00:00Drone delivery startup ZipLine has closed a more than $600 million funding round,
00:05putting the company's valuation at $7.6 billion. Keller Clifton, ZipLine CEO, co-founder,
00:12joins us now. It's a big jump in valuation, although I don't think you actually ever
00:15disclosed the 2024 round that put you a pretty significant valuation of $5 billion anyway.
00:21But there's a lot of interest in this, Keller. Why did you raise the funds? What are you going
00:25to use them for? Well, I mean, you know, we spent most of last year expanding the service
00:29aggressively in Dallas. It's been an amazing place to, you know, for almost a decade, ZipLine
00:34operated mainly outside the U.S. And last year, there was basically regulatory progression in the
00:42U.S. that allowed this technology to start serving U.S. citizens. And what we've seen is just like
00:47explosive growth and basically infinite demand on behalf of customers. I mean, it turns out
00:52when you design delivery where anybody can pull out their phone, order anything they need,
00:57have it delivered to their home in less than 10 minutes, people use that service a lot,
01:01like 10 times as much as we've seen usage for traditional delivery services. And so,
01:06yeah, this funding round is going to allow us to start announcing new metros. Today,
01:10we're announcing that we're launching Houston and Phoenix over the coming months. And then we'll
01:14launch every quarter that comes now, we'll add new metros to the overall network.
01:18What's the scale of those launches at first, right? That, you know, when I shared some of
01:23the data that you've put out there on X, there was a lot of interest on the rate of expansion.
01:27You know, the headline is 2 million deliveries. But if you think about what we're talking about,
01:31last mile delivery, that's just a tiny fraction of what a delivery van will do.
01:36How real is this?
01:38I mean, the data that we're seeing, again, just in a single metro in the U.S., but the data is
01:42mind-blowing. I mean, we have municipalities in Dallas where just on Sunday, 10% of homes
01:49placed an order with Zipline in municipalities. So it's like, you know, we have certain cities
01:55where more than 50% of homes are engaged Zipline customers. So this has definitely gone from like
02:01science fiction to completely normal and something people depend on day in and day out
02:05in just a few months. The service has been growing about 15% week over week over the last year.
02:11Cano, what's the unit economics of it? How much are you having to spend on each of these deliveries?
02:19The advantage, I mean, it shouldn't be that surprising. But actually, I think people may
02:23not realize when you're talking about normal instant delivery, we're using a 4,000-pound gas
02:28combustion vehicle driven by a human to deliver something to your house that weighs five pounds.
02:32It's actually a super expensive solution. This is the reason that there are so many fees and then,
02:36you know, tip on top. Autonomous systems are going to be less expensive, 10 times as fast,
02:43plus they're zero emissions. So these kinds of systems are already cost comparable today.
02:48They'll be significantly less expensive in the future.
02:51There is a lot of interest in this particular funding round because some of the names involved are
02:56the hallmarks of a pre-IPO round, some anchor or tenant investors. Is that a fair assumption to make?
03:05I mean, Zipline has been really lucky. I think that there's a lot, you know, we've been building this
03:09company for 12 years, but I think it's finally kind of obvious that robotics is going to
03:13remake the planet over the last, I mean, I think it's going to transform a lot of economies.
03:17And logistics is one of the most obvious places where automation and robotics can have a huge
03:24impact. It can improve service, improve reliability. And it's something that people are going to depend
03:30on day in and day out. By the way, it can also create a lot of high paying jobs in the United
03:34States, both on the manufacturing front, as well as like maintenance. We're building out
03:37these complicated new kinds of infrastructure in each of these cities. It's the reason that every city
03:42has been so excited to have Zipline come. It's creating high paying jobs. We're investing in
03:46each of those cities that we're launching. Not sure that was an answer as to whether you're going
03:51to be IPOing or not, but I go really more to Kala. The fact that this is a global company.
03:57We're looking at your drones delivering food, but it's really about medicine and health. And in
04:02particular over in Africa, can you talk to us about how much of the scale of the business is there?
04:07Well, yeah, Zipline, you know, when we started the company, what we do today was illegal in the
04:12United States. So not an ideal pitch for investors, but this was the reason that we
04:16initially partnered with the government of Rwanda. You know, today Zipline serves 5,000
04:20hospitals and health facilities across the world outside the U.S. So we're a huge, huge healthcare
04:26logistics network. We've now done 135 million commercial autonomous miles with zero safety
04:31incidents. And the system is saving about 17,000 lives a year, predominantly moms and kids.
04:35One cool thing, just this week, we announced a new national scale partnership with the government
04:41of Rwanda. We're going to be dramatically expanding the number of use cases, building a new distribution
04:46center. And for the first time ever, Zipline is bringing its next generation technology, which
04:51we call Platform 2, to the continent of Africa.
04:54Kala, those regulatory changes you were talking about were the president's EO in June and then
04:59later in the summer, the line of sight rules, right?
05:02Yeah. This is all in the context of this is all in the context of the president's focus on this as a national
05:12security priority. I hope this question doesn't shock you. But how is Zipline thinking about literally
05:17weaponizing the technology, its use in defense use cases, conversations with the president?
05:23Well, the great news is actually that, you know, the government is trying to accomplish a lot of things.
05:27They're really focused on AI and exports and commercial diplomacy. This is the reason, you know,
05:31just five weeks ago, Zipline announced a $550 million total partnership with the State Department,
05:37as well as all of our African country partners to basically make sure that the developing world is
05:42built on top of U.S. AI and robotics infrastructure. That's really good because it can make sure that
05:47these countries, it enables these countries to save money and save lives. But it is also a key way of
05:53making sure that the U.S. can maintain its manufacturing and technology leadership for the decade to come.
05:58So Zipline is already working really closely on those initiatives. This announcement with Rwanda
06:02would not have happened without that partnership from the U.S. State Department. It's a big funding
06:06round. It's a big valuation. Zipline CEO Kelly Clifton. Thanks for joining us.
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