A Conversation with Firestorm Labs

Good evening, and as always, welcome to those of us who joined us this week! The Arsenal team is practicing distributed operations for the future fight, returning from USMC’s Integrated Training Exercise in the desert and sampling defense tech at Modern Day Marine in Washington, DC.

Recently, we talked about the contested logistics problem and highlighted one of the potential solutions as reducing transportation through prepositioning and/or point of use production. This past week, we caught up with Firestorm Labs to see how they’re addressing the challenge by “developing mission-adaptable aerial vehicles and upending the cost procurement paradigm” with their Alpha3 and Alpha4 3D-printed UAVs.

This week’s post:

• 🛩️ Additive-manufactured UAS platforms: a conversation with Firestorm Labs

• 💰 Term Sheet

• 🚩 Red Team Update

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Additive-manufactured UAS platforms: a conversation with Firestorm Labs

Without further ado, here’s Firestorm’s co-founder and CEO Dan Magy:

AoT: What’s Firestorm’s origin story? What need are you addressing and how did you identify that need?

“I’ve been doing startups for a decade, and sort of by accident in 2016 I started a counter-UAS (C-UAS) company for sports stadiums. Stadiums were very interested in this space because they realized they had a problem back in 2015, so I did what any non-technical person would do and started a technical C-UAS company” [Citadel Defense, which got acquired by BlueHalo in 2021]. Naval Special Warfare [NSW] found us in the push against ISIS in places like Mosul, Raqqa. ISIS bought thousands of these things [drones], off the shelf, paired them with things like 40mm rounds. And so the best-equipped, best-trained, and best-funded special operations force in the world was being fought to a standstill by these things. I started thinking about the problem of an underfunded and smaller country fighting a hegemonic neighbor [leading up to Ukraine], and what their options were. The original idea was a ‘$10,000 cruise missile’ using the Elon Musk Space X approach to drop the cost by a factor of ten or more. So could you use new manufacturing tech to disrupt a stale paradigm?”

The stale paradigm being?

“I call it the 15-day problem, a phrase I came up with to describe the state of readiness the US military is in. We have enough systems for two weeks, but after 14 days we’re in serious trouble. We don’t have the domestic base or manufacturing approach to resupply. Congress and the DoD are starting to ask questions of the primes: ‘we gave you hundreds of billions during GWOT, why can’t we meet production?’ So we’re spending billions of dollars on munitions to expand production lines but there’s zero incentive for primes to unlock their hardware. In solving this drone production problem, we identified the larger problem which is rapid manufacturing - domestically, at the edge, for partner forces - you name it!”

What’s Firestorm’s specific solution to address this, better or more rapid drone manufacturing?

“Build a UAV platform low-cost. The whole idea is for the drone to operate like an iPhone, basically building a platform around additive manufacturing. I met my co-founder Ian Muceus, who was at an additive manufacturing (AM) company called Origin, which was purchased by Stratasys. He looked at basically every approach in AM as Solutions Leader of Aerospace & Defense at Stratasys. So we came up with this idea of a partner-first, hardware and software open source approach. Our final piece of the puzzle was Chad McCoy, a USAF Joint Special Operations Command (JSOC) SME with 18 years of experience. We paired engineers with AM experts to build a platform around additive, and mixed in folks with experience from traditional primes, SMEs around autonomy, navigation - we call it a witch’s brew of expertise. The beauty of our platform approach is that it lets us scale up or down in design size by scaling up the same design - you just need some tweaks to support materials for the larger designs. But in initial production we are able to print a drone per day with just one FTE, scalable to 50 or 100 drones with a team of 15. We’re able to do this through so much manufacturing optimization, reducing hundreds of parts from our product over the last few months.”

Firestorm designs and 3D-prints a scalable UAV and uses AM to drive down costs and do it rapidly. But you’re not 3D-printing the engines and sensors or payloads, right? How do those get integrated?

“Today, we’re starting with a hobbyist jet engine. These things have off the charts maneuverability and speed. We believe that this approach is incredibly disruptive and enables you to cause chaos on the battlefield with your drone. From a sensor standpoint, we’re building an EAR99 exportable version and simultaneously an ITAR version. The approach is ISR-first, and you can upgrade as you go. Kinetic or whatever else you want to do, sort of a Chinese menu of options.”

How do you see these being used in the first island chain, or how do your customers want to use them?

“We have four or five CONOPS: there’s a loitering munitions play, an ISR play, a decoy play (swarming using EpiSci ultra-low cost AI autopilot), and an ‘ultra-decoy’ play. So maybe you paint our bird a certain color and pump trons to make it emit as something else, like a larger, traditionally aircraft. But it’s a truly attritable platform with four or five use cases right now, and not the $2-20M attritable that other programs in DoD have morphed into.

A lot of times, defense tech entrepreneurs have the technology or solution but not necessarily the military background or clear view on the use case for the solution. You have Chad on the team, but can you talk about how you developed these 4-5 CONOPS? Where did they come from?

“We boiled the ocean. Basically we did a ton of customer discovery. So we start with SOF to get the TRL [technology readiness level] up, but in talking with customers they started asking ‘Can we build this in Guam? Build a factory in Poland? Pump them out and go across the border?’ We try to get an understanding of what leaders really want to do, which can be tricky because sometimes you have non-technical people in technical roles, and positions turnover in 12-24 months. So we have to take that and build for requirements today and try to help influence requirements in the future. Ask people questions, figure out what problems they have, then you have to synthesize them in a way to repeat back to them.”

Yeah, there’s the dual-agent sort of problem in DoD where your customer is not always the end user and the person who pays isn’t typically the person who uses the technology. How have you found dealing with this aspect, or your experiences with DoD across the board?

“When you talk to enough people, you find that there are people who really want to solve problems. There’s a growing concern as younger people move from experience into leadership positions and they know procurement is not working. We have to understand what the warfighter really needs and build to that. At the same time, you have to draw a line in the sand: this is our base system. It’s the Steve Jobs approach [you tell people what you are building rather than let them design it]. If you want a different camera for NSW than the Army, fine, but this is how much more it will cost. Our approach is to execute four or five missions really well, then at the end, show a list of 20 more things you could do with the platform. The demand signal is from the bottom but the requirements are shaped from the top, so that’s a lesson we had to learn the hard way. But in fact the expeditionary manufacturing concept came out of these customer conversations. We designed the whole CONOPS around obfuscated manufacturing from these discussions.”

Oh wow, so originally it was an AM platform play, then you expanded it to include expeditionary logistics?

“Yeah, the larger companies can’t keep up with demand. Customers were asking, ‘Can we put this in a cell, on a FOB [forward operating base] or in a discrete location?’ So we’ll send the pack, assemble in the pack with additional components [propulsion, sensor], containerize all that, make it mobile and build as many as you want.”

How’s that look to Firestorm in a future operating environment? Operators won’t necessarily be aircraft designers, so do they choose from a menu or design options or how does that process work?

“Our goal is to eventually be able to CAD up a design in a day and send it over a network. It would be amazing to get to a library of options to choose from. Maybe we’re not just making UAVs, but other systems at the edge: underwater, surface, torpedoes, munitions. We’re being told by customers, ‘We’ll be dropped on some island with no resupply for six months. How much is a printer, how do I get one, set up a VR headset if I need to troubleshoot. You send us the ISU-90 [shipping container] with every component. I have explosives here and will buy what I need.’ So we say, ‘Here’s the airframe, here’s what it looks like and an expeditionary kit to print it. You have the drone airframe and tradespace of weight to do whatever you want with payload.’ They’ll use it for some of those CONOPS, or others like packing with a few pounds of buckshot and explosives and flying it into targets.”

The same type of UAS use we are seeing in Ukraine. Can you talk about your funding profile?

“We raised $4.5M of seed funding and today got awarded a Phase II SBIR from AFWERX. So not that much government money yet but we are committed to helping solve these contested logistics and affordable mass problems. We had a couple selected not funded before the Phase II. I wish the government was doing more to take input from the warfighter, get stuff funded and put it in their hands. The end user has no ability to expend R&D funds, so there’s a bunch of different COCOM customers who want our stuff but can’t find or spend the cash for it. From experience knowing how the system works, we’re starting to influence requirements going forward. Because if you believe that future conflict will be shaped by who makes the most stuff the fastest, then you can’t use traditional manufacturing approaches and you have to do some stuff at very low cost. We’ve been approached by partners around the world to build up versions of our system, because they see a huge problem with supply chain and want to shorten the manufacturing timeline and get stuff beforehand. Like a strategic stockpile.”

And even if we had manufacturing rate parity with China, we’d still have to somehow get our gear across 7,000 miles of ocean.

“Right - it’s the tyranny of distance problem.”

Partially solved by point of use manufacturing here. You talked about scaling the product and technology. How do you scale to the DoD?

“We’ll do fine on SOF but moving it beyond will be a challenge. The big obstacle will be convincing program offices to make small bets to de-risk other programs.”

Or more ideally, become the new program when there’s a winning technology.

“Exactly, and some people really see it coming. Manufacturing multiple sizes cheaply that have the brains is disruptive. There was a recent Forbes article calling out the DoD for not making these smaller strategic bets. It’s like ‘Why worry about getting fired for not choosing some large prime on a contract?’ The government has to take risks or we’ll lose.”

Completely agree. Speaking of primes, what’s the strategy there? A sub to a prime? I guess the better question is, what’s Firestorm’s exit?

“We sort of ran into a prime buzzsaw with Citadel. So we positioned ourselves differently this time with prime support. Maybe a prime tries to buy us in a couple years, but I believe there’s really a lot of space right now to build the next nimble defense company. And we think the market is four to five times larger overseas. We are building for America because we’re patriots, but there are other markets and ultimately a startup lives and dies by cash.”

Which is a lesson more in government need to learn. Speaking of other markets, last week we talked about dual-use tech. Any commercial application here? You started Citadel on the civilian side for ‘stadium defense’...

“Yeah, we’re talking to some emergency response groups about drones that are multi-role. We’ve also put a QR code on a bird as a zipline competitor. So you’d fill it with diesel gas, scan the code, deliver logistics, fill it with diesel again and return to sender. But talking manufacturing, really could build anything at the edge where it’s needed.”

What’s Firestorm’s bumper sticker to leave our readers with?

“We’re helping to solve contested logistics, and producing affordable attritable mass. There’s a mega-demand signal in manufacturing and we’re building a scalable platform around additive manufacturing.”

We’re certainly familiar with both problems. Dan, thanks so much for the time and best of luck to you and Firestorm. Congrats on the Phase II SBIR today, we’ll be watching closely.

Red Team Update

Russia Taps Power of Tech Startups for New Kamikaze Drones

• Russia's military is making a strategic shift towards utilizing tech startups to improve its drone technology, with the Privet-82, a new low-cost loitering munition, being one of the initial products. The munition has undergone successful combat tests in Russian-occupied Ukraine, demonstrating the potential effectiveness of this new approach. The manufacturer, Oko, is planning to produce a super cheap cruise missile next, tagged as costing no more than a washing machine

• Despite recent advancements, Russia's drone technology has been largely underperforming, especially in comparison to Ukraine's vibrant ecosystem of drone startups. Russian troops have been vocal about issues related to the availability and quality of drones on the frontline. Failings have ranged from the use of low-quality components to difficulties securing communication. To fill the gap, Russia has been importing loitering munitions from Iran, as domestic production has not met demand

• Dmitry Rogozin, former Deputy Prime Minister in charge of the defense industry and now head of the Tsar’s Wolves, is playing a key role in promoting Russia's drone development. His organization aims to get new technology to the front line as quickly as possible, bypassing Russia’s traditional defense industry's inefficiencies. This strategy appears to mirror Ukraine's success in leveraging startups to advance drone technologies

Center for A New American Security - Proliferated Drones: A Perspective on Russia

• The Russian military has been gradually making progress in the development and production of indigenous small and tactical Unmanned Aerial Vehicles (UAVs) due to an increased need for short-range drones. Some of these locally produced drones include the Eleron-3SV, Granat, Takhion, and Korsar. However, their technology lags behind leading competitors. Furthermore, their lightweight designs prevent them from carrying complex payloads for use as weapon platforms.

• Russia has initiated the development of three categories of heavier drones: the 1-ton Inokhodets, 4.5-ton Altius-M, and 15-ton Okhotnik, which are expected to be ready for production between 2018 and 2020. They have also tried to acquire foreign technology to supplement domestic research and development efforts and speed up the development of locally-built drones. Contracts with foreign companies like Israel Aerospace Industries and OAO Gorizont have allowed Russia to assemble drones under license

• One challenge Russia faces in its drone usage is reconciling the differing needs of its various military and civil services. A State Unmanned Aviation Center has been established to train UAV operators from various ministries and agencies to address this issue. Despite being behind the West in drone technology, Russia has developed a comprehensive strategy for using UAVs and robotics in warfare, with a particular focus on no-contact warfare. Given Russia's vast landmass and extensive borders, surveillance of national territory and adjacent areas will likely be a primary task for drones

About Us

Our team has 30+ years of combined experience as military officers using the end products. We’ve worked in both government and industry. From MIT to Wharton, Wall Street to biotech, and DARPA to the flightline, we offer you a unique perspective on how to navigate America’s defense tech industry.

The opinions expressed in this newsletter are solely those of the authors and do not necessarily reflect the views of DoD, our employers or any affiliated organization. This newsletter is for informational purposes only and is not intended to provide legal, financial or professional advice.OustedOut