VCs See Ex-Wired Editor's DIY Drones Taking Flight

This story appears in the March 2013 issue of Entrepreneur. Subscribe »

Last year Chris Anderson chucked one of the most prominent posts in tech media--editor of Wired--to become CEO of 3D Robotics, a company that helps hackers, engineers and enthusiasts build do-it-yourself drones, the small, remote-controlled helicopters and planes that are mostly used for aerial photography and surveillance on the cheap.

To those who've read the bestselling author's books, the move came as no surprise. The Long Tail (2006) makes the case that our economy and culture are shifting from mass markets to millions of niches. Makers (2012) revives the notion of profitable, low-unit manufacturing, thanks to open-source design and 3-D printing.

Aerial robotics "has been my passion for about five years," Anderson says. He founded San Diego-based 3D Robotics in 2009 with Jordi Muñoz (then 21 and just arrived from Tijuana, Mexico) to commercialize some of his projects. "It's never been easier to get into manufacturing than it is today," Anderson says. "Jordi started on a kitchen table, but then built an amazing team and advanced production facility in San Diego. He taught himself everything, bought our first pick-and-place machine on eBay and even hacked a toaster oven for use in manufacturing."

Eighteen months later the venture, which sells helicopter-like drones for $250 to $750, as well as parts, had passed $1 million in sales. That number doubled in less than a year, then doubled again. "Now, three years after the kitchen table, we have two factories, more than 40 employees," Anderson says. "Every time I'd visit the factories, my jaw hit the floor anew."

3D Robotics caught the attention of venture capitalists who understood the company's open-innovation model and what Anderson calls its "future-of-aerospace ambitions." Last fall Anderson locked up a $5 million funding round led by Jon Callaghan of True Ventures and Bryce Roberts of O'Reilly AlphaTech Ventures. "These are the two most far-seeing VCs in the Valley," Anderson says. "Both are part of the hardware-is-the-new-software trend, including investments in Fitbit, MakerBot and littleBits."

"We were seeing a ton of activity around drones with the alpha-geek crowd," Roberts says. "And when we see these flare-ups of activity, particularly among hobbyists, we take note and begin to form our own thoughts around where commercial opportunities might emerge."

Anderson opened a Bay Area office for sales, marketing and community development, while Muñoz took the reins as president, overseeing manufacturing in Tijuana and R&D in San Diego. The company's plan is simply to ramp up with "more cool stuff," filling a growing niche among geeks, much like the computer industry did in the 1970s. And we all know how that turned out.