- Despite being young, the electric aviation industry is growing quickly.
- Commercial airlines and electric air taxis both present big market opportunities in the field.
- Joby Aviation and EHang are among the best-funded electric aviation startups.
While the electric aviation industry is young, it’s growing quickly, driven by commercial airlines’ need to lower fuel costs and meet ever-stricter emissions standards. The global market for electric aircraft is estimated to have reached $7.9 billion in 2021 and projected to reach $27.7 billion by 2030, according to market research company MarketsandMarkets.
The makers of electric aircraft are targeting at least two big market opportunities. In commercial aviation, they hope to replace the large, expensive, fuel-burning jets airlines use for many of the 45 percent of global flights that run less than 500 miles. Electric planes stand to significantly lower emissions, as aviation is currently responsible for about 1.9 percent of greenhouse gas emissions and 2.5 percent of CO2 emissions, according to scientific online publication Our World in Data.
Another focus is electric air taxis, a market expected to hit $150.9 billion by 2035, according to PitchBook. Many startups are focused on creating electric aircraft that can be used for aerial ridesharing services, which they promote as the future of urban mobility.
There’s plenty of competition among startups for VC funding. There are 106 electric aircraft companies globally as of December 2021, according to Tracxn, a research firm that provides startup data for venture capitalists. A majority of the best-funded startups are located in the US, primarily in California, with others based in China and Germany. In 2020, VC deal activity in the field reached $1.17 billion with 24 deals, and in 2021, deal activity reached $1.13 billion with almost twice as many — 41 — deals, according to Pitchbook.
Developing electric aircraft is a costly business, and startups need a lot of funding to design, develop, manufacture and test their models. The companies that secure the most funding from venture capitalists stand the best chance to succeed in the fast-growing industry.
Here are the 10 best-funded startups in the electric aviation field.
Total amount raised: $718.3 million
Joby Aviation was founded in Santa Cruz, California, in 2009 by JoeBen Bevirt, who serves as the company's CEO. It is developing an all-electric vertical take-off and landing aircraft, or eVTOL, that it plans to operate as part of an aerial ridesharing service. Joby has completed more than 1,000 test flights of its eVTOL in the last decade and is currently working with the FAA to gain certification. It expects to begin commercial operations in 2024.
Total amount raised: $425.6 million
Beta Technologies was founded in 2012 by aerospace engineer Kyle Clark, the company's CEO and lead test pilot. Based in South Burlington, Vermont, Beta has also developed an eVTOL, named ALIA, that it plans to use to move both people and cargo. UPS has agreed to purchase 10 Beta aircraft, with the option for 150 more, to speed up and simplify elements of its package delivery network. The first aircraft are set to arrive as soon as 2024, according to UPS.
Total amount raised: $391.5 million
Founded in 2015 by Daniel Wigand, Sebastian Born, Patrick Nathen, and Matthias Meiner, the German startup lists its goal as developing sustainable, high-speed air travel. It has created the Lilium Jet, a seven-seat air-taxi. Based out of Munich, the company has struck a deal to build as many as 220 eVTOLs for Brazilian air carrier Azul Airlines, in a deal that could be worth up to $1 billion.
Total amount raised: $377.8 million
Volocopter is a German urban air mobility startup founded in 2011 by Alexander Zosel and Stephan Wolf and currently led by CEO Florian Reuter. The company plans to launch an air taxi service and has designed the VoloCity air taxi, with plans to begin commercial flights in Paris and Singapore within two to three years. It has also created vertiports it calls VoloPort and the VoloDrone for heavy-lift cargo transport.
Total amount raised: $101 million
ZeroAvia, a Hollister, California-based startup founded in 2017 by CEO Valery Miftakhov, has developed a hydrogen-electric propulsion system that can be retrofitted onto existing aircraft. The company proposes that hydrogen-electric powertrains are the best way for commercial airlines to transition to clean and sustainable aviation. It plans to have its first commercial offering by 2024 and a 200-plus seat aircraft ready for commercial use by 2040.
Total amount raised: $100 million
AutoFlight is a Shanghai-based startup founded in 2017 by CEO Tian Yu that proposes to achieve mass individual transport in the air. It has created several models of eVTOLs to transport both passengers and cargo, including an autonomous passenger eVTOL, which completed its maiden flight in October 2021.
Total amount raised: $90.6 million
Founded in 2018 by Grant Verstandig and Bo Marr, this Los Angeles-based startup created a high-power microwave technology designed to counter unmanned aerial systems such as drones. Epirus is working with the US government to use the technology for military purposes, but also plans to use it for commercial purposes, such as airport safety.
Total amount raised: $75 million
Founded in 2010 by Sebastian Thrun with backing from Google cofounder Larry Page, Kittyhawk is building a single-seated electric aircraft that is remotely-piloted. The Palo Alto-based company's goal is to make affordable air taxis, and it says its remote-piloting system as well as the design of the aircraft will allow it to keep costs low. The startup has built and flown more than 100 aircraft and is currently testing an aircraft it calls H2, which can fly a hundred miles on a single charge at up to 180 mph.
Total amount raised: $56 million
Bye Aerospace, founded in 2007 by George E. Bye, has created several models of the eFlyer electric aircraft, which it designed to be used for pilot training. The company proposes its electric aircraft reduces fuel costs for student pilots, which it says is a primary reason student pilots drop out of training. Based in Englewood, Colorado, the company has created multiple versions of the eFlyer that can seat two, four and eight people.
Total amount raised: $52 million
Based in Guangzhou, China, EHang is a leader in Chinese eVTOLs. Founded in 2014 by Huazhi Hu, EHang developed the EHang 216, an autonomous, two-seat aircraft made to transport both people and cargo. The company describes its mission as making safe, autonomous air mobility accessible to all.