Microsoft Ventures Makes Investment In Drone Startup

Microsoft Ventures, the venture capital (VC) arm of the Redmond, Wash.–based software giant, led a $26 million venture round in AirMap, a drone startup that is the main maker of software that manages air traffic for drones.

According to AirMap, its real-time traffic management software is used by about 80 percent of all drones around the globe. Other investors that took part in the round of fundraising included Airbus, Qualcomm, Sony, Rakuten and Yuneec, China’s leading drone maker.

Microsoft Ventures said that, with the investment, AirMap can use Microsoft’s software and artificial intelligence tools. The investment also gives Microsoft an entrance into the drone aviation market, which is dominated by the likes of Amazon and Alphabet’s Google.

Microsoft’s decision to get into the drone market comes at a time when companies are in a race to become big players in what is expected to become a huge market opportunity for a slew of industries, from delivery companies like UPS to software makers such as Microsoft. Amazon, a pioneer in drones, sees unmanned aerial aircraft as the perfect way to get packages in the hands of customers who are used to instant gratification.

In a report in Fortune, Nagraj Kashyap, head of Microsoft Ventures, said the investment marks the first time Microsoft’s VC arm has made an investment in drone startup. The fund debuted in May. Kashyap suggested that Microsoft could benefit by supplying the cloud-based infrastructure needed for startups like AirMap to deliver their software services to customers. The Fortune report noted that AirMap has garnered a lot of interest from the drone and aviation markets because its technology enables drone pilots to know flight conditions and rules governing local and national airspace.