An artist’s rendition of Archer’s planned electric aircraft, which the company says will be a … [+]
Courtesy of Archer Aviation
Over the past few months, a mysterious company called Archer Aviation has been setting tongues wagging in the small world of West Coast dreamers trying to build the future of air travel.
The founders, two Wall Street figures who built and sold a financial talent recruiting firm, have lured dozens of top engineers away from electric air taxi startups like Joby and Boeing-backed Wisk with rich compensation packages that include signing bonuses of two to three times annual salary and talk of connections to deep-pocketed investors.
Now they’re coming out of stealth, offering sparse details on the aircraft they aim to build and revealing a big-name backer who they believe will help them amass the hundreds of millions in funding they’ll need at a time when investment in the space is receding: Marc Lore, Walmart’s e-commerce chief and founder of Jet.com.
Newcomers to a complex field, Brett Adcock and Adam Goldstein told Forbes they’re very aware of the difficulties. “High capital costs, advanced hardware technologies, long timelines – overall it’s a very challenging business with a low chance of success,” says Adcock.
Compounding that, they’re off to a late start in a crowded field: There are over 100 initiatives under way around the world to develop electric vertical takeoff and landing vehicles, according to the consultancy Roland Berger. Some are getting money and manufacturing help from industrial giants: Toyota has invested in California-based Joby, and Daimler and Geely are backing Germany’s Volocopter, while Boeing has taken control of Kitty Hawk’s Cora program, now renamed Wisk, and Hyundai Motor has launched its own electric air taxi effort.
However, it’s not clear that any have found the magic balance between carrying capacity, range and technology that will result in a vehicle that can win safety certification and be economically viable.
Wisk and Volocopter may be test-flying autonomous two-seaters, but it’s uncertain when safety regulators will sign off on pilotless aircraft, and two seats may not be enough capacity to make money. Meanwhile, many of the smaller players face long odds of raising funds to advance beyond the concept or prototype phase.
“When you peel it back, the space doesn’t seem so crowded at all,” Goldstein says.
Archer plans to build a winged, piloted aircraft that can carry four passengers 60 miles at speeds of up to 150 mph, with rotors that tilt upward to allow it to take off like a helicopter and swivel forward to fly like an airplane. That’s similar to the two best-capitalized air taxi startups, Joby and Lilium, which are also developing five-seat tiltrotors, but notably more conservative in terms of range. Joby is aiming to travel 150 miles on a single charge, Lilium, 186.
Sixty miles would still be better than multicopter designs like Volocopter and Ehang, however a commercial tiltrotor aircraft has yet to be certified and brought to market.
Archer may have money to burn but whether it’s being spent wisely isn’t clear yet.
Brett Adcock (left) and Adam Goldstein.
Courtesy of Archer Aviation
Goldstein and Adcock are University of Florida graduates who began working together 11 years ago at the hedge fund Cedar Hill Capital Partners. They pocketed $100 million in 2018 from the sale of Vettery, an online recruiting marketplace they founded five years before, and began casting around for their next business opportunity.
They settled on urban air mobility, which they say they’ve had their eyes on for a while. “We firmly believe moving to a sustainable form of transport and helping to solve traffic problems in cities is a really important problem we’d like to solve in our generation,” says Adcock.
They say that struck a chord with Lore, who they met while networking in the tight-knit community of New York tech entrepreneurs. Lore told them he didn’t usually invest in startups outside of friends and family, but the founder of Diapers.com and Amazon AMZN challenger Jet.com, who earned a private pilot’s license in 2014, believed in the potential of electric air taxis to change the world.
Early Archer employees have spoken of having a billionaire backer, according to several UAM insiders. It’s not clear if Lore is a billionaire, but he appears to have reaped hundreds of millions when he sold Jet.com to Walmart in 2016, and he currently holds about $275 million worth of Walmart shares.
In addition to money and mentorship – Goldstein and Adcock say they speak to Lore every day – he brings a deep Rolodex. “Marc has raised a lot of capital from family offices and wealthy people with an interest in tech,” says Goldstein.
That money has enabled them to rapidly hire a lot of well-regarded engineers away from Wisk, Joby and Airbus’ Silicon Valley outpost. Since incorporating Archer in December, they’ve built up a team of 44, including Scott Furman and Tom Muniz, the former heads of avionics and engineering, respectively, at Wisk, and Geoff Bower, the chief engineer on Airbus’ Vahana prototype.
Goldstein and Adcock say their talent acquisition strategy has been informed by their experience at Vettery. “We’ve seen companies are shaped by the people,” says Goldstein. “We want to hire the best in the world and we’ll pay the best in the world.”
Some question whether they’ve overpaid: With Airbus folding the Vahana program and many Kitty Hawk veterans unhappy with changes on the Cora program since Boeing took control, a lot of engineers may not have needed outsize compensation packages to sign on.
And the mix of talent could be setting Archer up to follow in the footsteps of those startups rather than blaze a new path. Goldstein says they’re being careful not to use technology that will have a hard time passing through safety certification; nonetheless, their roster appears to be heavy on people who have developed innovative prototypes but who have never brought an aircraft through the painstaking process of certification to market.
Some early choices on hardware and software suppliers reinforce that: According to two engineers familiar with the company, Archer has signed up FlightHouse Engineering to design and build its airframe. The Portland, Oregon-based company is well-regarded for rapidly prototyping unmanned air vehicles but has scant expertise with building certified structures.
An Archer spokesperson said the company has hired a head of certification who will start in June.
Though it’s now based in the San Francisco Bay Area city of Santa Clara, Archer’s roots are in Florida. Goldstein and Adcock incorporated Archer in December with a principal address at the University of Florida’s Micro Air Vehicles program. The company also registered an experimental aircraft with the FAA that’s listed as having been manufactured at the university, which was previously reported by Avionics International. Goldstein notes that Archer is the name of a road that runs through the Gainesville campus, but the duo are vague on the relationship: they say they’ve donated money to their alma mater’s aerospace program and have learned from it but that the aircraft they’re working on is completely unrelated to the one that’s been registered.
They say that the design process is nearly complete and they plan to fly a prototype next year – at 80% of full-size, Goldstein says it will still be the largest electric VTOL to fly yet.
Like Joby and Lilium, Goldstein and Adcock aim to not only manufacture vehicles but operate their own air taxi service as well – a goal that will require substantial additional capital.
They think they’ll need roughly $500 million to take the aircraft through certification. “We joke we’re always going to be fundraising,” says Goldstein.