EIB and Quantum Systems conclude €10m loan to develop drone capabilities

Quantum Systems, founded in 2015, successfully developed drones with a wing flight mode that enables long travel times, long ranges and quiet flight by utilising electrical and aerodynamic efficiency.

The European Investment Bank (EIB) and drone startup Quantum Systems have concluded a loan agreement of up to €10 million to further develop capabilities in the areas of autonomous flight and artificial intelligence.

Quantum Systems, founded in 2015, successfully developed drones with a wing flight mode that enables long travel times, long ranges and quiet flight by utilising electrical and aerodynamic efficiency. The drones are capable of vertical take-off and landing. The founders registered a patent for a vertically launchable unmanned transition aircraft in 2012.

The drones can be used in search and rescue operations after catastrophes like the recent floods in Germany, Belgium, Luxembourg and the Netherlands. Further areas of applications are smart farming, volume calculation in open-pit mining, surveying work for large construction sites, real-time situational awareness, tactical mapping and automated railway inspection.

Quantum Systems' technology promises competitive advantages in areas like coverage, reliability, endurance, flights in windy conditions, high flight speed and autonomous flying abilities. The company targets the growing governmental market — where a limited number of companies based in the United States and Israel have historically provided systems — and the commercial market.

The EIB loan is part of the European Growth Finance Facility (EGFF), via which innovative startups can get a debt alternative to equity financing. The EIB thereby offers startups an alternative to finding additional shareholders and allows the founders to retain majority ownership. The programme is part of the European Fund for Strategic Investment (EFSI).

"We are proud of this unique funding product that met an urgent demand. Venture debt protects ownership, fuels growth and helps to bring new technologies to the market," said EIB Vice-President Ambroise Fayolle, responsible for projects in Germany and engagements related to the environment, climate action and the circular economy. "If we want to support the market leaders of tomorrow, we need to take certain risks. We believe in the potential of the companies that we support and are committed to helping them grow by providing tailor-made financing."

European Commissioner Mariya Gabriel, responsible for Innovation, Research, Culture, Education and Youth praised the European Union's innovation programme, saying: "We are glad to enable new ideas to be turned into concrete innovations by big and small entrepreneurs, improving our collective prosperity. The EGFF is an essential instrument to foster the competitiveness of European economy."

"With the fresh capital, we want to expand our research and development capacities in the areas of autonomous flight and artificial intelligence and drive the further vertical integration of system-critical components of the vertical take-off and landing drones," said Florian Seibel, CEO and co-founder of Quantum Systems. "The funds are used to increase sales and marketing measures as well as the ramp-up of production and operations, supporting the company's strong growth." In 2020, Quantum Systems achieved a 155% increase in revenue compared to the previous year.

The advisors of FCF Fox Corporate Finance supported Quantum Systems in its search for financing. "Especially for young and innovative companies, the EIB's venture debt financing offers enormous advantages in financing growth measures such as R&D, sales, marketing or building-up working," said FCF-Director Florian Theyermann. "One of the advantages of such an EIB loan is that, in contrast to a capital increase, the founder's shares are not diluted."