\n<\/p>\n
Escalating geopolitical tensions and a new administration with a hawkish defense agenda has led many startups to embrace dual-use strategies to secure revenue through military applications. And it\u2019s a trend that is already heating up in aerospace.\u00a0\u00a0<\/p>\n
Just look at Archer Aviation, a California-based startup building eVTOLs (electric vertical takeoff and landing vehicles). Until very recently, Archer\u2019s main go-to-market strategy was to launch air taxi networks across several cities in the U.S. and abroad.\u00a0<\/p>\n
Now, Archer\u2019s focus is more acutely on defense. And it\u2019s attracting fresh capital to further that mission.\u00a0<\/p>\n
The company, which went public in September 2021 in a special purpose acquisition merger<\/a>, on Tuesday announced a $300 million equity raise from institutional investors like Blackrock and Wellington, bringing Archer\u2019s total funding to around $3.36 billion. This fresh capital comes off the back of a $430 million round<\/a> in December to fund its new Archer Defense program.\u00a0<\/p>\n As part of that program, Archer signed an exclusive deal with weapons manufacturer Anduril to jointly develop a hybrid gas-and-electric-powered VTOL aircraft for critical defense applications. Together, the two are targeting a program of record from the Department of Defense, which is a budgeted acquisition program with guaranteed funding over a set period.\u00a0<\/p>\n \u201cAs we dug into the work we were doing on the defense front, we realized that the market was a lot larger than we initially expected, both in terms of scope as well as timing,\u201d Nikhil Goel, Archer\u2019s chief commercial officer, told TechCrunch.\u00a0<\/p>\n \u201cWe\u2019re the only company in the space that I think is targeting a sizable defense program of record,\u201d Goel continued. \u201cSo we really want to be strategic with the investments we\u2019re making and go full steam ahead on this.\u201d<\/p>\n Rivals in the space like Joby Aviation and Beta Technologies also have military contracts to test their aircraft for surveillance, logistics, and reconnaissance missions. Archer has its own such contracts with the military, but what it\u2019s chasing now via the program of record is guaranteed funding, a path to scale, and a serious competitive moat.\u00a0\u00a0<\/p>\n Goel confirmed that the $300 million from investors will mainly be used to accelerate the work Archer is doing with Anduril to build a hybrid VTOL, though he didn\u2019t share any updates on the company\u2019s bid with the DOD.<\/p>\n Archer\u2019s decision comes at a moment of industry momentum.<\/p>\n The Trump administration has vowed to \u201crapidly field emerging technologies<\/a>\u201d like AI, drones, and counter-drone systems to modernize the military. For eVTOLs, the very qualities that make them perfect for urban and regional flight are also attractive for defense use cases.\u00a0<\/p>\n Cruising at 300 feet, Archer Aviation\u2019s electric aircraft, Midnight, makes less noise than a passing car on the highway. In an urban environment, it blends into other transportation sounds in a way that helicopters cannot.\u00a0<\/p>\n \u201cThe sound profile is why we are so well positioned to [build aircraft] for defense,\u201d Goel said. \u201cIf you look at the traditional helicopters that the defense industry uses, they\u2019re very loud and have very noticeable heat signatures. And so that makes helicopters not a great fit for more discrete missions.\u201d<\/p>\n Archer\u2019s Midnight is built with 12 sets of engines and propellers \u2013 six in the front, six in the back. That distributed propulsion among smaller rotors that spin slightly slower, rather than a single large main rotor and tail rotor that operate at high speeds, creates much less noise.\u00a0<\/p>\n VTOLs are also designed to transition from a vertical lift to a winged horizontal flight like an airplane. When in forward flight, the Midnight generates all the lift from the wing, rather than from downward thrust, which also reduces overall rotor noise, Archer\u2019s CEO and founder Adam Goldstein told TechCrunch during a recent flight demonstration.\u00a0<\/p>\n While Archer is gunning to supply the defense industry with aircraft, the company still intends to launch its first limited commercial air taxi network in late 2025 in the United Arab Emirates.\u00a0<\/p>\n In 2026, Archer says it will expand air taxi services to several other cities and countries, including Los Angeles, San Francisco, New York, South Korea, and India. The company has partnered with major airlines to facilitate air taxi networks like United, Southwest, and IndiGo, and in November 2024, a joint venture from Japan Airlines and Sumitomo conditionally agreed to purchase up to $500 million of electric aircraft from Archer<\/a>.\u00a0<\/p>\nArcher\u2019s path to commercialization<\/strong><\/h2>\n