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Sunday, Oct 2, 2022

Anduril Industries’ Value Surges to $4.6B

Anduril Industries’ valuation has more than doubled to $4.6 billion on a $450 million funding round, as the Irvine-based defense and border protection firm says the Pentagon has bought into the company’s vision of readying the country for a high-tech battlefield future.

The company, founded by Newport Beach entrepreneur Palmer Luckey in 2017, has long said its goal is to revamp defense systems for the 21st century for the U.S. and its allies, while challenging industry giants such as Raytheon and Lockheed Martin in the military sector.

“We are on a mission to transform the defense capabilities of the U.S. and our allies with the technologies shaping today’s battlefields, including artificial intelligence, machine learning, sensor fusion, and autonomous systems,” said Anduril co-founder and CEO Brian Schimpf in announcing the financing round last week.

The $450 million Series D round is amoung the largest reported for an Orange County-based private company in several years. Anduril has now raised $828.5 million since its inception.

Anduril provides a variety of hardware and software products to the military and defense sectors.

The company uses a combination of radar sensor-clad surveillance towers, drones and artificial intelligence centered around its core Lattice system to monitor and protect large land areas.

Lattice is also the operating system that enables Anduril’s autonomous unmanned aircraft, such as the new Ghost 4 drone, to perform their missions.

“This new round of funding reflects our confidence that the Department of Defense sees the same problems we do, and is serious about deploying emerging technologies at scale across land, sea, air, and space domains,” Schimpf, 37, said in announcing the financing on June 17.

Luckey put his own tech spin on the deal.

The money “will be used to turn American and allied warfighters into invincible technomancers who wield the power of autonomous systems to safely accomplish their mission,” said the 28-year-old, who also founded virtual reality gear-maker Oculus VR in 2012 and sold it for $3 billion in 2014 to Facebook, in a Twitter post last week.

Growth Machine

The funding deal marks another milestone for Anduril, which has been growing exponentially in its value, headcount, and local footprint.

The company said last July it had raised $200 million, almost doubling the company’s valuation to $1.9 billion at that time.

The Anduril employee count has increased to almost 600 companywide, from 400 in March. It was advertising for 82 additional positions as of June 17.

It is the fastest-growing local defense firm, and ranked No. 15 on the Business Journal’s latest list of top local aerospace and defense companies by local employee count.

Anduril said in February it is moving to Costa Mesa and taking over the entirety of The Press development at the former LA Times printing facility, providing room for 2,100 people there.

The 640,000-square-foot lease is among the largest in OC’s history.

Investors Double Down

The latest funding—the Series D round—was led by tech investor Elad Gil, an early backer in the company, with participation from Andreessen Horowitz, 8VC, Founders Fund, General Catalyst, Lux Capital, Valor Equity Partners, and D1 Capital Partners. All of them except D1 Capital Partners were listed as having taken part in the Series C round last year.

The investors believed in Anduril “when we were nothing” and doubled down “when we showed traction,” Luckey said last week.

Companies that carry out a Series D round “tend to either do so because they are in search of a final push before an IPO or, alternatively, because they have not yet been able to achieve the goals they set out to accomplish during Series C funding,” according to finance website Investopedia.

The investment announced last week will accelerate Anduril’s development of technologies, the company said.

“Anduril is transforming the way the U.S. Department of Defense procures, scales, and deploys new technology,” Gil said.

In addition to the U.S. Department of Defense, Anduril has contracts with the U.S. Department of Homeland Security and the U.K. Ministry of Defense, among others.

In the last 12 months, Anduril was awarded a contract with U.S. Customs and Border Protection to aid in “situational awareness” at the Southern border. Other milestones include:

• The Purchase of Area-I, a Georgia-based company that makes military drones capable of being launched from helicopters and other moving platforms.

An expansion of offices in Boston, Seattle, and London.

• The launch of Ghost 4, which the company calls “the world’s most intelligent small, autonomous military drone designed to meet the needs of military users.”

Much more is on the way, Luckey told his Twitter followers last week. “Our future roadmap is going to blow you away, stay tuned!” 

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Kevin Costelloe
Kevin Costelloe
Tech reporter at Orange County Business Journal

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