Aeryon Labs’ Dave Kroetsch explains the advantage of building a drone business in Canada

dave kroetsch

On the latest episode of BNN’s The Disruptors, Dave Kroetsch, co-founder of Aeryon Labs, talked about the future of drone technology.

Kroetsch started his career in drone technology in 1996 as part of a student competition, and then later worked for startups — digital video startups in particular — in the Waterloo region. Just over ten years later, Kroetsch co-founded Aeryon Labs, which is focused on high-end drones for the military and public safety industry.

“My co-founders and I really enjoyed the drone concept, and we wanted to find a way to turn that passion into a product. So we started a company, and it was a very much Canadian startup story,” said Kroetsch. “It wasn’t the Silicon Valley, ‘let’s raise a bunch of money and then figure out what we’re going to do.’ We started by the idea of ‘if we build it, they will come.’ What we did is look at how can we translate what we know about the hardware and the software and turn it into something that will take over a market.”

The business started as three cubicles in his living room and a flight test hanger in his garage; the company’s first round of funding was $20,000 that they raised from friends and family.

“The future from here onward is about automation.”
– Dave Kroetsch, co-founder of Aeryon Labs

“When we launched our first product with that operator in mind instead of the pilot, what we saw were some challenges in the commercial market where we had directed the product. Commercial businesses didn’t really understand it, access to airspace was possible in Canada, but it was still a new thing to approach a survey company and say,’ you need to do aviation.’ They just didn’t know how to ingest it, but just as any good organic company does, you just follow the money,” he said

He believes there is a unique advantage of being a Canadian business building a drone company. While the team has access to airspace to build and test its product, US competitors have to fly in military test ranges in conditions that are very difficult to develop in. He mentions that US competitors are also encumbered by international trade and arms regulations because regulations are not caught up with technology.

“We were building a technology that looked a lot like a toy technology, but the US was encumbered by military restrictions. In Canada we didn’t have that, we were able to export to anywhere in the world. What had turned out is this thing that we built that was really easy to use, that we could export to solve some military problems for foreign customers,” said Kroetsch.

“We followed the money and got our first million dollar order from an overseas military customer, which allowed us to grow the product. We went from our first generation Scout, which we launched in 2009, to our subsequent product the Skyranger in 2013. This is where we’ve seen the product evolve from a basic thing that can fly and take a picture, to now cameras that can zoom and read a license plate from a thousand feet away or recognize a face.”

As a result of the proliferation of consumer drones in 2015, Aeryon Labs raised $60 million to expand the business and subsequently changed its story from just a hardware story the to software elements of the drone.

Kroetsch observed a lag in the focus on technology strategies, which is why he stepped down from his role as CEO and became the company’s CTO earlier this year.

With this change in the environment and new responsibilities, Kroetsch observed a lag in the focus on technology strategies, which is why he stepped down from his role as CEO and became the company’s CTO earlier this year.

Though Aeryon Labs has grown internationally with an office in Eastern Europe, employees in the US and Singapore, and 80 to 90 percent of business being exported outside of North America, the company plans to remain headquartered in the Waterloo region.

“The future from here onward is about automation. We started with a toy with joysticks, and now we have moved to an advanced drone that has a map that you can point and click. We now have cameras that allow you to automatically click on the bad guy running away, in the next level you start putting more AI and machine intelligence on the drone itself. You start putting more processors on board and that type of thing,” he said. “There are the challenges of course; the regulators aren’t quite ready yet for the ‘one too many control’, and all the complexities and liabilities associated with that, but this is certainly where we see the technology going.”

See the full episode here.

Aeman Ansari

Aeman Ansari

Aeman Ansari is a freelance writer who has been published in many Toronto-based publications, including Hazlitt and Torontoist. When she’s not re-watching Hitchcock movies, she’s working on her collection of short fiction inspired by stories from her grandmother, one of the few women in India to receive post-secondary education in English literature at the time.