US private cellular and drone services provider Ondas Holdings, parent of Ondas Networks, has raised “at least” $15 million in a two-phase venture funding deal with Charles & Potomac Capital (C&P Group). The new investment will go to “accelerate production, fulfill backlog and support growth”, the company said. Specifically, it cited fulfilment of a January deal with Siemens to supply radios in the 160 MHz band for freight rail in the US.
The new funding effectively covers Ondas’ $15.2 million outlay on Israeli drone system and platform developer Airobotics in January, actually agreed as a merger-acquisition. Airobotics has been combined into American Robotics, acquired by Ondas Holdings for $70.6 million in 2021. Ondas is offering a combined solution for private networks and unmanned autonomous vehicles (UAV) to utility and industrial markets.
Its FullMAX radio platform overcomes the limitations of “legacy private licensed wireless networks”, it reckons. The firm’s existing Scout System is billed as the “first” drone system to receive FAA approval for autonomous flight beyond-visual-line-of-sight (BVLOS); it comprises an autonomous drone (Scout) with camera sensors, a ruggedized base station (ScoutBase) for housing and cloud transfers, plus analytics and front-end software (ScoutView).
Ondas is targeting mission-critical users that require reliable and secure cellular, often across challenging geographic and radio terrains. These include the railway, aviation, energy, and oil and gas sectors, as well as various government entities. Ondas Networks offers proprietary cellular solutions for ‘mission-critical IoT’ (MC-IoT) applications, including with its own 700 MHz spectrum holdings in certain US regions.
In January, Ondas received a major order for 160 MHz radios from Siemens Mobility on behalf of a major Class 1 freight railroad company – their first order, together, in the 160 MHz railroad band in North America. Ondas has previously announced a volume order for radios in the greenfield 900 MHz network in the US. The 160 MHz band offers “greater data capacity and range in challenging geographic environments”, it said.
The funding arrangement with C&P Group, which is to be allocated to the Siemens deal, is structured in two parts. C&P Group will supply $10 million, initially, subject to certain closing conditions, and a further $5 million potentially as part of a second funding round in the third quarter. The second round will seek to raise at least $5 million from a separate “strategic investor”; C&P Group will commit $5 million in the event a second investor is not found.
C&P Group’s investment will buy common stock shares in Ondas Networks, rather than Ondas Holdings.
Eric Brock, chief executive at Ondas Holdings, said: “This financing will provide valuable working capital to support the scaling of Ondas Networks, as we transition to delivering our world-class connectivity platform to Siemens and the Class I Railroads. We look forward to partnering with Joe Popolo and the C&P Group, to help build substantial value for Ondas Holdings and our Ondas Networks business unit in the coming years.”
Joe Popolo, chief executive at Charles & Potomac Capital, said: “We are excited to partner with Ondas Networks as they begin to scale in the important rail markets they have secured. Our investor group has performed significant diligence and believes that Ondas Networks is poised for considerable growth as market adoption of their software defined FullMAX™ connectivity platform continues to ramp.”
