Author: azeeadmin

Merqueo, which operates a full-stack, on-demand delivery service in Latin America, has landed $50 million in a Series C round of funding.

IDC Ventures, Digital Bridge and IDB Invest co-led the round, which also included participation from MGM Innova Group, Celtic House Venture Partners, Palm Drive Capital and previous shareholders. The financing brings the Bogota, Colombia-based startup’s total raised to $85 million since its 2017 inception.

Merqueo CEO and co-founder Miguel McAllister knows a thing or two about the delivery space in Latin America, having also co-founded Domicilios.com, a Latin American food delivery company that was bought by Berlin-based Delivery Hero and later merged with Brazil’s iFood.

McAllister describes Merqueo as a “pure-play online supermarket with a fully integrated grocery delivery service” that sources directly from large brands and local suppliers, bypassing intermediaries and “delivering directly from its dark store network.” (Dark stores are traditional retail stores that have been converted to local fulfillment centers.”

Merqueo offers more than 8,000 products, including fresh foods, packaged goods, home essentials, beverages and frozen products. It currently operates in more than 25 cities in Colombia, Mexico and Brazil and has over 600,000 users.

Image Credits: Merqueo

It must be doing something right. The startup is close to $100 million in “run-rate revenue,” according to McAllister, having grown more than 2.5x in 2020. Merqueo also reached positive cash flow in Colombia, its most mature market. Over the last year, large Latin American retail chains and retailers have approached the company about potentially acquiring it, McAllister said.

Part of the company’s success might be attributed to the speed and flexibility it offers. Users can choose how and when to receive their groceries according to their needs, with the startup offering delivery in as little as 10 minutes or three to four hours. Users can also schedule delivery of their groceries in two-hour intervals for the same day or the next day.

Also, owning and controlling the “entire” vertical supply chain gives it the ability to obtain better margins, offer competitive pricing and achieve healthy unit economics, according to McAllister.

Merqueo plans to use its new capital in part to expand geographically. The company is currently in phase one of its expansion to Brazil, entering initially in Sao Paulo later this month. Next year, it expects to launch in other Brazilian cities such as Rio de Janeiro, Fortaleza and Salvador de Bahia.

The market opportunity in Latin America is massive considering that online grocery sales only represent just 1% of the market –– far lower than in the U.S., EU or China, for example. Other players in the increasingly crowded space include GoPuff in the U.S., Getir out of Turkey and Mexico-based Jüsto, which raised $65 million in a Series A led by General Atlantic earlier this year.

“The pandemic accelerated the adoption of online grocery shopping in LatAm,” McAllister told TechCrunch. “The region went from 0.3% share of online groceries to 1%. And after the pandemic, we are seeing a 50% increase in the pace of user adoption.” Overall, the $85 billion e-commerce market in Latin America is growing rapidly, with projections of it reaching $116.2 billion in 2023.

Currently, Merqueo has over 1,300 employees in LatAm, up 60% from last year. It plans to continue hiring with the proceeds from the Series C round as well work “to become the largest and most ambitious dark stores network of Latin America.”

Alejandro Rodríguez, managing partner at IDC Ventures, is naturally bullish on Merqueo’s potential.

“From all the opportunities we looked into, Merqueo is undoubtedly the most advanced in the region. … The Merqueo team has proved they know how to scale the business and how to get to profitability,” Rodríguez told TechCrunch.

Online grocery delivery is a business with many technical and operational complexities, he said. In his view, Merqueo’s technology and operational expertise allow it to tackle those issues in a way that has led to “the best customer experience that we have seen in a scalable way.”

“They have the best combination of both great service metrics and healthy unit economics,” Rodríguez added.

Uber wants to overcome the language barriers you’ll sometimes encounter when hailing a ride. The Verge says Uber has partnered with Rosetta Stone to offer free language lessons through its Driver app. Both Uber and Uber Eats drivers can use the feature to learn any of Rosetta Stone’s 24 languages. They’ll even get material tailored to common ridesharing scenarios.

Drivers will need to have reached Gold, Platinum or Diamond status through the Uber Pro program in a qualifying country (including large parts of the Americas, the UK, India and Spain).

The courses arrive alongside another career initiative. Drivers in some countries (including many of those from the Rosetta program) can request an achievements letter that will help them with job applications.

Uber wasn’t shy about the official rationale for both moves. Many of its drivers are either immigrants (and less likely to be familiar with local languages) or see languages and rideshare work as key to expanding their opportunities. Uber is aware that driving for the company might just be a “temporary stop” on a career path — this gives workers a better chance to move upward.

There are practical incentives for Uber. The more languages its drivers speak, the more likely those drivers are to get favorable ratings and encourage repeat business. The career incentives could also encourage more drivers to sign up for Uber in the first place, even if they ultimately spend less time in the role.

Editor’s note: This post originally appeared on Engadget.

DevOps is fundamentally about collaboration and agility. Unfortunately, when we add security and compliance to the picture, the message gets distorted.

The term “DevSecOps” has come into fashion the past few years with the intention of seamlessly integrating security and compliance into the DevOps framework. However, the reality is far from the ideal: Security tools have been bolted onto the existing DevOps process along with new layers of automation, and everyone’s calling it “DevSecOps.” This is a misguided approach that fails to embrace the principles of collaboration and agility.

Integrating security into DevOps to deliver DevSecOps demands changed mindsets, processes and technologies. Security and risk management leaders must adhere to the collaborative, agile nature of DevOps for security testing to be seamless in development, making the “Sec” in DevSecOps transparent. — Neil MacDonald, Gartner

In an ideal world, all developers would be trained and experienced in secure coding practices from front end to back end and be skilled in preventing everything from SQL injection to authorization framework exploits. Developers would also have all the information they need to make security-related decisions early in the design phase.

Once again, the reality falls short of the ideal. While CI/CD automation has given developers ownership over the deployment of their code, those developers are still hampered by a lack of visibility into relevant information that would help them make better decisions before even sitting down to write code.

The entire concept of discovering and remediating vulnerabilities earlier in the development process is already, in some ways, out of date. A better approach is to provide developers with the information and training they need to prevent potential risks from becoming vulnerabilities in the first place.

Consider a developer that is assigned to add PII fields to an internet-facing API. The authorization controls in the cloud API gateway are critical to the security of the new feature. “Shifting left and extending right” doesn’t mean that a scanning tool or security architect should detect a security risk earlier in the process — it means that a developer should have all the context to prevent the vulnerability before it even happens. Continuous feedback is key to up-leveling the security knowledge of developers by orders of magnitude.

If you have an older Amazon Kindle with 3G internet, take note that you may not be able to wirelessly access and download new content anymore starting in December. As The Verge reports, Amazon has sent out emails to owners with old Kindles, telling them that previous-generation devices will lose internet access after mobile operators transition from 2G and 3G networks to 4G and 5G.

The e-commerce giant listed the particular devices that will be affected by the switch in its FAQ page. It noted that the first- and second-generation Kindles, as well as the Kindle DX, won’t be able to connect to the internet at all since they don’t have WiFi connectivity to fall back on. The other devices in the list are the Kindle Keyboard (3rd Generation), Kindle Touch (4th Generation), Kindle Paperwhite (5th, 6th and 7th Generation), Kindle Voyage (7th Generation) and Kindle Oasis (8th Generation), all of which have WiFi connection.

You’ll still be able to access your books on an older device and can do wired transfers if you want, though. And if you have a newer 4G or WiFi-only Kindle, you won’t be affected at all. In its email, Amazon included a code customers can use to get $50 off a new Kindle Paperwhite or Oasis, along with $15 in eBook credits. You may want to check your inbox to see if you got the company’s notice in case you’ve been looking to upgrade anyway.

Editor’s note: This post originally appeared on Engadget.

If you’re an early-stage founder, you’d be wise to make TechCrunch Disrupt 2021 (September 21-23) your must-attend virtual destination. It’s the OG of tech startup conferences, draws more than 10,000 attendees from around the world and features some of the most gifted, visionary minds and makers across the entire tech spectrum.

Cash-strapped founders in the early innings of their startup love to save money, and we get it in a big way. That’s why our Founder pass is the perfect choice for you. Right now, you can buy a Founder Pass for $79 but the clock is ticking on this early bird deal. It flies away — and prices go up — on July 30 at 11:59 pm (PT).

The price might be small, but a Founder pass provides full access to Disrupt programming — more than 100 hours of live content and three months of video-on-demand access. You’ll connect and network with thousands of Disrupt attendees, strike up ad hoc conversations in the virtual platform’s chat feature and use CrunchMatch to set up private 1:1 meetings with potential customers, investors or employees.

Watch the Startup Battlefield, explore hundreds of early-stage startups exhibiting in the Startup Alley expo area and take full strategic advantage of the free, three-month Extra Crunch membership that comes with your Founder pass.

Of course, we think attending Disrupt is a no-brainer, but check out what these early-stage founders told us about their Disrupt experiences.

“Disrupt is laser-focused on startups. I’m just starting my own company and attending Disrupt was an incredible opportunity to connect with companies and learn from the best people in the industry.” — Anirudh Murali, co-founder and CEO, Economize.

“My top three benefits of going to Disrupt were introducing my product to people who would not have seen it otherwise; networking with investors, mentors, advisors and potential customers and, finally, talking to other entrepreneurs and founders and learning what it took to get their companies off the ground.” — Felicia Jackson, inventor and founder of CPRWrap.

“Disrupt gave our company and technology invaluable exposure to potential customers and partners that we would not have met otherwise. A company that does 15 billion in annual sales thinks our tech is a fit for their ecosystem, and we’re excited to continue building that relationship.” — Joel Neidig, founder of SIMBA Chain.

Take a few minutes and peruse the Disrupt 2021 agenda. Don’t miss out on Startup Battlefield or any of the pitch feedback sessions — they’re great opportunities to learn what investors look for in a pitch. The pitch(deck) you improve could be your own.

TechCrunch Disrupt 2021 takes place on September 21-23, but time is running out for you to buy a Founder Pass for only $79. Prices go up when the early-bird deal expires on July 30 at 11:59 pm (PT).

Is your company interested in sponsoring or exhibiting at Disrupt 2021? Contact our sponsorship sales team by filling out this form.

La Haus, which has developed an online real estate marketplace operating in Mexico and Colombia, has secured $100 million in additional funding, including $50 million in equity and $50 million in debt financing.

The new capital was obtained as an extension to the company’s Series B, the first tranche of which closed in January. With the latest infusion, Medellin, Colombia-based La Haus has now secured $135 million total for the round and over $158 million in funding since its 2017 inception.

San Francisco Bay Area venture firms Acrew Capital and Renegade Partners co-led the round, which also included participation from Jeff Bezos’ Bezos Expeditions, Endeavor Catalyst, Moore Strategic Ventures, Marc Benioff’s TIME Ventures, Rappi’s Simon Borrero, Maluma, and Gabriel Gilinski. Existing backers who put money in this round include Greenspring Associates, Kaszek, NFX, Spencer Rascoff’s 75 & Sunny Ventures, Hadi Partovi and NuBank’s David Velez. 

Jerónimo Uribe (CEO), Rodrigo Sánchez-Ríos (president), Tomás Uribe (chief growth officer) and Santiago Garcia (CTO) founded the company after Jerónimo and Tomas met Sánchez-Ríos at Stanford University. Prior to La Haus they started and ran Jaguar Capital, a Colombian real estate development company with over $350 million of completed retail and residential projects. 

The company declined to reveal at what valuation the extension was raised, with Sánchez-Ríos saying only that it was “a significant increase” from January.

The Series B extension follows impressive growth for the startup, which saw the number of transactions conducted on its Mexico portal climb by nearly 10x in the second quarter of 2021 compared to the 2020 second quarter. With over 500 homes selling on its platform (via lahaus.com and lahaus.mx) the company is “the market leader in selling new housing in Spanish-speaking Latam by an order of magnitude,” its execs claim.  La Haus expects to have facilitated more than $1 billion in annualized gross sales by the end of the year. 

The startup was founded with the mission of making it easier for people to buy homes and helping “solve LatAm’s extreme housing inequality.” Its end goal is to accelerate access to new housing by both generating and curating supply and demand and then matching it with its technology, noted Sánchez-Ríos. 

“In the last six months, our chief product officer has built a product that allows this to happen 100% digitally,” he said. “Before it would take a lot of time, people involved and visits. We want to provide people looking for a home a similar experience as to people looking for their next flight at delta.com.”

It has done that by embedding its software to developers’ new projects so that it can bring that digital experience to its users. 

“They are able to view the projects on our sites, we match them and then they can see in real time which units of a particular tower are available, and then select, sign and pay for everything digitally,” Sánchez-Río said.

Image credit: La Haus

The need for new housing in the region and other emerging markets in general is acute, they believe. And the pace of building new homes is slow because small and mid-sized developers – who are responsible for building the majority of new homes in Latin America – are cash constrained. At the same time, mortgages are mostly not affordable for consumers, with banks extending only a fraction of the credit to individuals compared to the U.S., and often at far worse terms. 

What La Haus is planning to do with its new capital – particularly the debt portion – is go beyond selling homes via its marketplace to helping extend financing to both developers and potential buyers.It plans to take the proprietary data it has been able to glean from the thousands of real estate transactions conducted on it platform to extend capital to developers and consumers “more quickly, with much lower risk and at better terms.”

Already, what the startup has accomplished is notable. Being able to purchase a home 100% digitally is not that easy even in the U.S. Pulling that off in Latin America – which has historically trailed behind in digital adoption – is no easy feat. By year’s end, La Haus intends to be in every major metropolitan area in Mexico and Colombia. 

Its ultimate goal is to be able to help new, sustainable homes “to be built faster, alleviating the inequality caused by lack of access to inventory.”

To Acrew Capital’s Lauren Kolodny, La Haus is building a solution specific to the issues of Latin America’s housing market, rather than importing business models – such as iBuying – from the U.S.

“For many people in the United States home equity is their largest asset. In Latin America, however, consumers have been challenged with an impenetrable real estate market stacked against consumers,” she wrote via email. “La Haus is removing barriers to home ownership that stifles millions of people from achieving financial security. Specifically, Latin America has no centralized MLS, very costly interest rates, no transactional transparency, and few online informational tools.”

La Haus, Kolodny added, is breaking down these barriers by consolidating listings online, offering pricing transparency and educating consumers about their financing options.

Acrew first invested in the startup in its $10 million Series A and has been impressed with its growth over time.

“They have a unique focus on new housing — a massive industry worldwide, but especially in emerging markets where new housing is so necessary,” Kolodny said. “The management team…knows real estate in Latin America better than anyone we’ve met.”

For its part, the La Haus team is excited to put its new capital to work. As Sánchez-Río put it, “$50 million goes a lot further in Mexico and Colombia than in the U.S.”

“We are going to be very aggressive in Mexico and Colombia, and plan to go from four to at least 12 markets by the end of the year,” Jeronimo told TechCrunch. “We’re also excited to roll out our financing solution to developers and buyers.”

Facebook’s booming business is dominated by digital ads, but it also has hardware ambitions beyond VR. During the company’s latest earnings call, CEO Mark Zuckerberg said its next product release would be a pair of smart glasses from Ray-Ban.

“The glasses have their iconic form factor, and they let you do some pretty neat things,” the Facebook co-founder said. “So I’m excited to get those into people’s hands and to continue to make progress on the journey toward full augmented reality glasses in the future.”

Facebook’s sunglasses have been the subject of rumors since 2019. Back then, sources told CNBC that Facebook was working with Ray-Ban owner EssilorLuxottica on AR eyewear nicknamed “Orion.” The glasses were billed as a full-fledged phone replacement on which you could take calls, see information and even broadcast livestreams. That inevitably drew comparisons to Google Glass (another Luxottica collab) instead of the phone-tethered Spectacles from Snap. Last year, Hugo Barra, then VP VR at Facebook Reality Labs, confirmed that the glasses would land in 2021. But, we haven’t heard much since.

For Facebook, the glasses hold the key to its future. Alongside virtual reality, augmented reality (AR) is integral to building the “metaverse,” Zuckerberg said. In the future, Facebook will morph into a shared, liveable platform that lets you “teleport” between different social experiences using VR and AR, Zuckerberg explained.

The term metaverse is the latest buzzword seized upon by Silicon Valley and futurists. While the concept has been around for well over a decade, it gained traction after the breakout success of multiplayer game creation platforms like Fortnite and Roblox. Earlier this week, Microsoft chief Satya Nadella mentioned an “enterprise metaverse” on his company’s earnings call.

For Facebook, the metaverse is more than just a fad. The company is spending billions in order to build its shared universe, which will be populated with Facebook users and digital ads, according to Zuckerberg. In order for it to become a reality, the company needs more people to buy its computing hardware. Therefore, the plan is to make those devices more affordable.

“Our business model isn’t going to primarily be around trying to sell devices at a large premium or anything like that because our mission is around serving as many people as possible,” Zuckerberg noted. “So we want to make everything that we do as affordable as possible, so as many people as possible can get into it and then compounds the size of the digital economy inside it. So that’s kind of at a high level how I’m thinking about this.”

Sunglasses aren’t the only hardware Facebook is reportedly working on. Multiple reports have claimed Facebook is developing a smartwatch with a built-in cellular connection and a detachable display. Initially, it was believed that the watch would be first out the gate, but it seems Zuckerberg had other plans.

Editor’s note: This post originally appeared on Engadget.

Industrial robotics are big and heavy — and in some cases, legitimately dangerous. They’re also extremely difficult to train — particularly if you plan to implement them for tasks outside of their purpose-built intentions.

There’s huge opportunity for the right AI/software company to come along and help make the bulky systems intended for things like auto manufacturing easier to program and more versatile. Honestly, there’s probably enough room to support multiple companies in the category as robots become an increasingly essential part of how we do business.

This week we saw a pair of big news stories from companies operating in that space. On Tuesday, Covariant announced an $80 million raise — a quick follow-up to the $40 million Series B it announced in May 2020.

Image Credits: Covariant

I spoke to president, chief scientist and co-founder (and recurring TC Sessions: Robotics guest) Pieter Abbeel for the piece, which you can check out here. I further picked the long-time UC Berkeley professor’s brain about some broader robotics trends.

We’ve seen a marked increase in investment activity around robotics and automation since the beginning of the pandemic. Do you anticipate that this interest will maintain?

It won’t just maintain. It’ll continue to accelerate on a dramatic scale. The demand isn’t new but the pandemic has certainly increased demand for resilient and robust robotics. COVID-19 accelerated a timeline that was already in motion. Other factors that contribute to the momentum include the rise of e-commerce replacing in-store purchases along with Amazon’s strive for efficiency. They’ve raised consumer expectations of fast delivery across the board and making good on that promise often starts with warehouse automation.

As someone with experience in both an educational setting and a startup, how have universities’ approach to incubating companies evolved. What more can and should be done to foster entrepreneurship?

With AI the transition from research to practice has been exceptionally fast. An idea could be published today, and many companies might be implementing it into their systems the next day. This trend has made AI researchers uniquely positioned to build new applications (compare this to, let’s say, Airbnb, Uber, food delivery companies, etc., which were not enabled by research advances, but by everyone having a smartphone, enabling a new model of doing business).

Structurally, one clear change at many universities is the introduction of artificial intelligence across many programs. A great example is “The Business of AI” course, which I co-teach in the Haas Business School at Berkeley, and which gives business students a solid understanding of the role of AI today, as well as trends and what the future might bring.

To foster more entrepreneurship in the U.S., leadership should consider how many international students are also the leading AI researchers. A faster visa/green card process for entrepreneurs would have a very high impact.

Do you foresee continuing to teach, as Covariant grown?

Yes. I see a very strong synergy between being at the forefront of academic AI research at Berkeley and being at the forefront of industrial R&D bringing AI Robotics into the real world as chief scientist at Covariant. The culture our CEO Peter Chen has fostered at Covariant also has great alignment with this; curiosity and lifelong learning are core values at Covariant.

How actively does your team consider biases in its AI work?

Bias in AI systems is of course a broader industry issue and is on the minds of our team members. As of today, bias in AI systems doesn’t directly play a role in our current robotic warehousing efforts. However, quality assurance more generally is core to everything we do, and quality assurance isn’t a one-axis thing, we have to consider quality and coverage of various data sources and performance across SKUs, warehouses, customers, etc. In that sense, there are actually many technical parallels.

It seems like most of the activity on the industrial robotics front is happening on the software/AI side. Are robotics manufacturers continuing to evolve their hardware as software improves?

Indeed, while we largely focus on the software/AI ourselves, we work with amazing partners to deliver fully functioning robotic systems. In doing so, we see continual improvement on the hardware as well. Most visible over a short time period are continual changes in end-of-arm tooling. In addition, we see interesting multiyear roadmap ideas in robotic arm form factors that take more R&D and design effort to bring to market.

Image Credits: Gramazio Kohler Research, ETH Zurich

The other big news of the week is the unveiling of Intrinsic, Alphabet’s most recent robotics play. Or, I guess I should say, most recently announced robotics play. The Alphabet X spinout has apparently been in the works for about five years now. It follows a fairly uneven robotics track record for Alphabet/Google that involved brief ownership of Boston Dynamics. But the company’s offering seems much more in-line with what Google excels at.

Here’s Intrinsic CEO, Wendy Tan-White, who most recently served as Alphabet’s VP of Moonshots:

Over the last few years, our team has been exploring how to give industrial robots the ability to sense, learn and automatically make adjustments as they’re completing tasks, so they work in a wider range of settings and applications. Working in collaboration with teams across Alphabet, and with our partners in real-world manufacturing settings, we’ve been testing software that uses techniques like automated perception, deep learning, reinforcement learning, motion planning, simulation and force control.

Image Credits: Agility

Closing the week’s roundup with a pair of athletic ‘bots. First is the return of Cassie, Oregon State University’s bipedal robot. Cassie took a bit of a backseat to OSU spinoff Agility’s delivery robot, Digit, but the school is continuing to do interesting things with the platform. A team of research helped teach the robot to run, using a a deep reinforcement learning algorithm.

In fact, Cassie managed to run a 5K in 53 minutes. Not great by human standards, but extremely solid for a robot using a single battery, particularly when you factor in the 6.5 minutes of troubleshooting an overheated computer and a poorly maneuvered turn.

Outside Olympians and T-shirt vendors, Toyota may well have been the most disappointed about the initial decision to delay the summer Olympics. The automotive giant clearly envisioned the Tokyo games as an ideal opportunity to showcase its technology for the world.

Now that the games are on, the company’s basketball robot CUE is back in a big way. After debuting in 2018, CUE returned to sink three-pointers during half-time at the USA-France game.

Air taxis may still be pie in the sky, but there’s more than one way to move the air travel industry forward. Craft Aerospace aims to do so with a totally new vertical-takeoff and landing aircraft that it believes could make city-to-city hops simpler, faster, cheaper, and greener.

The aircraft — which to be clear is still in small scale prototype form — uses a new VTOL technique that redirects the flow of air from its engines using flaps rather than turning them (like the well-known, infamously unstable Osprey), making for a much more robust and controllable experience.

Co-founder James Dorris believes that this fast, stable VTOL craft is the key that unlocks a new kind of local air travel, eschewing major airports for minor ones or even heliports. Anyone that’s ever had to take a flight that lasts under an hour knows that three times longer is spent in security lines, gate walks, and of course in getting to and from these necessarily distant major airports.

“We’re not talking about flying wealthy people to the mall — there are major inefficiencies in major corridors,” Dorris told TechCrunch. “The key to shortening that delay is picking people up in cities, and dropping them off in cities. So for these short hops we need to combine the advantages of fixed wing aircraft and VTOL.”

The technique they arrived at is what’s called a “blown wing” or “deflected slipstream.” It looks a bit like something you’d see on the cover of a vintage science fiction rag, but the unusual geometry and numerous rotors serve a purpose.

The basic principle of a blown wing has been explored before now but never done on a production aircraft. You simply place a set of (obviously extremely robust) flaps directly behind the thrust, where they can be tilted down and into the exhaust stream, directing the airflow downwards. This causes the craft to rise upwards and forwards, and as it gets enough altitude it can retract the flaps, letting the engines operate normally and driving the craft forwards to produce ordinary lift.

During takeoff, thrust is redirected downwards by extending flaps.

The many rotors are there for redundancy and so that the thrust can be minutely adjusted on each of the four “half-wiings.” The shape, called a box wing, is also something that has been tried in limited fashion (there are drones with it, for example) but ultimately never proved a valid alternative to a traditional swept wing. But Dorris and Craft believe it has powerful advantages in this case, allowing for a much more stable, adjustable takeoff and landing than the two-engine Osprey. (Or indeed many proposed or prototype tilt-rotor aircraft out there.)

During flight, the flaps retract and thrust pushes the plane forward as normal.

“Our tech is a combination of both existing and novel tech,” he said. “The box wing has been built and flown; the high flap aircraft has been built and flown. They’ve never been synthesized like this in a VTOL aircraft.”

Again, to be clear, the company has demonstrated a limited scale model that shows the principle is sound — they’re not claiming there’s a full-scale craft ready to go. That’s years down the line, but willing partners will help them move forward.

The fifth generation prototype (perhaps the size of a coffee table) hovers using to the blown wing principle, and the sixth, due to fly in a few months, will introduce the transitioning flaps. (I was shown a video of the prototype doing tethered indoor hovering but the company is not releasing this test footage publicly.)

The design of the final craft is still in flux — it’s not known exactly how many rotors it will have, for instance — but the basic size, shape, and capabilities are already penned in.

It’ll carry 9 passengers and a pilot, and fly around 35,000 feet or so at approximately 300 knots, or 345 mph. That’s slower than a normal passenger jet, but whatever time you lose in the air ought to be more than regained by skipping the airport. The range of the cleaner hybrid gas-electric engines should be around 1,000 miles, which gives a good amount of flexibility and safety margins. It also covers 45 of the top 50 busiest routes in the world, things like LA to SF, Seoul to Jeju Island, and Tokyo to Osaka.

It probably wouldn’t be flying at this altitude.

Notably, however, Dorris wants to make it clear that the idea is not “LAX to SFO” but “Hollywood to North Beach.” VTOL aircraft aren’t just for show: regulations permitting, they can touch down in a much smaller location, though exactly what kind of landing pad and micro-airport is envisioned is, like the aircraft itself, still being worked out.

The team, which has just worked its way through Y Combinator’s summer 2021 cohort, is experienced in building sophisticated transport: Dorris was a primary on Virgin Hyperloop’s propulsion system, and his co-founder Axel Radermacher helped build Karma Automotive’s drivetrain. It may not have escaped you that neither of those companies makes aircraft, but Dorris thinks of that as a feature, not a bug.

“You’ve seen what’s come out of traditional aerospace over the last 10, 20 years,” he said, letting the obvious implication speak for itself that the likes of Boeing and Airbus aren’t exactly reinventing the wheel. And companies that partnered with automotive giants hit walls because there’s a mismatch between the scales — a couple hundred aircraft is very different from half a million Chevy sedans.

So Craft is relying on partners who have looked to shake things up in aerospace. Among its advisors are Bryan Berthy (once Director of Engineering at Lockheed Martin), Nikhil Goel (one of Uber Elevate’s co-founders), and Brogan BamBrogan (early SpaceX employee and Hyperloop faithful).

The company also just announced a letter of intent from JSX, a small airline serving low-friction flights on local routes, to purchase 200 aircraft and the option for 400 more if wanted. Dorris believes that with their position and growth curve they could make a perfect early partner when the aircraft is ready, probably around 2025 with flights beginning in 2026.

It’s a risky, weird play with a huge potential payoff, and Craft thinks that their approach, as unusual as it seems today, is just plainly a better way to fly a couple hundred miles. Positive noises from the industry, and from investors, seem to back that feeling up. The company has received early stage investment (of an unspecified total) from Giant Ventures, Countdown Capital, Soma Capital, and its advisor Nikhil Goel.

“We’ve demonstrated it, and we’re getting an enormous amount of traction from aerospace people who have seen hundreds of concepts,” said Dorris. “We’re a team of only 7, about to be 9 people… Frankly, we’re extremely pleased with the level of interest we’re getting.”