PrecisionHawk bankruptcy

PrecisionHawk, once a drone giant, declares bankruptcy

PrecisionHawk, which at one point was one of the biggest drone industry giants is no more. The company, known for using drones to capture agricultural data, filed for Chapter 7 bankruptcy in mid-December 2023. As opposed to a Chapter 11 bankruptcy, Chapter 7 bankruptcy means PrecisionHawk will cease operations. The company will also close down its headquarters in downtown Raleigh, North Carolina.

“The company did not have sufficient capital to maintain operations,” Jason Hendren told the News & Observer, a newspaper serving the Raleigh, North Carolina area. Hendren is a bankruptcy attorney in Raleigh who is representing PrecisionHawk

According to its bankruptcy filings, the company owes $242,667 in unpaid rent on its headquarters. That debt is only a tiny fraction of the $17.5 million worth of debt it holds, according to its bankruptcy filing. The company has just around $3.8 million in assets, which a court-appointed trustee will be responsible for using to pay creditors. Though, unsecured creditors should expect to get nothing out of the filing,

Most of the company’s employees have posted “Open to Work” badges on their LinkedIn profiles.

Photo courtesy of PrecisionHawk

A history of PrecisionHawk

It’s been a tumultuous year for the company, which at one point was among the darlings of the drone industry. Founded in 2010, it touted clients including five of the top 10 utility companies, the largest provider of communications infrastructure in the United States, and the “Big Six” providers of seed and agricultural chemicals.

Through its history. PrecisionHawk made some pivots to its business model. It initially leaned into being a drone manufacturer, before later focusing on drones for remote sensing applications and data processing. It focused on enterprise use cases such as agriculture, energy, solar, oil & gas, and telecom.

And it had scored some strong wins, notably when DJI announced it would drop PrecisionHawk-competitor AirMap and replace it with PrecisionHawk as its new provider of airspace data in North America. With that 2018 change, PrecisionHawk became the geofencing technology provider behind DJI’s drones. Drone geofencing is a technology pioneered by DJI that creates a virtual “fence” around areas where it doesn’t want its drones flying, such as near airports.

It also had significant government influence. For example, then-CEO Michael Chasen served as the Chairman for the FAA’s Drone Advisory Committee (DAC).

Across its Series A through E funding rounds, PrecisionHawk raised more than $136 million. That included $10 million from Intel Capital in it series B, and a hefty $32 million series E in 2019. The year prior, it raised an even bigger $75 million.

But especially in the past year, it’s become clear that PrecisionHawk was having trouble. Most of that new came to light shortly after Norway-based UAV inspection and mapping company Field acquired PrecisionHawk in March 2023.

At the time, Field saw the PrecisionHawk acquisition as an opportunity to expand to the U.S. market. Field stated that it would use PrecisionHawk’s artificial intelligence and drone technology company for infrastructure management with its clients, which included multiple Fortune 500 companies. In a March 2023 press release sharing news of the acquisition, the company stated that PrecisionHawk would keep its Raleigh headquarters and operate under the Field brand by the end of the year.

Instead, Field announced in October 2023 that it would close the PrecisionHawk office in Raleigh, North Carolina.

“We knew it would be a challenge to make PrecisionHawk profitable in the short term,” said Krister A. Pedersen, who stepped in as interim CEO of Field in September 2023 after former CEO Cato Vevatne stepped down. “Despite our best efforts, we couldn’t turn it around in time, and we have had to close the office.”

Field’s Explorer UAV. (Photo courtesy of Field)

What’s next for PrecisionHawk and what will fill its void?

As for what’s next for PrecisionHawk, the Meeting of Creditors is set for Jan. 24, 2024. Field Group, which acquired PrecisionHawk, in itself will be starting somewhat anew in 2024. That includes new ownership after being acquired by existing shareholders.

While certain investors will acquire Field Group’s traditional business, former Field Board Chair Arild Austigard and partners are set to acquire Field Group’s drone activity. With that major change comes a full refinancing of the business in a new company structure.

Field’s UAV division will continue working on unmanned technology and inspection services. Though, they will operate under a new entity and a new brand.

“I am pleased that we have found a solution for Field Group where we can take over the ownership of the drone activities in the company,” Austigard said in a prepared statement. “The use of drones is part of the future solution that both ensures efficient solutions and the environmental challenges we face, and the employees in Field Group working in the drone business have what it takes to succeed in the future.”

As far as what other companies might fill the void set by the end of PrecisionHawk? Other companies that offer similar services to PrecisionHawk include San Francisco-based DroneDeploy, which builds software to automate flight and data capture. With DroneDeploy, users generate interactive maps, orthomosaics and 3D models.

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