Introduction
Drones still seem like something out of a science fiction movie, but unmanned aerial systems are closer to widespread adoption than some might realize. Drones may even have the potential to improve society. In particular, drones have huge potential to revolutionize last-mile delivery for the exploding e-commerce industry.
Skycart hopes to be at the forefront of drone technology for both humanitarian and delivery applications. The company’s current objective is distributing lifesaving medical products to remote areas in Africa. We reached out to company founder, Chief Executive Officer, and Technical Officer Simon Yuen to learn about how he developed a passion for aircraft and why he decided to use drones to save lives.
Note: This interview was conducted over phone and email. It has been lightly edited for clarity and length.
Can you give us a brief elevator pitch for your company?
Skycart develops drones to make the costly “last mile” of delivery affordable and to replenish hard-to-reach health facilities with life-saving medical supplies.
What inspired you to take the leap and build this company?
After taking a trip to investigate the condition of the healthcare system in Kenya with a friend, I saw first-hand how pervasive the underdeveloped road infrastructure is in Africa and how drones can help solve many of the healthcare issues resulting from it. The health facilities we visited were out of nearly all supplies they needed to treat patients. A doctor told us that supply shortages were caused by transportation challenges and that during times of emergency, they face greater challenges to keep their patients alive. This was solid confirmation for me that health facilities needed drones to resupply them with critical medical supplies and help bridge the infrastructure gap so that lives can be saved. We spoke to the doctor about how we could use drones to resupply them, and he got excited and wanted to start the resupply operation right away.
What past experiences prepared you to start, build, and lead your company?
As a child, I was fascinated with aircraft and would stare out the airport window to watch them. I grew up wanting to be a pilot but took an electrical engineering path due to its popularity. During my engineering career, I had the opportunity to own small businesses and run them with partners. Having missed an opportunity in aviation combined with an entrepreneurial spirit, I have started Skycart to live my passion and develop aircraft to improve peoples’ lives.
What is your vision for the future of the industry you are operating in?
Our vision is to enable people to receive their purchases in 30 minutes or less with Skycart’s instant delivery service. By 2025, drones will deliver 13% of all commercial goods (500 million deliveries) to consumers. We also plan to build out more capabilities to serve a larger customer base. For example, we plan to develop plane-size cargo drones in the future that will connect whole countries to the global trade network!
Who is on your team and how did you come together?
Our team comprises mostly engineers — from software to hardware development — that have a passion for drones and technology. This is because our drones are sophisticated, and their development requires expertise in multiple engineering disciplines. We also have advisors and team members in business development, marketing, and sales. Some of us found each other over social platforms for entrepreneurs and some applied to positions as interns.
Do you have any competition, if so, how do you differentiate?
Our patented delivery system technology is the main differentiator and has a demonstrable impact on customers and stakeholders by delivering four packages in one trip. We also bring competitive advantages in three main areas:
(I) Customers: 20% cost saving per kilometer compared to other drone competitors, 52.5% reduction in the number of unused drones at drone hub’s, and up to 75% reduction in costs associated with component replacement.
(II) Regulators: Reduction in drone traffic in the skies by up to 75%, helping to combat drone congestion concerns.
(III) Competitive Landscape: Our main competitor (Competitor I) is operating in at least three countries and has a lot of investor backing. Our secondary competitor (Competitor II) is operating in at least two countries.
- Skycart has patented multi-delivery technology that allows us to expand our delivery capability while Competitor I and Competitor II has not.
- Skycart drones do not require complex droneport infrastructure to function compared to Competitor I.
- Skycart drones can make multiple deliveries between destinations while Competitor I cannot.
- Skycart drones make the biggest impact to reduce the cost of system ownership, the cost of package delivery, and congestion in the sky, while Competitor I and Competitor II do not.
- Skycart drones are capable of heavier payloads at 15 kilograms versus Competitor I and Competitor II at 6 kilograms.
- Skycart multi-delivery drones reduce more greenhouse gas emissions compared to Competitor I and Competitor II.
What does your business model look like?
Master service agreements are structured and priced according to a per-mile basis. The customer agrees to pay for a minimum number of delivery miles upfront, and any overages will cost them extra. Our software tracks delivery mileage and bills the customer accordingly. The customer pays this bill at the end of an agreed to period, whether it’s per month, quarter, or year.
What brought you to equity crowdfunding and how do you intend to use the money you raise this round to scale the business?
We decided to do a public crowdfunding round after receiving so many requests from our supporters. We don’t know if we will do another in the future. We expect to skyrocket to venture capital territory after this offering! It’s quite possible that this current offering will be the only chance for non-venture investors to own a piece of Skycart before we take off.
53% of the funds raised will go toward hiring instrumental team members to push research and development efforts, such as advancements in our cloud software and inventory management systems. 36% of the funds raised will go towards manufacturing, maintenance, and drone insurance.
What do you want potential investors to know about you and/or your company?
People believe that humanitarian initiatives are the responsibility of charities. Skycart likes to challenge that belief and prove that businesses can be built around helping people.
As you think about the business 5-10 years down the road, what do you see exit opportunities looking like? Have you set any future goals for the company?
Going public is a possibility for Skycart. There are also plenty of suitors that may want to acquire the company in the future. However, we are focused on building something massive, impactful, and being the leaders of our industry together with our investors. While we achieve these objectives, exit opportunities including going public will present themselves. When they do, we can decide what course of action to take together.
We look forward to seeing where Simon and his team take the company. Skycart is currently raising on Wefunder.
