How New York Angels is Helping SkyFire AI Soar!

This transcript has been AI generated. Please excuse any typos.

Drones have been fun consumer products for years now, while entrepreneurs are figuring out their commercial use and new ideas are coming all the time. Today we meet Don Mathis of Skyfire, along with Bob Peck and Alyssa Tam from the New York Angels. They both led Skyfire’s seed investment round that’s helping the company scale.

Skyfire has big plans for enhancing our nation’s defenses, simplifying business logistics, and even helping public safety officials save lives. Welcome back to this New York Angels edition of the Angel Nest. I’m David Hemenway, I’m a five-time founder and a member of the New York Angels, where we fund and mentor great young companies.

As an ex-Navy flight officer, Don Mathis watched while drones changed the narrative in Ukraine’s war with Russia. The COVID pandemic also created some public health challenges that no one had faced before. He decided it was time for Skyfire, a platform that utilizes the more sophisticated level two drones to enhance public safety at scale.

He’s here to tell us how he’s doing that, along with Bob Peck and Alyssa Tam from the New York Angels. Thanks everyone for joining us today. Thanks for having us.

Thank you very much for having us. Don, give us some good use cases for how Skyfire is helping its clients be more efficient, and the best part, right, is even save lives. Oh, thank you.

Yeah, it’s incredible to be here, incredibly a part of the New York Angels family, and to have the opportunity to talk about what we can do here. So briefly, we do a lot of missions across the public safety space, commercially adjacent categories, and we’re beginning to emerge into defense. But I think about a few use cases where I think it demonstrates the power of what we’re able to bring to the table.

So one in particular, I can think of in Birmingham, Alabama, we had the case of police responding to a domestic violence case. And this was just a terrible case where the neighbors had reported the sounds of the violence. As the police cars were coming in the background, the perpetrator escaped out the back door of the house.

And in normal circumstances, it would have been days or maybe weeks before he was apprehended unless police got lucky. In this particular case, the first responder on the scene was actually a drone. And the drone, which was our drone, was able to follow the perpetrator as he escaped out the back through the woods into another subdivision and ultimately arrested him on the spot, thus bringing to conclusion a case that would have otherwise lingered for a long time, consuming resources, but more importantly, adversely impacting the victim involved in particular and leaving her still at risk.

Yeah, that’s just amazing. That’s amazing, yeah. Thank you.

Another use case, I think, that highlights the power of it, hurricane response. We were actually able to use multiple drones flying autonomously and in what we would consider to be a swarm or a multi-ship formation to be able to help authorities in North Carolina look for missing people. There was a number of search and rescue events that we were involved in and also to deliver critical medications to people who otherwise had no access to get to those medications.

Between both of those, we were credited with saving 13 lives. And I think for the team, it was an incredibly powerful moment. That’s great.

So I want to bring in Bob Peck and Alyssa Tam and New York Angel Investors because, you know, Bob, I know we’ve looked at a lot of drone companies and the technology is always cool and the application is great, but often it’s something that in the end, we decide that whoever the client company is could grow into doing themselves. And yet Skyfire seems to have a lot of levers to pull here to stay innovative and competitive. Yeah, you know, I got sort of lucky in that I was lucky enough to meet Don over 10 years ago at his prior startup, which he was fantastic at and had a successful exit with as well.

So when he came to the New York Angels to present and I saw him there again, immediately I perked up because I knew whatever he looks into, whatever he works on usually ends up being very successful. So I started listening to the whole pitch, thought it was fantastic. Yet as we started digging into the numbers, right, we saw the growth in clients that he was having over the years, right? We saw the expanding revenues.

We saw in some cases where he was going from, you know, a couple of first responder units departments to whole statewide type deployments. And so we just saw this tremendous momentum. And what really occurred to me was that, you know, based on this success, the knowledge base he was building, the data they were accumulating was creating moats for other competitors.

So it just seemed like a very unique opportunity in Skyfire versus some of the other companies we saw were great technology, but it was more difficult to sort of see where the moat was for other competition coming forward. Yeah, and you said something that I think is important kind of alluded to it, right? How much of it is the idea? How much of it is the business model? How much of it is the entrepreneur? Yeah, absolutely. I think all three obviously interplay together, right? But at the end of the day, the entrepreneur to me is the key part because that’s the person that needs to pivot and move and adjust as the story continues to grow and change.

So having someone who can see around some of those corners and be able to put the company in the right path no matter what comes forth is extremely valuable. Right, because Alyssa Tam, we know that wherever we end up, it’s not going to be where we started out probably, right? What attracted you to Skyfire? Right, so, well, thank you for having me today. Well, you know, as an angel investors, you know, I look at a few things when I decided to invest in a company.

So the first, it’s, you know, the problem the company is solving. Is it a problem? Is it solving a real problem in a community or a society as a whole? Is there really a need for such a solution? And is the solution unique? And I think Skyfire AI solutions as Don has described it and the use case he just shared address a real issue that resonates very much with me. For example, with one of the customer, Skyfire’s capabilities position them to help address pharmacy deserts, which is, you know, underserved regions with limited access to pharmacy service where drone delivery can provide very high impact solutions.

And secondly, you know, customer validation has the idea of being validated by customer. And as part of our due diligence process, we spoke to, you know, a couple of customers about Skyfire AI and we received very strong feedback from all of them. And thirdly, the traction, you know, does the company has traction? And at the time Skyfire AI came to us, they have already gained significant tractions in the public safety space, as well as healthcare company in the commercial space.

And of course, the growth potential is there. And the founder, Don, who’s an ex, you know, ex Navy flight officer and who’s deeply committed and driven. And lastly, you know, as an investor, we talk a lot about returns, but we don’t talk enough about the causes that we support.

Skyfire AI was one of those that not only is a great company, but also it is also the cost it supports, which many of us at NYA resonate with. Yeah. Don, tell us some of the other areas Skyfire is getting into and how you’re going to maintain a moat.

It’s a great question. I think our core focus right now is around that public safety category, says police, fire, EMS. And then we look at categories that are adjacent to that because it is a multi-use technology.

So I think one of the things that attracted me to the very concept in the first place, why I got involved in helping create it and then attracting other people to join me was the idea that you could have a core capability that immediately solves a problem, but also had that growth potential over time. If you look at, say, for example, getting involved in the defense market, helping defend different assets, for example, from a military perspective, that’s a very rich market, but it also takes months and months and months, sometimes years to get to the point of closing the transaction and you have to spend a great deal of venture money typically in advance of that, almost feels like biotech as you’re kind of building out the company. What was so attractive about this concept to the core team that founded it was that, hey, we could actually go into market and immediately solve a use case or a set of use cases around public safety.

You’d be training the models as part of the process. Core capability is fundamentally the same, whether you’re looking at a defense use case, whether you’re looking at a commercially adjacent use case like high-end, especially drug logistics, security. We’ve got some great event security that we’ve been chosen for very recently that we’re gonna be doing in 2026.

And then bread and butter within the law enforcement, fire, and EMS world, was a very powerful way for us to get into it. And it was meaningful for me personally because I have a lot of family who have been first responders over the course of generations. And this feels like my way of contributing to that.

Yeah, so now is AI your friend or your foe? Oh, it’s our friend. Yeah, we’re really fundamentally an AI company, first and foremost. Our CTO came from DARPA, and he would tell you that fundamentally the core mission as he sees it is AI to create autonomy for robotic systems that are employed in really critical use cases, whether that’s high intensity, highly dangerous to people type use cases.

And that’s part of what motivates all of us. How can we keep people safe by using systems in place of where you’d normally put a person? A drone is a flying robot. So that’s why we started with drones and law enforcement security use case.

Yeah, so not only have you built a book of business and you have a bunch of verticals you’re chasing, you also successfully raised money, which not everyone is doing these days. So tell us what that experience was like. You know, it’s certainly not a trivial experience.

I think starting when we started, which was very late 2022, as in December of 22 and early 23. So in a little bit over three years, we’ve been in existence. Those three years happened to have coincided with, you know, Alyssa talked about pharmacy deserts.

There’s also been a capital desert for a while for early stage startups. Unless you’re actually one of the foundational model AI type companies, or a handful of players pulling in capital from venture funds at that level, you know, think Sequoia or Adresin or Battery and so on, it becomes much, much more difficult to get your story across, get your message out there. And I actually think it’s a good thing.

It’s easy for me to say that now after the fact, but the reason I think it’s good is because the bar’s high. You really have to demonstrate that you’ve got a great idea, but you’ve got a good execution around it. And the execution is paying off in the form of creating a real business with real results, real scale, real product go-to-market fit.

And I think that’s what we were able to do here, which is what opened the door. I’ll say the second thing is we were able to get really great partners by going after the angel community in general, and New York angels in particular. Yeah, so angel investors always wanna add more than money.

Are we doing that so far for you? Oh man, yes. You know, our thesis going in was that it’s a relatively immature market. And I think time has only proven that out.

It’s starting to achieve some degree of maturity now, but it’s been very immature for a number of years, even while people talked about the promise of it. So for us, I think the idea of finding angels who fit, first and foremost, the angels can be, venture funds tend to follow, angels tend to lead, right? And so you’ve got people who have just as much and often much more experience than an average venture investor might. In addition, there’s sort of the wisdom of crowds, right? You get a bunch of very smart people in a room and they’re able to really evaluate an option, divide and conquer.

And then from our point of view, what that meant was, number one, the due diligence we did makes us a better company for the future. So we benefited from a rigorous due diligence process. Number two, more importantly, you’ve got people who have connections all over the world.

And if you’re gonna pick an angel group, obviously New York Angels sits at the epicenter and is one of the most well-established well-known angel groups in America. I say that in part because that’s what attracted us into the pitch in the first place. And it was one of those cases where you knew if you got New York Angels, you could do a lot just on the credibility of that investment.

And so far we have, it’s opened the doors for business development relationships. It’s opened the doors for additional capital. It’s also been a source of sound advice.

So it’s really been great. Bob and Alyssa, were you looking for an opportunity in the drone space or was it just a matter of right place, right time and right operator? The way I looked at it was I’m always looking at, I’m a technology investor and my whole career has been in technology. So I’m always looking for emerging technology that can disrupt and have huge towns in front of it.

So drones was definitely on my list. I think the biggest things I mentioned earlier though was what was defensible, right? What was a model that has a long-term sustainable business and that’s what attracted me. Alyssa, I don’t know what you think.

Yeah, I mean, it’s like Bob and AI and drones are definitely on the list of, top of the list in terms of investments. But is it at the right time, the right place, the right people? Yes, because we rarely come across a company that has combinations of both, right? Everyone, many companies that came through the door at NYA now are AI companies. But Skyfire has been a very special, a unique company to us because it combined, basically combines two emerging technologies into one.

And again, I said that just now, it’s providing a solution that resonates to me at least. And then, and of course, as an outcome, many of us, as evident in how many of us have invested in the companies. Yeah, and Don, were you able to get investment from the New York Angels Sidecar Fund as well? We did, we were fortunate enough to have the main fund plus the sidecar.

Yeah, that’s fairly unusual, right? I defer to my colleague. Yeah, so I, yeah, it is, it is. I mean, if you’re a startup, a company that came to NYA and have investment from both the individual investors as well as the sidecar fund, that’s very, very special because, so basically the sidecar fund is a vehicle to help amplify our investments.

So it’s basically leveraging on the wisdom of the crowd. So it doesn’t invest in a company if there isn’t sufficient interest from at least 12 members of NYA invested in the company at a certain amount. So you have to reach a certain threshold in order for the fund to come in and say, okay, well, let us take a look at that company too.

And maybe we’ll come in if it meets all of the, you know, qualifying criteria. And SkyFi AI certainly did. Yeah, that’s great.

Yeah, it’s almost a measure of just conviction of the New York Angel Group. So that’s a great way to support the conviction of the members. Don, do you have any international ambitions? We do.

There are opportunities in public safety, but also in defense. As you might guess, we’re very focused on doing anything that we do in this category would be supportive of US foreign policy and our NATO alliances. But there are a number of players in those categories that are looking for enhanced drone capabilities.

Obviously, current circumstances, if you will, current news highlights the risk of drones from flying by an adversary. So there’s that question and that component to it. And we haven’t talked a lot about that, but to be able to do what we do, we have to have a very good understanding of the airspace.

So that helps in the case of a civilian deployment, we make sure that our drones don’t fly into the path of a civilian airman or a crewed aircraft like a helicopter or an airplane. But just as importantly, if you look at the risk of illicit drones or adversarial drones, that control of the airspace helps. So we’re seeing demand, as you might guess, given current events, demand for that in foreign areas.

We’re not really ready yet to do a lot of overseas work. We’ve certainly had high-level discussions, but we’re about to be. We’re going through a process where we will be cleared by the U.S. government to be able to go and explore opportunities outside of the borders of the U.S. That’s great.

Don, congratulations on a great start and a phenomenal fundraise led by Bob Peck and Alyssa Tam from the New York Angels. It’s a pleasure to have everybody here today. Thanks so much.

Thank you so much, Gary. You can learn more about joining the New York Angels or applying for funding for your startup at newyorkangels.com. And you can reach me and hear more episodes at theangelnest.com. A reminder that we don’t make or recommend investments at the Angel Nest and this program is for informational purposes only. We produce the Angel Nest with help from Rob Higley and Charles DiMantebello.

He’s at the controls of CDM Studios here at the famous Art Deco Film Center building just west of Times Square in New York. I’m David Hemingway. Thanks for listening.

So long until next time.