The Dream of Flying Cars meets the Truth of Aviation Startups

Personal aviation is awesome!

Aviation has been a source of inspiration and a symbol of innovation since the Wright brothers' first flight at Kitty Hawk, to Neil Armstrong's first steps on the moon, to today's dreams of colonizing Mars.

Unfortunately, it's been very hard for startups to make money in aviation. Even the Wright brothers did not do particularly well in business.

But things might be changing. Today we sit down and talk with Tasuku Nakai, co-founder of Tetra Aviation, and we discuss how public research incentives, support from the aerospace giants, and the changing infrastructure needs might have just tipped the balance to startups.

It's a great conversation, and I think you'll enjoy it.

Show Notes

How Tetra's eVTOL aircraft came to be and what it might become The steps needed to bring a new aircraft to market Why it's so difficult to innovate in aviation The main hurdle in expanding the personal aviation market Fundraising strategies and exist options for aviation startups When investing is considered "evil" in Japan

Links from the Founder

Everything you ever wanted to know about Tetra Aviation Friend Tasuku on Facebook Connect with him on LinkedIn Follow Tetra on Twitter @Tetra_Aviation Check out a video of their prototype VTOL aircraft

Leave a comment Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I'm Tim Romero and thanks for joining me. Today, we’re going to talk about flying cars. That’s right, flying cars. We sit down with Tasuku Nakai, co-founder of Tetra Aviation and we talk about what it takes to bring a new aircraft, especially a new personal aircraft to market, and it’s not easy. The Tetra Aircraft is an electric vertical take-off and landing, or VTOL aircraft, which they believe will form the backbone of a new aerial intercity transport system. You know, I have a real soft spot for these kinds of startups. I have a private pilot’s license and I love the idea that the age of affordable personal aircraft might almost be here. But as I mentioned, it’s hard, and as Tasuku explains, these kinds of companies don’t fit the traditional VC model for a number of reasons. We also talk about the possible business models open to aircraft startups, the release of Tetra’s new prototype, and the crazy world of experimental aircraft pilots who fly newly designed aircraft as a hobby. But you know, Tasuku tells that story much better than I can, so let’s get right to the interview.

Interview Tim: So, I’m sitting here with Tasuku Nakai of Tetra Aviation who makes personal electric aircraft, so thanks for sitting down with me. Tasuku: Thanks for inviting me, Tim, and this is a really great moment to introduce myself and introduce my business. Tim: No, the pleasure’s all mine. I think what you guys are doing is really interesting and I’ve had a passion for, like, aerospace startups for a long time, so actually, I mean, you can probably explain what Tetra Aviation is and what the product is better than I can. So basically, what are you building? Tasuku: We are building personal electrical VTOL aircraft, so vertical take-off and landing, so wherever you want to come, just simply ride on it and fly to the air and arrive on your destination exactly. Tim: And we’ll talk about the history later. This is kind of like the flying cars that startups have been teasing us about since the 1950s, but what you’ve built, is it considered an airplane or a helicopter, or a drone, or how is it classified? Tasuku: Well, a really difficult question about that. There’s no category anymore. There’s a lot of class, almost 50 or 60 classifications, but basically, you think it’s similar for helicopter and the drone, to combine the helicopter and drone, so I mean, the people can ride on it and also, it has a distributed propulsion system as a drone has. Tim: Actually, just today, you guys released this really cool video of the prototype. Tasuku: Mm-hmm, yes. Tim: Yeah, and we’ll put a link of that up on the site cause it’s really cool, but I’ve noticed like the prototype, the video you released still has unmanned piloting. Are you still doing unmanned or have people been able to ride it and fly it yet? Tasuku: Oh, yes, we are still doing unmanned flight for this model, and we’re building up a manned flight aircraft for next model. Tim: Okay, well, actually, let’s back up a bit. Developing a new aircraft is a lot more complex than developing a new HR system or developing new business SaaS. Tasuku: Yeah, that’s right. Tim: So what is the process? I mean, where are you in development? You’ve won several awards already for the work but where are you now and what steps do you have to take until we have people able to ride these? Tasuku: What we have to do is make a culture or some custom about riding on those kinds of aircraft, eVTOL for next transportation network, but first, what we have to do is building an actual product that people can actually onboard. To do that, we mitigate the risk of people’s fear about riding on it or flying over your head, so we have to build some trust about making fine things in the market. So what we do is first of all, there’s no injury is most important parcel. Starting from the unmanned flight basically and also the development is continue to no person onboard, so with that credit, we can put on some test pilot on our aircraft who are willing to collaborate with this experiment, not a special test pilot, but they are willing to collaborate with our aircraft in a more general way. So we are focusing on experimental aircraft market. Tim: In terms of like the time frame, you guys started Tetra Aviation three years ago? Tasuku: About two year ago, two years and three months. Tim: Oh, okay, so it took like a little over two years to get from concept design to an experimental aircraft. From this stage, how long will it take before we can get, like you’re saying, people piloting it as an experimental aircraft? Is that happening next month or is that a year away? Tasuku: Oh, we are planning to introduce our aircraft next year, showing off in the experimental market, get interest from test pilots, so we’re planning to put our aircraft into the exhibition at Oshkosh AirVenture next year, and there’s lots of people who have a similar spirit of ourselves and they are aviator and the airmen out there, so I have to introduce myself and introduce our product and introduce the feeling of what our aircraft does. Someone said yes, someone says no about our product, but those critics help, I think. Tim: Yeah, I mean, that makes sense. I mean, it’s a much slower process but it’s basically the same user feedback process that all startups go through. One thing that’s surprising to me, so taking a little over two years to go from concept to prototype, and then another, let’s call it a year from a prototype to beta users, the experimental users, that’s not that long of a product cycle. That’s pretty fast, and yet innovation in aircrafts seems to happen very, very slowly. We talked before about flying cars and how, like, startups have been teasing us about flying cars for the last 70 years. Why is it so difficult to innovate in aerospace or in aircraft in particular? Tasuku: I think it’s very difficult to think things integrated into one piece which is flying. Also, there is lots of restriction about getting certified to say this is safe. Other products, even mobility, for example, e-bikes or the electric car is a bit different from those white restrictions, safety restrictions are much more harder than those products. Tim: So there’s two things in there you mentioned. I’m curious because you mentioned, like, the real technical challenges of all the pieces that have to work together and kind of the regulatory challenges. So actually, when we think of, like, satellites and aerospace startups, there’s a lot of innovation going on in satellites, a lot of startups doing that, but you would think that aircraft would be simpler to make than spacecraft. Is that the case or is the aircraft actually more difficult? Tasuku: It’s a very difficult question about that. I think that satellite has, there’s a lot of methods out there. Recently, even in the university, there is CAN-SAT that is a sophisticated structure product that the university students can learn how to develop those kinds of things into a real product, and also, there is actual know-how connected to the actual products in this commercial market, in the satellites market, but there’s lots of people involved in aircraft, it’s not connected to the prototype in the university, I think, and also, it’s not connected to the actual product in the general aviation market because lots of big companies are building their product but there’s no experimental things that people or young men or others can learn about, well, aircraft things more easily. Tim: So it’s just harder to get started with it? Tasuku: Yes, yes, this are very few opportunities to get started with making a new aircraft, but the experimental aircraft culture can learn to follow this and learn about new things, but that’s not so much has a market. For now, the drones and eVTOLs are more closely connected to the Internet, involving lots of people. So recently, it’s more friendly and there is more chance to connect to the commercials. That allows people to get into it, so there’s lots of startups data recently building eVTOLs. Tim: Oh, so I haven’t really thought of it, so it’s not necessarily the technical challenge, it’s just that the ecosystem for satellites and aerospace is much better developed than the ecosystem for aircraft? Tasuku: I believe so. Tim: We were talking about the experimental aircraft market, the pilots who fly experimental aircraft. How big is that worldwide? Tasuku: That market is basically based in the United States only.