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Nov 20, 2020 | InterDrone Interview

InterDrone Interview: Ware CEO Ian Smith talks about using drones for warehouse automation

Sometimes you meet people and you instinctively know that they’ll go far in their careers. Ian Smith is no exception. I first met him when he launched and grew DroneDeploy’s App Market. He also found time to run one of the most successful drone-related podcasts, where he regularly interviewed leaders at firms making an impact in the space. Now, as CEO and co-founder of Ware, he’s using a recent round of seed funding to grow the company and streamline the $1.9 trillion warehouse automation industry.

I got a chance to catch up with Ian and find out how he came up with Ware, the reason they’re using only Skydio 2 drones, and why any operation with a warehouse needs to try it out.

You and I met at DroneDeploy, where you made quite an impact developing its App Market. Tell me a little bit more about your background.

I started my career professionally as a commercial helicopter pilot and flight instructor. Because I was a new flight instructor in 2008, when there was a financial crisis, I pivoted to jet fuel brokerage serving Fortune 500 companies (at UVair) for about four years.

I grew up flying model aircraft with my Dad, who works at NASA, on the campus in Houston. They would have small little gas-powered engines. We’d fly these little airplanes around and if you crashed it, you’d have to rebuild the whole thing. It would take a week or two, or more. Fast-forward to 2013, I’m in my car and I’m listening to this NPR story that starts off saying “drones! People are using these to make money, and it’s legal.”

At that point, I realized that this technology has come far since I was a kid. They had autopilot, GPS, onboard processing. That’s when I decided to work in the drone industry. I started at DELAIR, followed by DroneDeploy for almost 4 years. I started the Commercial Drones FM podcast. It hasn’t been as active, lately, because I’ve been derailed with my current schedule.

Before Ware, I spent a year as a General Manager of an eCommerce store called tink. We sold smartphone stuff. It’s a German startup and I was in charge of bringing it to the U.S. I got my first taste of fulfillment, logistics, inventory, and warehousing. I faced all these new challenges and it opened my eyes to warehousing and hence my interest in understanding the building blocks to solving the inventory tracking problem inside of warehouses.

I realized drones were the best solution, which is basically the whole premise of Ware.

Most warehouses are indoors. It must be a relief to be exempt from FAA regulations on that front. How do deal with outdoor facilities?

We actually don’t. We completely avoid them. That’s by design. We love the fact that we’re not beholden to FAA regulations – especially because we’re conducting regular beyond-visual-line-of-sight (BVLOS) flights, autonomously, in the warehouses at scale. This is happening every single day.

If it’s outdoors and we have to work with the FAA, we avoid it because for our specific product, we don’t think the ROI is there yet. Under these conditions, presently, you have to have a human pilot that is Part 107-certified and has a waiver to fly BVLOS. This is why we won’t focus on outdoor usage just yet.

Are there any other business-related challenges that have emerged?

By virtue of working on this problem, no one has really done this before successfully. So we’re really thinking outside of the box in terms of “how do we deploy this?” We’ve conducted evaluations with paid customers but we definitely need to work more towards doing that at scale. We don’t have a robust process yet.

We’re doing it in a way that no one else has done it before in terms of warehouse automation technology robotics as a whole. Typically, what you do when you’re a warehouse operator, if you want to acquire robotics or automation technology is you have a person on site giving a demo. There are a ton of logistics involved with getting the equipment there. The entire on boarding process can take up to six months.

Take, for example, DroneDeploy. Sign up free, trial it, download the map. You’re done. How do you trial warehouse drones? Without making it a huge undertaking, what we do is we deploy the drones, fully, remotely. This was spurred on by COVID. It actually accelerated the pace we were working towards this [process]. Now we’ve sold and deployed drones at customer sites where we’ve never been.

Now we do the whole thing remotely, send the drone in the mail. The customer receives it, presses the button, the drone flies itself. That allows us to help proliferate the technology further, faster. We can have ten, twenty, thirty, even forty at the same time running in parallel. It beats getting on an airplane to meet the customer. And with COVID, clients don’t really want outsiders coming on site.

Congratulations on your latest round of funding. How do you plan on using the money?

Beforehand, we did a lot with a little. We’re proud of that. We’re building a team. And we’re solving complex problems. We’ve architected drones flying in warehouses autonomously. How about operationally? How do you expand? How do you do the deployment? How do you build the system to handle it all long-term? We need really smart people to help us solve these problems.

The press release announcing your funding mentioned the Skydio 2 drone. Are there any other hardware platforms that are compatible with your software?

We only Skydio 2. We don’t get one-tenth the quality of images as DJI drones but for our purposes, we get better localization, indoor navigation, and obstacle avoidance.

You obviously have a sales team to help you obtain new customers. This next questions is aimed at drone services businesses, since some of them work with companies that have warehouses. Is your solution something they could add to their arsenal, an additional income stream?

The answer is unfortunately not. The market strategy is predicated on doing this remotely, it’s so easy that customers can implement it themselves. We do get a lot of interest from drone service providers, and unfortunately it’s just not a fit.

So even if some of us had connections with clients who have warehouses?

We’re totally open to paying a finder’s fee for a qualified lead that converts to a customer, we’ll happily pay a percentage.

Some businesses are a bit slow to adopt new technologies, even if they streamline a process. What case would you make for a warehouse manager or current decision maker to use Ware?

The dirty secret of the global warehousing industry is that no company, even the world’s largest company, knows where their inventory is in their own warehouses. To me, that is insane. How do you lose stuff in your warehouse. But they’re so big and they keep growing. eCommerce is growing continuously.

All managers understand this and they know inventory gets lost or misplaced due to something as simple as human error. Anyone working a warehouse knows that, it’s inevitable. There’s a process called “cycle counting” that they use to keep track of their inventory. Most of them don’t do it enough or they do it poorly. Basically, it has been deprioritized for more important tasks.

It’s very expensive to deploy a small army of humans to cycle count properly. Them and their customers lose goods, they need to write it off due to obsolescence. With Ware, you get to do a better job than you ever have before – truly twenty times faster than you’ve ever cycle counted, for less cost, better quality data, higher accuracy which is verifiable with the digits on every piece of inventory, and it’s very easy to integrate.

Why not give it a shot? We do free, on-site remote deployments and demos.