang for buck.
Luka:Okay, can we drill a little bit deeper as well? I love this line of thinking, but let's elaborate this a little bit more. So what I hear you say is overall, there's a bit of a lack of leadership in the industry in both understanding the customer need, but also plain and simple executing with a great, sense of urgency and innovation. Okay but natural follow up question is why? I mean, there's a lot of talented, smart engineers in the U. S. in the West that are very close to the problem. They're used to solving, pain points across the industry. And, so one argument is that, yeah, maybe there were some other shiny things that smart engineers were pursuing. Maybe they thought the market wasn't good enough. Maybe they thought that another wave was worth riding more, but at the same time, here was DJI showing that this is a meaningfully interesting and sizable market where you can build strong companies. So again, why? Why have we seen that? Why have we seen a focus on gimmicks? Why have we seen, giving up on a vertically integrated model in the West?
Arnaud:In my opinion, the long story short, it's ego. It's the cult of the founder, and everybody had to have a thing that was doing their identity. And then when your flying battery becomes your identity, you don't let that go and understand it was dumb and you have to pivot to something else. Right? When your autonomy is your identity, you completely skip the fact that the camera is what matters. But if you look, like, I like to point this out, Freefly System is the actual example to pay attention to. Right? Because they're the one company who has beaten DJI fair and square on the market, which is cinematography. Right? They're the reason we don't have an M600 anymore. Because they did a great job. And they did a great job by doing what the cinematography, customer wanted to have. They didn't want an Apple esque, experience. They wanted to be able to customize it and modifying it for the shoot, for the shot that was going on and the Alta series did a really great job and you know Tabb when was mentioning this that they build their own batteries a long time ago. He has this battery supply chain nailed down. Why? Because he understood he was mattering to actually provide this stability in this point of clarity to the customer. So and what's Freefly's gimmick, they don't have a gimmick. They just build good drones and they're focusing on building the things like this, they're nailed down and matching their market and just going at it. They're smaller, they're bootstrapped. They're doing a great job. But when you see the things about the Skydio stuff, it's just like the autonomy took over all of the other conversations. And instead of just letting it go or productizing it, like if you're going to be an autonomy company, be an autonomy company and sell that stuff, right? GPS denied is a hot topic. Where is Skydio in GPS denied conversation in the Ukrainians? No, we're just going around after like 3D Scan and all sorts of vertical integrations and things that were actually create a lot of friction for the end user. And I'm not doing this as a diss on Skydio. I'm saying that this is my understanding of why they would just not let go of the functionality or at least move the functionality to the secondary tier and focus on where really things matters because you take the X2 as a drone and you replace that camera. And you actually have a great drone you don't need to do the X-10.
Luka:Okay so, at the same time, the West has had the chance to observe DJI for 10 years. And I get the founder cult, I get the, uh, losing sight of the big picture, but you know, wouldn't there be several, smart founders, engineers who observed what DJI is doing, what the other companies in the West were doing. And then have this light bulb moment of, okay, well, there is a path to do this right?
Arnaud:So I'll tell you this is part, this is the ego at a harder, bigger level. something I've noticed that DJI was that, so me, I, again, I'm French born and raised in France, lived in the U S if it wasn't for this thing, I would still be living in the U S. But I noticed when I was at DJI that my American colleagues were having a difficulty looking at China with a neutral eye. It was very hard for them to just look at the country and just like, let go for a second their problems they have with communism and the party and whatever the hell that they have just come around with a neutral eye and being able to see what's in front of you. And when I used to have conversation when I left DJI, but people are asking me again, they want to have the secret recipe, like it's some sort of encoded things that is passed on. I asked them, have you ever been to Shenzhen? And they tell me, no, I haven't. I said, you should. I said, start by going to Shenzhen, go to Huashan Bay, which is this big open market. And just walk it for a day or two, just let the energy go into your skin and see what's going on and what's happening in there. Right. And then start to see if you can talk to people and imbue the whole thing. What I saw is the opposite is people were already convinced they were right before even trying anything. Right. And I was into a lot of different situation that were, there were comical in nature and a level of arrogance and confidence that they had done everything right. But even if you look into when I was a DJI, there was people who came from the Predator drone program and all this stuff that were, really dissing on what we were doing and thinking like, Oh, but I know better because I was doing a Predator. And I just, how can you not see that there's literally nothing to do between a Predator drone and a Mavic. They're called drones. But that's it. This is the, this is where the similarity is stopping, but they were approaching everything from the momentum of what they had before. And we back into one of what I think is the most difficult thing in technology is that you got to be holding on loosely to your conviction and when you have someone has done something for 10, 15 years and it becomes their identity, et cetera, they just don't let go. And then they're coming around and they have these old practices and complicated things to do things. I don't want to give the name, but I worked for a company for a bit and they were starting to be slapping mil spec connector that were$200 a pop, gold plated, hand manufactured on a drone and it ended up being like 50 percent of the BOM. And I looked at this and I was just losing my mind and I told them, it's like, dude, you would get fired on the spot at DJI. They would think you have a mental problem or something. Because how is it that you cannot, but that's the right connector because they're going to be, no, it's not. It's stopped at the price. Oh yeah, but it's gold plated and mil spec. Timeout. It doesn't work. This is a game of building scale and building costs and everything like this, but this is the right engineering. And I was like, not anymore. And I don't really want to go back into the time where we're performing cards and whatever you have and things, because this time is no longer relevant. Around a beer we can talk that's fine by me, but now, no, we're trying to get, make their actual practical decision.
Peter:I wanted to get back to your assessment of DJI and the decisions that they've made. As you describe it, they've created this Apple like experience and they've really targeted the consumer market and they've grown into a big company with a lot of volume as a result of that. But I'm trying to understand this paradox that despite those achievements they have seemingly made design trade offs that leave us with a closed system, leave us with a system that, doesn't really support some of the enterprise and public safety and defense missions because it's not, you can't get in there and reconfigure it, you can't set up for redundancy. Why is that, right? Just to maybe stretch the analogy, Apple created the Apple experience with, like, the Mac, yet the Mac finds its way into all different industries and all different applications. What is it about drones or robotics that makes that different?
Arnaud:So, I would say to you that what goes on at DJI is the exact same thing that goes on into the West, but on a different perspective. And this was one of the I didn't leave DJI for just a single reason. And I have a lot of affection for the place, etc. it's just that I wanted to see that enterprise potential be real. And their identity is not there. They don't have any reason to go there. They will go there, probably out of a wheel or some reason, I don't know, to prove the world that they can do it. But for me, I told this many times, people, if DJI is not doing it, that's because they don't want to do it. It's not because they can't do it. That's this is it. This is your defense against DJI. On the enterprise side this is what is going on. You're right, you're going to have a moment where you're going to have to use a Phase One camera, which is like, I think is if I remember correctly,$50, 000, it's a hundred megapixel, 150 megapixel camera, and it's going to give you the job done to actually get it correctly. And it will never ever fly in some product managers at DJI because that's just too complicated, too expensive, not going into the volume that's going on. There's a misalignment in terms of expectation what goes on. And that, because again, it goes against the DNA of creating these smaller, cheaper massively accessible system, et cetera. And you really see it at some point where people look at the L1 sensor and they look at some of these things and they're, they want more, they would like it to have it more. Now, because the competition is not really providing you anything else on the sensor quality side of things, they tend to really be on the very top of things and where they tend to fall short is on the data and the control aspect of things because people are trying to create this complex operation and the drone is the beginning of the entire flow. I was talking about this earlier today and discussing about, enterprise operations and how it goes in, right? If you have 10, 000 drones in a company because you've got to be keeping an eye on everything and you have an obligation of delivering on the data quality, you're going to need to have, four or five vendors, people like Thread that I worked with before Orqa, and these people are going to want to be able to have the maximum amount of data and information that the drone can provide, give me more than I actually need to go there. But the developer experience that I worked on, it's one of the best that exists out there, but it's still too narrow and too tight to compare to what the customer actually needs to explore things. They gotta be actively opening doors and preventing more things, et cetera. The M300 is a great drone, but even that, you need to be able to have more modification to it. And these are the things that you, it's gonna be a very hard pitch, if even possible, at DJI. And this is the same, it's like, why would they care? They make something like multiple tens of billions of dollars of revenue a year already. You're gonna come around and you're gonna say like, hey, this is a great thing. It's like, I'm going after the champion and telling him like, you know what? You're the number one, but you could be even more than number one if you're doing this random stuff. And the thing is just like, when you are in this position, everybody is coming to tell you that you would make even more money if you were to X, Y, and Z. But you got your playbook and your track record to tell you that you're on good tracks. Which is also what you have against them if you actually are capable of discovering this. I believe that the consumer market is 10 percent of the enterprise market. I think that this is really out there, but I believe that the enterprise customer, and this is educated, the enterprise customer is extremely demanding. They will be dropping a lot of money on this solution the day they can actually validate that the entire thing is real. And they don't want to just look at the product and how it flies. They want to put them in operation and make sure that it's actually sustainable and working. It's a long and tedious process, but it starts at building the hardware that is giving you all of that information because you can only go as far as the hardware will allow you to.
Peter:Yeah. And another difference in the enterprise side is that I, I think that more of the value in enterprise accrues to the operator more so than the manufacturer of the drone itself. And so you have to go one more step up the value chain to get close to the customer to really get that.
Arnaud:But if you control the hardware you control the rest of the value chain you can rise the tide and keep people into the other areas and there is also a thing is just being the player that can have the wider part of the solution, like, platform play, et cetera, is a specific kind of company. You're not going to have like 20 of these in there. It's just very difficult as a pure natural selection building this company is going to be this way. And then you have so many different verticals and different applications that are required to have a plethora. It is very much similar to a Salesforce situation or any kind of other app system that has these integration and these apps that goes in there, you're going to see something similar. It's just more difficult because you have all the hardware component to it, but who owns the hardware owns whatever software happens at down the line.
Luka:Now can we spend some time talking about the supply chain? You mentioned earlier that DJI does not have an iron grip on supply chain. At the same time, this is a common argument in the industry that kind of points to, DJI being able to tap into the economies of scale, not just internally, but also the Chinese ecosystem that over, a couple of decades has emerged as you know, the factory of the world and people just assume that, things will be manufactured there. And so the early drone companies in the U S and the West in general, they pivoted the software as the way to differentiate themselves. But now there's another totally, a orthogonal geopolitical element to this that is urging a decoupled supply chain. So what are your thoughts on this industrial base for drones and how much capital time is it required to replicate something like that in the West?
Arnaud:So, let me take two seconds to talk about a point and how I'm seeing these things. I don't think it's about supply chain or anything. I think that what I was mentioning before about the whole AI and the application is the same story is that every now and then you're going to have a low level element of engineering that's going to lose the appeal, like hardware manufacturing has, and everybody's going to move up, believing that there's more value there. When I was a student in my school, I did a school called EPITECH. We had a sister school there that was EPITA and they were, the guys were super arrogant and stuff. There was this guy there that used to just trying to, poke at me and says that we were going to be technicians, whatever, and he's going to be my boss. And I said to him that, no, even if I end up working for you, I'm going to be your boss because you're going to have no idea how things are being done. And you're going to rely on me more than I'm going to rely on you. And what was going on, what was true there is also true in everything else. If I'm the guy who knows how to do the kernel code and the operating system code, it might not be sexy. That might not be the thing that has a high salary. But I control your future of everything that is on top of it. The manufacturing is a similar thing. So what I'm saying that DJI doesn't have an iron grip on the supply chain is that anybody can replicate what DJI is doing. And the way to get to it is to actually start going over there in China and learning from them. That would be the first step. And the first thing that you gotta do is just like understand what is this infrastructure, what is this ecosystem that they piggyback on. And back into like, go to Shenzhen, have a look. Go and talk to the Chinese and learn from them to begin with instead of already looking at them as enemies, etc. And again, Me saying these things, I know that some people in the U. S. are going to think like, there you go, he's a party member or whatever the hell, et cetera. And I got like all sorts of stuff coming to me when I was at DJI from glorious people that I'm not going to be giving their name now to give them any sense of publicity. But it's still true. and these are the things that you got to be doing. Like for me, the whole perception of the risk comes back into supply chain, risk, which is that right now supply chain is being weaponized all the time between countries. Through whatever you want, like I'm banning this stuff, I'm export controlling these things, I'm tariffing this stuff. This is fundamentally the golden reason why everybody should be paying attention to how things are being done. But at a company level, everybody should be looking into what is so important for them that if it disappeared tomorrow, they would die or they would take them an infinite amount of time to actually do these things. And I even say that, you need motors? Why don't you buy yourself, go to China, buy yourself three, four, five motor machine, put them in a warehouse. Right don't touch them but if something goes wrong, at least you can pull that trigger. It's going to cost you like 50 to 100k And then you can actually get pull that trigger if you want to you don't have to actually start going in there but you need to actually being able to de risk. But the way to actually put the capital is that what you have in China in Shenzhen in the country as a whole is you're right, there's like a very dense, very rich infrastructure of countless vendors who can build anything you want on a moment's notice. And they're not only ubiquitous, they're extremely good at taking unbaked or half baked requests and finishing for you. And you will never tell you this until you're actually close to them, but you got the West is coming I got my great design and they look at it. It's like, wow, this looks like shit. I'm going to have to fix it. And they have a dedicated in house engineering team is going to fix it for you. So that's actually manufacturable and then sending it to you without you hear anything. That's what you got to be able to replicate. But in short term, I mentioned that to many people and Bobby Sakaki made an echo on it. I don't think he got much traction that I ever got on this topic. But I said, a PPP loan program type of funding for all of the people in the US who are interested in manufacturing, who have a little machine shop here and there, and tell them, like, here are the capabilities that we would like to be seeing as an industry. And if you develop them within that time frame, we will be loaning you the money and writing it off so you can buy the machine that would have a dramatic impact on the ability to actually structure this. After this, there's companies who actually can provide you the software infrastructure to bring all of this, displaced ecosystem on the one banner that allows you to be able to do all this prototyping. If you were capable of doing these things back into your iteration, everything would change. The thing was 2018. I was invited to do TechCrunch Disrupt, and I attended a talk from, serial advisor from, I forgot the name, but he created this, this incubator in Shenzhen. And at that talk that he was having, he said something that stayed with me. He was talking about why he's bringing, tech companies into Shenzhen for an incubator for three months. And he was saying that one of the companies that he had, funded, once they moved back into the U S there was this part that they needed to be a laser cut or something. And they run quotes with local vendors and their timeline and et cetera. And he said he was cheaper for them to get a ticket, hop on a plane, go to Shenzhen, get it cut into a local shop in, in Huaqiangbei and fly back and cheaper and faster than doing it in the U. S. That's the problem you have. That's the problem. So you all have six months to get something done. In the U. S., you're going to get five iterations. In Shenzhen, they're going to get 20, right? You got to be going in there. Now, I don't know how to get such a boring topic understood by a decision maker at a policy level. But that's where the rubber meets the road, right? In a lot of these boring things, etc. The software follows and comes in after. But you got to do this on PCB side. You got to do this on component side. You got to do this on silicon side. You got to do this on the sensor side. You got to do this on all the things. You got to do this in screws. It was the story in 2013 when Apple was going to bring the factory back into Texas. I think it came up, I read this, I loosely remember. But they were saying that their number one problem was custom fasteners. That there was no one in the U. S. who could actually get them the custom fasteners. And that was really what was the problem, is that you can't have your realizing that there's a design problem in your manufacturing. Make a change decision freeze the line for another three months for your vendors to actually get this stuff done. This is too slow so that's why you go back into the Chinese ecosystem. It's definitely not about the cost because at this point Shenzhen is ridiculously expensive but that's the capability that you have so you can replicate this elsewhere but you got to start by bringing this stuff in.
Luka:So, in the absence of this infrastructure in the West, what's the right model to build a defensible drone company in the West?
Arnaud:I think what you see with FPV is a is an angle of change that I really did not expect and I'm not saying this because in 2022, when the drone started to be used, it didn't click for me yet. What started to click is that there was two opening doors. Number one, FPVs are ridiculously simple to put together and that means that you can produce and deliver to the end user a product of value with a lot less, burden on how to actually produce something, which means you can have a progressive build up of your capabilities while delivering final product that actually have a use for the end user. That is a unique opportunity. And then the second part is that FPV allows new group of people to gain interest in drones with the familiarity of the topic because they heard about it for the past few years, but not necessarily being burned because they were part of that generation that tried something and failed. And that means that you get to progressively bring your capabilities in house and that's what we're doing at Orqa, right? Progressively bringing everything that we're doing, in house bit by bit because in absence of a blank check from, Uncle Sam or, I don't know, Uncle Europe, whatever, you gotta have to figure out a way to squeeze that in. Skunk Works and then progressively bring it in. And that's a level of star alignment that is pretty hard and unique to put together. Because you really you gotta be able to have the right product that is really generating the right traction and being able to have the right margin so you can reinvest this stuff aggressively into your own capabilities, because this is fundamentally building not only your own capabilities, but also the capabilities of the future. And on our side, we're even looking at things that like we're going to be creating eventually independent companies that will be servicing our needs and other people's needs at the same time, because there's an element of mission driven and what we want to be doing. I'm looking forward to what is going to mean in terms of our ability to do stuff because right now when you have to be relying on China you have no idea what's going to happen the week after right at any moment you're going to get a message that this whatever component is no longer accessible because it fall into this whatever umbrella of some, geopolitical attack and you dig in and it's like, oh, so someone said something wrong about China and now they're upset so they're cutting the tap, right? So this is for me an element of survival at this point more than an element to try to stick it to China, which I think it's a topic that is much more complex than what I'm doing.
Luka:So this, FPV as a catalyst for a new wave of companies coming into the mix, that, are free from some of the choices in the past that some of the big players have done. And then these geostrategic shifts, how do you then assess this new wave of Western drone companies and the drone ecosystem in terms of still again, performance cost, defensibility?
Arnaud:So the trend I'm seeing that is worrying is that there is an acceleration of the Adam Neumann of the world and the SBF of the world and the Elizabeth Holmes of the world, etc. And, there's more and more people who are just trying to pull off, what I call heists. They're just trying to make the biggest amount of money that they can as quickly as possible. And they're seeing the defense as this cash cow, I'm not a, I'm not a GI Joe wannabe or, a military nerd of anything like I never held a gun and never shot a gun. Really doesn't do me much for anything, but I still find it despicable as an attitude that this is a thing that is happening. And fundamentally there has been precedents of people managing to sell bad equipment to the customer. So we're going to see some of these guys getting a reinforcement feedback loop and what they're trying to do, but ultimately this is a marathon and I think these companies are going to be coming and dying very quickly because this is really about, sustaining what you can offer to them on the defense side. And also you have a defense customer that is getting more and more savvy on how to actually get what they really need. They are also getting sharper into the requirements and, about what has to be, uh, done and I think this was really like a changing time and that's going to force people and they're going to pay attention to who can actually deliver what they're looking for, etc. The enterprise customer is already there big time, right? And I would say FPV has a play as a narrow play in the enterprise because I'm putting public safety as there and, in the tactical drone, you have like guys like BRINC doing this stuff, but they're not the only one. You got something to be there on public safety and some, Firefighters were using this, guys like Tom Palmers in Belgium, now he's in Holland. He's been doing a lot of work on this front and taking the Avata to be used. There is an FPV play in here. And then there's stuff on the more like military side. And I've spoken to some guys in, in, the France, Bari, which is a, a kind of a SWAT like super elite, unit. And they're using these drones as well for, anti gang, counter terrorism kind of tasks, et cetera. But they're not military, they're police. so there is a play in FPV in there that's like the narrow. And I'm. Hoping that they're paying attention as a whole. And that can be like the wedge that comes in, but you have a customer that is already very demanding. So all of these SBF wannabes want to do a heist I think some of them are going to make money. I think it's going to be really bad. I am hoping it doesn't create another wave of VCs are going to get burned. Because, it's hard to detect which one are really going to be the one that's going to go the extra mile and those who are here for a heist. But I'm, I know that there's going to be some companies who are going to be building something specific because they have a desire to do these things. I know this is exactly where I am. Some people have said that I'm in love with the drone industry. But I was dead out in 2022. I was done with it. I was sick and tired of seeing things going nowhere. And the reason I am back is because I saw the opportunity to actually provide something that was going to be good and the stuff that we're doing at Orqa. and that's what I want to try to really see. And in this case, you can see an actual big giant coming in, but I am laser focusing on the quadcopter stuff. And if I'm broadening the drone stuff, we already are seeing a change. We're seeing the beginning of the multi domain drones coming in. And I'm not talking about the legged stuff, which is now super common and ubiquitous, bipedal and quadrupedal stuff. I'm also talking about other applications like on the boat side. I pay attention to what the Chinese are doing and what they're deciding to market in general. And just today I saw a very big. Chinese manufacturer marketing a, river cleaning, boat drone. And I was like, wow, that's wildly specific. But I took it this as a market signal about the diversification of robotics is already starting and going in there. Now, I don't think this is the right time, but I think we're going to start seeing more and more companies. And probably in these other domains, we're going to be a lot less, what BF like people and more into trying to get into the next wave. And that's the thing that is simmering in the background. I'm paying attention and I think more people should.
Jim:For our audience who may not be as well informed on the overall drone industry, give us a size of the overall revenue opportunity in the drone market today. And then what would you say it's going to be in five years?
Arnaud:So I have different data points that are more or less reliable. And so I believe, and this is the things I heard from multiple people, that DJI right now is making about 25 billion dollars of revenue a year on what they're doing. So that gives you like a bit of the mostly consumer side of things in terms of sizing. Market size, a lot of people have been sizing enterprise at about 100 billion. I think it's bigger than this, especially when you start looking at all the different applications that exist. When we talk about the size, there is the vehicle size, and then there is the rest of the value size. And I think that what I'm mostly talking is the current DJI model. You've got a drone, it collects data, you got your picture out. The rest of it is probably even bigger and it's probably going to be a natural, a series of acquisition for anybody that runs an ERP, which is funny enough because in 2018 on a dare I spoke about getting like a little meet with Satya Nadella meet actually happened and I told him point blank that he needs to get the Dynamics team to pay attention to data acquisition from drone side because it's a natural module for any ERP, but I don't know if they have put any plan on this, but I still believe in it. And that would be probably even bigger because what you're seeing is that we're getting at the end of what you can do with data for the sake of data, right? So 2020 kind of like, you know, at the sunsetting of we're massaging data out of data generating computers. You've got people typing in stuff in and then creating actions, placing orders, buying stuff online. This is all data generation. It's the data world that comes in. What the mobile robotics world is bringing is data that is collected from the rest of the world. Now it's a much more complicated problem, but it's a much bigger problem. So if you follow this line and you go into the five years and it's suspending that everything is going successfully, we're probably talking about trillions. it's humongous.
Jim:Now that's eye opening. For a person who's a realist, I'm hearing you're saying you're going from roughly 100 billion total market opportunity to trillion plus. What are the use cases that are going to drive that? I'm sure the capabilities are going to be much more sophisticated, how are the use cases going to change that would drive that kind of growth?
Arnaud:So there's so many, but the thing that I want to more leave you with, I would say is just pay attention to how many things are being done in a complete absence of information. And this is where you start realizing that the potential of doing things that are more educated with data is huge. Take a cleaning machine, that you would have in an airport. Right now, you just give it to actually clean the floor. It's super well done. It's like a Roomba, whatever, et cetera. Give it to it a couple of right sensors and now you have an occupancy management system. And that what it can bring to you is a real understanding on how to be managing security lines and managing, booth attendancy and all sorts of things like this. The productivity and the boost that you can have out of this access to this information is huge. What AI is bringing to you, the most valuable thing AI is bringing to you in my opinion, is the ability to process this information. Because what AI is wonderful at doing is finding the signal and the noise, providing that you've been training it. And that amount of data generation is gonna create an insane amount of noise. And this is what you want. This is the refinery of the data. The data is your oil and you got to be able to extract it into something. So if I'm taking the cleaning robots, you have this. Take that cleaning robots into a, a supermarket and you're going to have all sorts of different kinds of elements that you can bring into the table as well. Now, traffic is one of the elements that is used because it's a revenue generating angle, but you can have cost reduction efforts that you can bring in by identifying, inventory, problems, which has been looked into. It's a more complicated problem than it looks into. But then once you take this stuff into all the rest of the infrastructure. You take this into the medical world. You take this into stations that could actually be paying attention to do pre visits for patients. This is an element of productivity that goes on and on. A robot doesn't have to be something that walks around you or crawls next to you, etc. On the ocean side of things you have, we haven't even started touching on anything that is floating in the water. I'm a very big believer, and this is something that is like impossible to pitch on VCs, that we can produce clean water from the oceans with mobile robots. And I think that the next wars in the future are going to be fought on water. If this is true. Right. Do you imagine the actual value is going to come with the climate problem that we're having? But then you can go back into the climate change the same thing I've been defending this for a long time that you could fight wildfires with drones. Now that doesn't mean they're gonna go when you have like 80 miles an hour wind or anything like this but what it means is that what robots are super good at and this is what we're seeing with the defense side, they're good at being put in danger instead of people. They're good at that, and they're very good when you actually operationalize them at scale to just keep going one after another, one after another, one after another, one after another, right? So you can actually put them into a fight. That doesn't mean that it's going to solve the other problems that you have. That doesn't mean that you can just put a bunch of drones out there and then boom, there's no more wildfires. But then it goes on. How much money is being spent? In insurances, because of the situations of wildfire that you have in there, how much is being spent on repairing on sending people on resources to actually that the list goes on and on. It's just that it is a very complicated problem. It's the next frontier. I didn't say the next playgrounds, the next frontier.
Luka:What do you think will be, the competitive battleground for the drone industry going forward in the next, call it five years or so? What will be the defensible differentiation for drone players? And, how do you expect the competitive nature of the industry to change or switch from hardware today to something else in the future?
Peter:And Luka are you, talking about in one vertical of the drone industry or another or just across the whole thing?
Luka:Across the whole thing, but that's also an interesting angle.
Arnaud:I think the number one is going to be reliability. And at this point, this is the thing that is surprising people, but as the number one reason when you ask people, why do you buy DJI? It's because it just works. Reliability is the biggest problem it's the thing that takes you a lot of time. It's very difficult to actually unpack. You need to really know how to test and grill your hardware to be able to make this stuff as efficient and cost effective as possible. Number one. The second is going to be openness because everybody got to understand that any robot that you build out there is the beginning of a story. It's not the story. It's the beginning of a story. Like you build the Boston Dynamics Spot, no one cares that it's actually walking. What people care is that what the walking enables it to do. And it allows it to go into human infrastructure, which is huge. But once you got into the human infrastructure, what is it that I can do? There's a lot of easy things that it can do. But if you as Boston Dynamics, you want to continue developing the best walking robot, you got to be enabling, and they've done a great job at this. I'm not even saying this as a diss or criticism. You got to enable a thousand companies be after you to be putting Spots in all the possible ways they can think about. That's the openness, reliability and openness. And that's fundamentally what I'm seeing as a problem is that there is kind of like this weird feedback loop that if people talk about your stuff in the news or TechCrunch is writing an article about you, you've won. But that's not the measure of success, right? Because any gimmick sells paper. So of course they're gonna talk about it. And I mean, there's nothing wrong about that. It's not them wrong. The one person that decides, and I say this like, is the blue collar in the corner of the room. That blue collar in the defense is a regular soldier who's actually gonna be flying these things. And their command is listening to this person because he's the expert in the room. He's the one who knows how this stuff is gonna be used. And in the field is the guy who's just driving to all the wind turbine and flying this stuff one by one. This guy, he's gonna come and tell you that, hey, I tried to be inspecting 18 towers today, I only could do 12, because 4 of them failed, I don't know why, where is your reliability? And this is the part, is that the role, and this is hard for roboticists, because you got decades of momentum, of Star Wars stuff, and doing funny things, who are cute, and weird, and gimmicky, and this is fun for them, but, their job, as roboticists, is to remove the robot from the robot. That's the measure of success. Once you remove the robot from the robot, and anybody can use it, Then you start actually exploding and that's where the competition is going to be.
Luka:Okay, let's, again, let's drill a little bit deeper and you mentioned openness and yeah, there's still a big pain point today in integration, not just within the drone, but also between the drone and the enterprise ecosystem. So what will it take for drones to really be truly invisible in enterprise workflows where, the operator is just focusing on the thing that it's getting back from the drone and not drone operations, not data integration. Where are we on that journey? And the reason why we are where we are and how to go forward.
Arnaud:So the, this is a system integration problem and, so the way, how you do this is by having the robot being more and more self aware, with big quotes, about its own problem. And this is basically that each of the components that you have, you as an engineer have characterized really well the failure cases and how to resolve them. And you try to resolve as many of them as possible automatically by any kind of secondary mechanism that can actually help you resolve a problem where things are coming. And so much of the technology that we have right now, which is also my main argument against the Skynet world, is that I have a problem, human, just figure it out. Right. And we are tossing it to the human to figure it out. This is really where a lot of these things are happening. And you gotta be able, you're supposed to know how the drone is working and failing. And you gotta really actually be guiding this whole thing. DJI did a great work. And this on multiple front number one, every component of the drone is super intelligent and it's getting smarter as the time goes by. There's a ton of software and tons of things like this. It allows you to really have all of these things. Your involvement as a human is extremely limited and minimal. That's what you want. On the Auterion side, the flight control guys did a really, really, really good job at creating early detection and understanding of the flight control dynamics, which is, I would say, probably even pushing things further than what even DJI was doing, but I haven't really dived into this topic on DJI recently. But that was kind of it, right? If I'm trying to be aggregating different components who are foreign from each other, like I'm grabbing an xVision camera and I'm grabbing like, a Pixhawk flight controller and I put an autopilot on it, right? Getting all these components to be able to understand each other is a system integration problem because the person who's going to put these things together has to be baking in all of this understanding of the failure situations and how do you resolve them because you as the operator, you do not want to have to be an expert in how to debug this problem and how you handle this. But that's the state that we leave people in. And again, it's not particularly sexy and definitely not as sexy as AI and everything, but you can use some AI into it because again, these are heavy data generating sensors and systems. And this is a lot about detecting the signal and the noise. You can train them, there's all sorts of things to do. That for me is the real, element to it. did I cover your question?
Luka:Yeah, you did. And, what about integrating with enterprise workflows and ERP systems, what's the complexity there and why are we still not there?
Arnaud:So that goes back into, developer program. I feel like I've been like a super broken record because I use developer tech, developer tech, developer tech all the time. And I promise I'm not the French bomber and I never want this to be coming around. But this is true. It's really all about this. So it comes back into this. Let's say that I have some batteries, that they're going to have, a regular battery, a good drone battery is going to have about 500 charging cycle. Okay. And so with these charging cycles, which you can keep track with a proper BMS, you're going to be able to actually estimate how much flight time you're going to have based on what has been done around the block, etc. What you want to be able to be producing is a level of simplification of the operation, removing the robot. Where, hey, Jerry is going to go and inspect the 17 towers. Each of the inspection is going to be 12 minutes. And these batteries are going to have, 24 minutes, 30 minutes. And being able to automatically allocate these batteries based on the job that you're trying to do. Because the end user doesn't care about how many batteries they want. They want to know, they want you to tell them, what's the gear do I need to bring in to get my job done? Right. For them, it's a hammer. It's a screwdriver, right? And they will simplify this whole thing back into the, what I was saying, like the number of decisions that have been done in the past without any data. If it was a screwdriver, they would just take extra batteries. They would not try to calculate and think how many that they have, but drone batteries are a little bit more complicated and more expensive and bigger and everything like this. So bringing data into the system would actually have a significant cost reduction and operational optimization. How do you do this? You got to be able to bring all this information and system understanding down to this tool that's going to be planning the mission. Now, say this is you trickle this stuff down from the flight control that has been logging this from the battery health monitoring that should be on the BMS. You push that stuff up into a cloud platform, but you don't leave it into a fleet manager that is generic, one size fit all for everyone. You're bringing this in as a data source for someone to integrate them into a utility planning tool. And that's actually how you bring up, and you remove the robot into it. It goes back down into the developer program. But for the guy who is an expert at planning utility mission, to be able to do these things, they need to be ending up like, in a velvet world of silk and rainbows and unicorns of a developer program, where everything has been catered to them, etc. And definitely not what you see right now, which is a link to a GitHub repo. And then maybe a README and go figuring out because the code is a documentation and there's no documentation in the code.
Luka:Very interesting. Okay, let's talk about the future of FPVs. Obviously, we've seen a radical evolvement of, how FPVs are used in the war in Ukraine. How do you think they will continue to evolve? What's their long term role in defense?
Arnaud:So what I told people about FPV is that you got to not look at them as FPV, but what you see right now is that there is a strong countercurrent about this because everybody that has been doing FPV was in a niche of FPV and no one cared about FPV. They're approaching this is like, this is my moment to shine. I'm going to give you like all the FPV that you've ever had in your life. And they're going. It's like, all right, so we'll start from the beginning. So you got your TX 16 and they go crazy FPV. And I told them is that you're missing out the point. From a military standpoint, if you're not already an FPV pilot, the way you're looking at this is some sort of KPI that I'm still working on. It's like, it's a precision per cost, kind of like a metric. And what that means is that you gotta be looking at it from this particular robot is delivering a high value on that metric. Now you can think about how you would have the similar metric into another angle and see if there's any better way. So far, there's no better way to actually do it, and that's where it goes on. Does it have to be FPV with goggles? Probably not, if you had a better flight control, if you had a fully autonomous system. There's probably going to be a moment where these things won't even have any control whatsoever, because the agility could be encoded in software, the targeting could be coded in software, and the rest goes on. And so what you'll have is basically like a weird self standing missile, or sword, that you press a button and it goes and does its stuff, that's not crazy to do it, but the future is going to be a long gaining on that value, on that precision per dollar, element to it, because that's really where it is that this was the, and again, I'm not a military guy, I'm just observing things, but tanks were designed because they didn't expect that it was easy to just precisely go around them and hit them in the back, right? And that's what you change, so you have all the armor, now he's at the wrong place, but you, as far as I know, again, not a military guy, you can't really build a tank that has armor everywhere. At some point, something's got to vent. And so you're going to have always some, someplace of a weak point. And that's where you bring in. Now, what I think is going to happen is this. I don't think that people are going to be trained to be a FPV pilot for, a significant amount of time. You're going to have to train the entire army and that will create a, basically a one to one fight on who can train the biggest amount of fpv pilots and if you boil down the whole mechanics that goes on It you're going to be like summarizing who's going to win and who has the biggest number of fpv pilots and biggest numbers of drones behind this thing because there'll be drones against drones So the way to actually gain on these things is to bring some cognitive load reduction functionality that allows the pilots to be less of a pilot and doing more than what they're trying to do. So we're talking about FPVs that flies themselves more and more. We're talking about, drones who are going to have, a moment where you just hand over. So maybe you find a target and terminal guidance, you just let it go and you switch off and you're already moving on to the next one trusting that what's going to happen is going to happen. We're talking about, swarm. I'm putting big quotes on it. I prefer the term of flocking, which is that you basically are capable of flying multiple drones at once, which is again, an element of reducing the cost of the precision because now you can send three of them for the cost of one pilot as it comes in. And then the list is going to continue around continuing defending and building up this particular kpi on when you actually go in. And to be honest, it's a crazy dynamic, environment and i'm holding on to this loosely because something tomorrow can come up that was going to make me completely change my view on it. But so far this has really been what it is. Even when you had fiber and other things like this, et cetera, it's because when you go into EW resistance and everything, this is an added cost. You bring fiber into the mix, you reduce the cost and no longer have to fight with EW. I think we're going to see kite fighting with all these fiber drones coming in. I'm just waiting for drones with a couple of blades in the front like this to try to cut the fibers. I don't know if it's going to be practical, but I know that at some point, something like this is going to come up and I'm. I know I'm getting deep into the product, et cetera, and I don't want to be insensitive because I also understand that all these iterations and discovery and what's going on every single time someone dies, right? I very much appreciate this, but I'm trying to also stay focused on how this is happening and sticking to your question. I just don't want to be misportrayed or misread as someone who doesn't understand. I appreciate that
Luka:Fascinating. What has been one of the, biggest surprises in the way that FPVs evolved?
Arnaud:They got bigger and, they got bigger and they got meaner. And this is the thing that I really paid attention to most about. And I think, the majority of the FPV community, when they had a big drone, it was a 7 inch drone, and for them, that was a big drone. And, me, I'm looking at this. One of my favorite drone ever is the M600 at DJI. I just love that thing. Super scary and dangerous. Six batteries all around, etc. It was roaring in the sky, and it was not even a big one. The Alta X from FreeFly is even bigger, and the stuff we're doing at Volansi were even bigger. And I'm looking at these guys, and they're like, they have their 5 inchers, 3 inchers, and you would fly around, they buzz around like, like, little mosquitoes and now they got big and they got big and it got chunky because now we're trying to push them into an envelope of operation that is completely different. You now have a regular drone that can fly 25 kilometers and then carry five kilograms all the way there and this is really an interesting development about how they morphed and again not in an insensitive way it's like they went to the gym. But also, what you see is that the amount of effectiveness that you can do out of almost nothing, an STM32 flight controller, a little radio dinky stuff, and a little bit thicker carbon fiber, and how much change and impact it has, it's kind of nuts. It's kind of nuts. And, it's a level of disruption I don't think people are really paying attention to. I think the overwhelming population is not really appreciating the level of disruption that it is and how this can be dramatically weaponized. And that countering these things, not only it's ridiculously easy to bring like a 10, a five kilogram, 10 pounds payload 25 kilometers out, but it's ridiculously hard to stop it. Right. And this is a level of disruption that is probably nuts. And it all came back down to this. They got bigger, they got meaner, and suddenly they didn't get much more expensive and, and suddenly you have this crazy new realm of capabilities that coming.
Peter:So what are we learning about the role of agility in these FPVs as they get bigger? Are they sacrificing agility? Does the freestyle level of agility that you see is it relevant in combat or do you not need that much? And you just say, Hey, okay, we'll go with a bigger air vehicle and it's going to be enough. But what are we learning there?
Arnaud:So I'm a horrible FPV pilot. So I'm going to be talking about the experiences of people who are really good. And you definitely lose in agility. And I will quote one of the guys that works with us at Orqa. He's a phenomenal pilot, and when he flies the 10 inchers for demos, et cetera, he grabs his freestyler, his three incher, five inchers and he says, like, Oh, I feel like I'm finally, you know, like moving a little bit and being able flexible. It's a bit like this. And he's doing the crazy freestyler stuff. So you really do have this, but if you pay attention to a lot of the videos that are out there, and this is a very, very widely documented conflict, you're going to realize that the way they fly the FPVs it's not that much different than you would do with a Mavic. So when I'm talking about the agility, it's a relative agility, not freestyler level agility. It's a relative agility to a big piece of equipment or a person. And again, I, on the anti personal aspect of things, again, I don't want to be insensitive, but you do see that the level of agility that the FPV has is not to the level of agility of the person. And you see often in these videos that the people are capable of dodging these drones on the first pass and then takes them multiple passes to get a hit, which is, pointing out to you about where the things is going. I don't have the actual answer about telling you that if it is the best way to do, but it could be that we're going to see a series of smaller, more agile drones. For anti personnel missions, and then we're going to see larger drones for anti, armor, missions. But what's going to happen if armor disappears altogether because it gets systematically destroyed the second it goes in the field? I honestly don't know. This is part of the dynamism of this conflict and this technology that is so intense. It changes so much every week that you, right now it's just hardcore speculation to, to be saying what it would be.
Peter:Do you see the evolution of FPV sort of bifurcating depending upon the militaries that are adopting it? So, the first world powers have complicated militaries with a lot of integration. Are they going to adopt one thing, but the FPV that we see today in Ukraine may find a future in other militaries of the world. This is technology that delivers a capability that pretty much anybody, any military could afford and may find reason to adopt. What do you think?
Arnaud:So, so this is a super interesting topic, but, and in a nutshell, I will put it this way, so I don't think a lot of the Ukrainian technology is going to be transferable to the Western market like this. I think that what they have going on from what I hear that everything that is drone related is export control by default is preventing them from actually creating that next phase and what you actually see that is happening is as they're catering to the domestic needs, their information is seeking out because it's not, export control, but the drones and the products aren't really coming out. And so the same as everybody's going out there and building an office in there, If they could, they should actually create an office somewhere else and being able to actually get into the customer that goes, at this. Fundamentally, the real thing that they will have, and this is a context that they win and they maintain their freedom and this I don't really know what's gonna look like, but is a level of expertise that's going to be unmatched and on, on this particular aspect, I think it's going to be pretty much suicidal for people not to have a footprint somewhere in Ukraine and tap into the people who have been trained and have this kind of experience is going to be absolutely nuts. But in terms of what you were saying about the capabilities, I think that flying the stuff from an individual unit level, like the Ukrainians are doing in the West is not something that's going to work from my understanding. Again, I'm not a military guy, but what the U. S. military has really developed over the past 20 years of, war that everybody's going to have a different opinion about. There's one net gain about this is that they have developed a lot of their understanding of the collaborations and working into a multiple environment. And they've really much have an appreciation and multiple conversations I had with people on this front, they were all adamant. They were saying that we don't fight the way the Ukrainians will. We fight together and when we come in, everything is coming in. The Air Force is here, the Navy is here, the Marines are here, the Army is here, and everybody's got to be working together. But, so that element is going to be mandatory. And we're back into what we were discussing about the enterprise element to it. That data that the drone is creating has to be flowing into a system that's going to be able to actually make some sort of educated information about this. And I'll give you a very simple example. Let's say that you're flying a drone and there is a bit of a concept of a first path lethality, which is that you're going to fly the drone, but you don't know if there's a target, but you want to be ready to hit the target instead of having to wait and ask for someone to actually kick it off. So you're going to fly a drone and the cameras and sensors are going to start picking up a bunch of things. You as the pilot, you might not be detecting something, but a classifier could be able to detect something. Maybe you detect something, the classification has detected it and you get shot down and you lose the feed and everything goes down. That detection, if it was to live with you as a pilot, could be dead right there. But if it was a data point that was pushed back into the rest of the system, it would actually be able to be becoming a decision element down the chain and being able to actually decide what you're going to do next. And that's where this whole back of the integration of the data, in the exact similar fashion that you would need in an enterprise with a completely different context, super matters in where things are going. So right now you see a lot of firmware based drones. You have an STM 32 of different version, and then you have a Beta Flight to firmware on the, on this thing. And that's it. And they're all going to have at the very least becoming data platforms. And that's going to become an integration job to go all after the rest. I'm seeing the U. S. really paying attention to this. Thanks to a specific, person in his initiative. This stuff is really there and he really writes it all down. And he tells you exactly like, you know, like, yeah, this, and it makes a lot of sense. But in other Western armies, what I'm seeing is that they're kind of like still gauging and what's going on. And so they're defaulting into, we're getting equipment, we're going to train. So at least we got some base knowledge of where things are going. But they're not as active at thinking about the integration or what it looks like. And I think it's because of the, they don't have the exposure of the conflict that DOD has.
Luka:Okay. So you partly answered the question that I wanted to ask next, which is, I do agree with you that people underestimate the kind of impact the drones are having in the war in Ukraine. And I've heard a statistic somewhere that maybe 70 or 80 percent of all equipment destruction is attributed to drone operations, which is staggering. Right. But at the same time, the frontline is relatively static. And so, how do you break out from this stalemate in, in actually having an impact on the war and not end up in a static front line. So you mentioned the better exploitation and and dissemination of the data that drones accumulate. You mentioned a different role of the human to where they don't need that level of, manual skill, swarming, what are some other waves? Or maybe you can elaborate on some of the other ones that you mentioned previously that will enable this, breakout next level.
Arnaud:So we're going into the part of the topic where my shallowness in military experience is going to show, because I honestly don't know what I'm getting and learning. And I think it's information that is pretty open everybody can get to is that the frontline is not World War One shoulder to shoulder, trenches, the entire thing. It's a bunch of pockets of guys and there's tons of gaps into the, this, and it feels like very sporadic. And I don't even know how you would start to begin managing this entire thing. But what I do know is that I, what I do believe is that the counter UAS advancement is where the breakouts is going to be. Because to actually being able to penetrate, you're going to have to be able to stop the other side to be stopping you with their drones. One way or another. And I think right now there's a lot of. Of backend attack that are happening. And so, I'm assuming the, there's like sabotaging in factories based on stories that I'm hearing, or trying to be preventing you to have your supplies of drones coming in through sanctions and all sorts of things like this, it's like the angle. If I can starve you from your ability to have the drones, then you're not going to have drones to stop me when I'm sending regular things, but I don't think it's a technological breakthrough beyond counter UAS. And counter UAS is a very difficult topic and I'm reading a lot of very naive things. And things that you can easily check and, and challenge based on napkin calculation. Right? So you gotta like, and I see some stuff and I'm trying to be helpful on the pure engineering side of things. Because again, I don't know, but you take a Shahed, right? It's like 250 kilogram drone that would come in. So that's not an FPV drone that would come in, et cetera. If you want to stop that thing, you're going to need to have something that is pretty big. Right? And I, and we spoke to some people, I spoke to some people. And they're coming around that there want to be using like a tiny 10 inch FPV and try to hit the propeller mid flight and then somehow hitting it correctly to the point that is a catastrophic failure and the stuff is just crashing down. And I'm looking at this like what I heard from you is that you have a big bullet and you want to hit it with a smaller bullet, right? And this is nuts. You're going to have to be going after a lot more technology that goes into the detection in terms of the guidance and we know how to do this with missiles. But that's not the problem. The problem is too, we can't be throwing a million dollars behind every$1000-10000 drone that is out there. And so that's what I think is really what's happening. On the counter UAS. I'm sure there's lots of things cooking I'm not aware of, but that's really what I think is really the way to actually change, any of that stalemate or, maybe some political turmoil that happens on one side or the other that is like forcing people to surrender or something like this, but on the pure technological side I don't think that this is about, creating like a specific thing. Like, even if you were to create like a super armored, robot that would come in, it was just going to be like ready to be picked up by, by FPV drones, because they're just so good until you can actually stop the FPV drone from being so effective I don't think you're going to have any magical turtle kind of thing that's going to be able to go through and take the hits.
Luka:What's next for drones? What do you, anticipate the continuing drone evolution to look like in the next couple of years?
Arnaud:So I think there's going to be a ton more of FPV stuff, as the world is figuring this stuff out and going in. On the enterprise side of things, the next big thing is someone coming in with a piece of hardware, and I hope it's going to be us, that's going to be able to actually make a difference and offer something different. And again, I covered during the conversation, we had the angles that I think really matters, which is, access to the data, reliability and openness. I think it's really the element that do matter. Doing it right is where things are difficult. that's really what the enterprise customer is looking for, especially as they get squeezed in the U. S., ban against DJI. But I also think that even if DJI wasn't banned, the opportunity would still be there. It would just be slower, it would just be a bit different. I think the ban on DJI on this particular front is just a side note has more chances of hurting, robotics operations and enterprise altogether than helping American companies or Western companies to offer an alternative. But, that's just my opinion and time will tell. For the drones in general, I think they're gonna get smarter, a lot smarter. A lot more autonomous, but not avoiding trees, et cetera, but more about being able to make their decision. The defense sector is super not on board with having AI making any kind of kill decisions. So I don't think this is going to happen anytime soon. But I think you're still going to have a lot of removing the pilot cognitive load that is necessary and there's a ton of work specifically in FPV and we're gonna see them being bigger and we're gonna see them going into different sizes and one thing that I'm really hoping we're gonna see because it's that thing is is layered and what I mean by this is that when we look into the airspace used to be the domain of planes right from zero to infinity, right? I'm exaggerating but there was planes but now what we're starting to see is that you can have a high altitude, loitering drone that can provide you infrastructure right in the middle that could be connected to satellite network that is outside of jamming range. And then you can have lower level ISR platforms where a fixed wing or VTOLs who are capable of being in a little bit more kind of an hour basis above you'll be 12, 30 hours like this kind of range in the air below your a few hours in the air and then below all the multi copters who are capable of doing all sorts of things but I think that the defense sector is going to be the one that's going to allow a lot of experimentation. These applications could come and see in civilian life with deliveries and all the stuff like this. The real problem that we have is the legislation and The real problem is not so much that there's legislation or not legislation is the stalemate that is going on in legislation, because there is not like a wildly country level in any country level appreciation that this technology or this category of technology needs to be enabled and creating us is like, these are the things that we don't know. These are the things that we'd like to know, and this is how we're going to get to these actual answers, right? In a context with most government are trying to reduce the cost, you don't really have a regulating agency that can come around and then start to drive the conversation towards a quick definition, and that was fundamentally what would have the biggest, shaping influence on what future drones would become and, you know, but I don't want to give you like the, yeah, legislation is bad kind of rhetoric that I see everywhere because I think it's more layered than this creating like, no, you can't because it's not allowed, but not telling you how do we make this allowed? How do we drive the conversation to make this allowed. And can we at least recognize that this technology is going to have more benefits than, than problems to it. Can we just actually get to it? We're still not there, in my opinion.
Luka:All right. As we wrap up, on the enterprise side, what use cases are you particularly excited about that have the potential to really start rapidly growing over the next, 12 months, 18 months.
Arnaud:They are the same as before. They're like the data collection is an unsolved problem that still has to be solved and that is still in dire need of actually being in there seeing one success, operationalization of this technology and to end is what I'm very excited about having one company who comes around and this seems like we have a successful robotic program for whatever asset it is. And it's working and this is what it looks like. Let me talk to you about this in my industry panel and how you guys can follow suit. This is really what we need. What we've had so far is a lot of these talks around this is what the experimentation that we did and it's been promising level of conversation. That's really what we want to see. This will be the first market signal that things are about to turn. But right now it's been very much impeded by this whole aspect of the geopolitical angle and the bashing against DJI and all this different stuff. That has ice bucket on this entire thing. So we're waiting for this to happen. And it needs to start with a proper piece of hardware that can come in. And the, I'm not worried about the data companies and their do's and don'ts with integration. Cause there's plenty of them. And this is going to be an easy part of the problem, with big quotes, because I know it's more layered than it looks, but there's a lot of companies who already have this experience, who build up a lot of that knowledge and what they need right now is just basically equipment. To be able to scale the stuff up
Jim:Give us three use cases that you think are going to be dramatically different in the next five, 10 years that we're not seeing today, that people are willing to spend money on.
Arnaud:I think infrastructure management is going to be the biggest one And this is what I was saying like getting the state of what's going on is gonna be the biggest one. It's not gonna be sexy but it's gonna be the biggest one and the reason I'm very excited about this is because we need the infrastructure for our lives. We need the infrastructure for these fires to stop happening. We need that infrastructure for all these different things And we talk about electrical infrastructure, but water infrastructure is a very big deal. And water infrastructure is a lot of underground robotics that's going to have to happen. It's going to be very interesting. if I go on a second aspect of things, there will be more about, climate and, and recovery and repair things. Because, I don't think the climate change is an opinion. Right. for me, it's a science. We paid the UN to have a bunch of people saying these things for decades. I just like to read the report when they come out and it's pretty staggering. So having able to have a disaster response that allows us to be coping with these things better is going to be a huge deal. And as it, after the fact that the catastrophe has happened, being able to actually get that information, it's against the data collection problem, but being able to actually understanding the landscape so you can act on it very fast is going to be super important. Right. Knowing where people are, et cetera, everything. And then what I like a lot is about the robotics that can actually integrate with the world. I think the world of delivery is going to have a significant impact outside of bringing you burritos onto a golf course. I think it's really going to be very valuable for critical supply for, medical supplies in the battlefield for this disaster relief and all these different elements. And that's going to be the next big things about really integrating yourself with the real world. Having a drone that brings you something. This is going to be a lot of work. I root for Zipline. Not because I'm a fan of it, but because I've seen how they work and what they do and how they function. And I think they're the one who have the biggest amount of things lined up. For them to really win and success on this particular front. that's really all. But that would be the three. The three big ones that are going to have a direct, peak impact after this, like 10 years down the line, 2030, 2035, I think that we can replace a lot of the cargo shipping with autonomous boats. Just so we're clear, there's no need to have any person on these things, etc, and things, and if someone tells me pirate and everything, we're already putting miniguns on turrets. We actually can take care of things. There is zero problem by defending a boat that is fully autonomous, and we could even make a boat that is fully, autonomous and on renewables, based on all sorts of different elements. That would make it more cost effective and more reasonable for the operations and the scale of what you have. You could have even smaller boats because then it will be fully autonomous, which would change a lot of the problem that you have, right? The Panama Canal but despite being in the news for other reason is also running out of water, which is becoming a problem for super large cargo ships. They can't really go in because they don't have the depth for it. You start having some of these problems like this that robotics is going to start solving and being able to maintain the quality of life that we enjoy. And it goes on and on like this. I, you haven't heard me saying anything about self driving cars. I don't believe in self driving cars. they will be a lot of fun to have when they exist. But I think that the problem that they're trying to solve can be solved somewhere else.
Luka:All right. We'll have to tease that out of you on a, on another episode.
Arnaud:That's good.
Luka:Any parting thoughts as we close this out?
Arnaud:The one thing that I think is important to take out of this is just that the, I look at the drone world as the, and I don't want to put it this way, but the gateway drug to the real thing, which is the mobile robotics revolution that is around the corner. The problem is that it's not going to be a quick one. It's not going to be an easy one. And because it's not going to be a quick one, an easy one is going to weed out a lot of people. And a lot of investors, a lot of entrepreneurs, a lot of engineers, because it's going to be very difficult. But I think this entire technology category, which is very defense related right now, which I'm very much rooting for this to end very soon. It's going to ultimately go and work for us, humanity as a whole. We created a lot of problems for ourselves. We can actually create the solution. And I think that these robots produced at scales are the one are going to give us the reach that is planetary level. That is beyond what we can do by sending people at every corner of the globe. And that's where you are, where my belief and my love for this technology is, and I just want to leave people at, it looks like FPV wire bombing people. But we're like just one little step forward towards these machines working and helping us.
Luka:Totally agree. It's a window into the future for sure. Thank you so much, Arnaud. This was a phenomenal conversation. Really appreciate your time.
Arnaud:Thank you guys.