Drone startup EHANG has scored a $42 million Series B to develop its technology and launch new products. Led by GP Capital, the round also included participation from returning investors GGV Capital, ZhenFund, and PreAngel, as well as Lebox Capital and OFC.
EHANG, the maker of app-controlled drone Ghost for consumer and industrial users, raised a Series A of $10 million in December. The company plans to launch its next generation of drones this year and says its newest capital will be used to develop new products and expand its app ecosystem.
“As a hardware company, product has always been the priority for us,””chief executive officer Huazhi Hu tells TechCrunch. There will be both industrial and consumer drones in our next generation products. We want to enhance our ability to transform advanced technology into mature products, as well as improve distribution channels and after-sale services through the funds.”
To support its growth plans, EHANG, which has offices in Guangzhou, Beijing, Shanghai, and San Francisco, recently filled four executive positions. Shang-wen Hsiao, the former president and chief financial officer of 21Vianet, a data services company, is now EHANG’s CFO and co-founder. Wei Qi, previously the vice president of Lenovo Group, was appointed EHANG’s senior vice president of operations and co-founder; Microsoft China former sales director of corporate and channel department Yijun Wang is its new vice president of sales; and Richard Liu, former vice president of finance at 21Vianet, now holds the same title at the drone startup.
As the market for commercial and consumer drones enjoys rapid growth, startups have scooped up significant venture capital funding. According to CB Insights, drone companies had raised $172 million by May 2015, more than the previous three years combined. EHANG’s rivals include 3D Robotics and DJI, both of which have also received significant venture backing (the latter even runs its own drone investment fund with Accel).
EHANG wants to differentiate by making its drones as easy to fly as possible. Ghost automatically follows users around or changes direction when they tilt their smartphones.
In a prepared statement, GP Capital representative Haoxiang Hou said “We truly believe that the smart control experience of [EHANG’s] drones can be more widely applied across market sectors and that the company can make a revolutionary breakthrough in UAV technologies.”
Since its Series A nine months ago, EHANG has more than doubled its employees to 150 and now sells Ghost in 70 countries. It hopes to build a stronger foothold in the U.S. by partnering with Hobbico, one of the country’s largest airplane model distributors. While EHANG is headquartered in China, Hu says its international user base will help it weather recent market turmoil.
“Our overseas consumers account for 60 percent of our global users and all of our financing funds are in U.S. dollars, which is a powerful backbone for us to face the domestic market crash.”