Malaysia’s agricultural technology drone solution provider, Poly Dragon, Today announced that it had raised US$4.29 million (RM18 million) in the seed round of financing.Led by Wavemaker partners, Other investors include Malaysia Technology Development Corporation (MTDC), Zhongbao Capital Co., Ltd., There are some angel investors.
Poladrone was founded by Cheong Jin Xi (JX) in 2016, and early took advantage of the lack of participants in the agricultural sector. Since then, more and more competitors have joined the competition, but Paulard still focuses on developing drones in the field of agricultural technology, because JX believes that the industry still has many unresolved pain points.
With new funding, Poladrone intends to expand its drone technology business in Malaysia.
The potential of drones in agricultural technology
Over the years, the use of drone technology in Malaysia has been closely related to agricultural technology, and more and more participants have emerged to develop the industry.
Since Poladrone’s operations and development are mainly based on this field, JX told Vulcan Post that the early use of agritech put the company in a leading position in understanding market dynamics.
“[It’s] An industry with huge market potential but challenging technology commercialization [in] Due to low profit margins, lack of skills in the labor force, over-reliance on foreign labor, Internet connectivity, road accessibility and many other factors,” JX elaborated.
Therefore, what has been learned from multiple trials with customers aligns the focus of the team so they don’t have to worry about competitors, but instead focus on getting the right unit economics.
For example, develop reliable products and build an ecosystem through accessible service centers to make it sustainable to provide customers with long-term dependence.
Recognize that drones replace ground-based labor
Poladrone focuses on the agricultural sector and has made advancements in its technology through innovations such as Oryctes, which was launched in August 2020.
Oryctes is named after the rhinoceros beetle, a pest known to be harmful to oil palm crops and can reduce fruit production by up to 25%.
In order to reduce losses that may total up to RM40.25 billion, it is necessary to spray pesticides frequently to keep plants healthy. However, the use of knapsack sprayers and tractors are labor-intensive and harmful to workers’ health when inhaling chemicals.
In addition, the labor shortage caused by the pandemic has led to the need for drones that can replace human labor, and Oryctes was developed to do just that.
Oryctes uses real-time kinematics (RTK) positioning, edge AI and custom nozzle settings to spray dots with centimeter-level accuracy, making it a useful tool for oil palm crops.
According to JX, oil palm plantations that have adopted Oryctes in the past year have reported:
- Increase labor efficiency by 5 times (replace 5 foreign low-skilled workers with a local high-skilled drone pilot);
- Reduce operating costs by 20% (by replacing manual sprayers);
- Appropriate documentation of pesticide use records to comply with environmental sustainability;
- Reduce human exposure to harmful chemicals;
- Consistent measurement of pest damage control;
- Regardless of the terrain, the operation will not be affected (by replacing manual workers and tractors that behave inconsistently due to ground conditions).
In addition, Poladrone also offers its Mist Drone (mobile smart sustainable technology). This is a spraying drone that can spread a large area of chemical coverage, and is most suitable for blanket spraying on large open-air crops such as rice fields.
But you still need labor to service the drone
Since the drones of this startup are manufactured locally, Poladrone’s service center will support services such as customization and drone maintenance.
Just like servicing your car on a regular basis, these centers are designed to ensure that drones always operate at the highest quality. If they work as expected, users can rest easy when using the technology in their daily spraying workflow.
Currently, the newly established service center in Kluang, Johor aims to provide service support, regular maintenance and replacement of spare parts.
“Next, we will open a center in Alor, Kedah to serve the northern market, followed by Tawau Bintulu Telok Antan. The goal is to open 10 locations by the end of 2022,” JX said.
With the ambitious expansion plan, it also needs to expand its workforce, and Poladrone intends to use its $4.29 million in seed funding to do so.
“There are two main reasons for our seed round of financing. First, to build a world-class team, to further improve and optimize our industry solutions. Second, to allow us to quickly expand our business and set up service centers (in Malaysia and Area),” JX explained.
As a profitable company, JX stated that Poladrone has no urgent fundraising intentions and is satisfied with organic growth.
However, with the rapid adoption of drone technology solutions during the pandemic, Poladrone faced the need to expand its team fourfold. In less than a year, the number of Poladrone employees has increased from 20 to more than 80 to meet demand.
“Therefore, we are almost obligated to expand the scale of our business and bring the benefits of our technology to more people at a faster rate. This is one of the main drivers of our decision to raise funds,” JX said.
Next destination: Indonesia
Currently, Poladrone has established operations in Thailand and is now focusing on expanding into Indonesia, as most of the company’s solutions are customized for the oil palm industry.
JX said that Indonesia has the world’s largest oil palm plantation area, even ahead of Malaysia, which brings huge market potential to Poladrone.
Since the launch of Oryctes, the Poladrone team has even received requests from Indonesian plantations and purchase orders from large estates. “However, we did not ship any products because we were not confident in providing after-sales support without first setting up an office in Indonesia,” JX revealed.
Therefore, it was a wise move for JX to first focus on strengthening its market share and products in Malaysia, rather than expanding ambitiously without a strong foundation.
Featured image source: Cheong Jin Xi, Founder of Poladrone