The company guiding Amazon’s trucks, underground miners and, hopefully, a moon lander, has raised $158 million to navigate into a unicorn orbit.
Key Takeaways
- Perth-founded, Sydney-based Advanced Navigation has raised $158 million.
- The Series-C raise will be used in an aggressive mergers and acquisition plan, CEO and co-founder Chris Shaw tells Forbes Australia.
- Manufacturing, currently done in Sydney and Perth, will expand to the US.
- The round was led by Airtree Ventures, with participation from Chris Hadley’s Sydney-based Quadrant Private Equity and the National Reconstruction Fund Corporation (NRFC).
- Advanced Navigation becomes the 25th portfolio company of the NRFC, bringing to $1.54 billion the Australian sovereign fund’s total investments out of its pool of $15 billion.
- Advanced Navigation predicts revenue of more than US$100 million this year, doubling next year, says Shaw.
Background
Advanced Navigation was founded by two friends from University of Western Australia, Xavier Orr and Chris Shaw, in 2012, arising out of Orr’s PhD thesis that used what was then a new form of AI, neural networks, to smooth out the noise in navigational systems operating independently of GPS.
“The problem we’re solving for is the fact that across all industries, all geographies, there’s a really heavy reliance on GPS,” Shaw tells Forbes Australia. “Our phones and cars, shipping, airliners through to defense applications, they all rely on GPS to operate.”
Down in a mine, or an “urban canyon” where the signal doesn’t reach, or in a zone where nefarious actors are hitting GPS signals, Advanced Navigation’s systems offer, literally, a road map, he says.
“The technology that we build actually solves all those problems. We really sell two things: resilience and accuracy of navigation.”
Advanced Navigation sells its systems for between $500 and $50,000 each and has profitable since its ninth month. Shaw says the same tech that’s booked in to help Intuitive Machines’ lunar lander navigate the moon-dust storm kicked up by rocket thrust, is the same as that used in mineshafts.
While they started with AI and gyroscopes at its tech core, it has progressed into robotics, underwater acoustics, photonic and quantum sensing, along with standard GPS.
“The technology we sell is very cross-functional,” says Shaw. “So that core tech that’s enabling the lunar mission, we also recently deployed with BHP … in the deepest underground mine in Europe to help them navigate autonomously.
“We’ve also recently deployed that technology with the US Army. That speaks to the addressable markets and the flexibility of the tech that we can go from a mining company underground to the army navigating somewhere else or even navigating on the moon. And that’s all from the same family that we recently launched.
The buy up
The $158 million of new capital will go to three core areas, says Shaw.
“We’re continuing to develop new technologies internally, but there’s also some merger and acquisition activities we’re doing. There’s other companies that have complementary tech in our space that we’re looking to merge with and acquire in the next 12 to 18 months.
“We’ve got quite a big pipeline on that because, if done properly, it’s a good way to accelerate technology growth.
“The next piece of investment is in local engineering and manufacturing … The world’s going through a lot of change and customers want their suppliers being in-region. They want surety of supply.
“People talk about sovereign capabilities, so we’re looking at setting up manufacturing in the US.
“We also announced we’re setting up what we call a centre of excellence in the UK to be closer to customers, modifying or changing the products for customers or even accessing local suppliers and getting feedback into our global manufacturing.
“Then the third area is in sales and marketing and organisational growth. The things we don’t win today are probably because we didn’t know they existed. So we want to make sure we’ve got our foot in the door.”
Shaw declined to give a valuation associated with the latest raise, but the company was reportedly close to billion-dollar status when it raised $108 million in it’s 2022 Series B.
“So we’ve doubled in valuation for the last round,” says Shaw. “We’re definitely in unicorn status now, which is great, but we don’t talk about the actual valuation.”
The company will do more than $100 million in revenue this years, Shaw says. “We’re hoping to double that year on year going into future years as well.”
Sydney-based Barrenjoey Capital Partners acted as strategic financial advisor to Advanced Navigation on the transaction.
Kelland Reilly, Partner at Airtree said the company was excited to partner with Shaw and Orr. “Advanced Navigation has built the leading solution in the positioning field and their rapid expansion into the U.S. and Europe marks a definitive shift for mission-critical industries as global demand converges around the precise use case they solve.
“The future will not be won by a single breakthrough, but by the bridge between classical physics and next generation intelligence.”
Advanced Navigation becomes the 25th portfolio company of Australia’s sovereign investment fund, the NRFC, bringing to $1.54 billion the money it has committed from its pool of $15 billion.
Industry and innovation minister Tim Ayres said the NRFC’s $50 million investment is expected to create 172 new roles across engineering, robotics, high-tech manufacturing, photonics, operations and technical sales.
“Using technology developed across Australia, with research hubs in Newcastle,
Western Australia, Sydney, and Canberra, Advanced Navigation uses robotics, AI and
high-precision sensing to improve navigation in the mining, defence, aerospace,
automative and agricultural sectors – solving uniquely Australian problems with
uniquely Australian solutions.”
NRFC CEO David Gall said: “NRFC’s investment in Advanced Navigation will keep the company’s headquarters, core R&D, and high-precision manufacturing capabilities here in Australia, building our sovereign and defensive capabilities and paving the way for the navigational tools of the future.”
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