Hermeus has secured $350 million in funding, reaching a valuation of $1 billion.

      The Los Angeles defense startup conducted a flight with a demonstrator comparable to the size of an F-16 in March. A third aircraft is currently in development. CEO AJ Piplica emphasizes that to construct hypersonic aircraft at this speed, it's essential to recognize that hardware failures will occur and to plan accordingly.

      Hermeus, a defense aviation startup based in Los Angeles focused on autonomous hypersonic aircraft, has secured $350 million in a funding round that values the company at $1 billion. This round includes $200 million in equity, spearheaded by Khosla Ventures, with contributions from existing investors such as Canaan Partners, Founders Fund, In-Q-Tel, and RTX Ventures. Additionally, new contributors include the venture fund of media giant Cox Enterprises and the publicly traded closed-end investment firm Destiny Tech100, among others. The remaining $150 million comes in the form of debt, structured to minimize dilution as the company expands its hardware manufacturing.

      Founded in 2018, Hermeus has been developing what it claims to be the fastest unmanned aircraft in progress. The company follows a deliberately iterative approach, creating one aircraft each year, with each version aimed at overcoming a specific technical hurdle on the route to achieving Mach 5 hypersonic flight. Last month, Hermeus successfully flew its second and largest demonstrator to date, which is roughly the size of an F-16 fighter, marking the company’s second first flight within a year. A third aircraft is now in the works.

      In an interview with TechCrunch, CEO AJ Piplica stated that hardware failure should not be viewed as a risk to evade but rather as a milestone to be planned for: "Yes, we could crash an airplane, and I anticipate that it will happen at some stage in our development program. We're prepared to handle that very safely."

      A crucial decision made a few years back has positioned the company for the current fundraising environment. Initially, Hermeus was developing its own engine from the ground up, partly out of necessity. However, after receiving investment from RTX Ventures, the corporate venture branch of RTX Corporation (formerly Raytheon), the company gained the opportunity to collaborate with RTX subsidiary Pratt & Whitney. This partnership involves modifying the F100 engine—used in the F-15 and F-16—to power Hermeus's hypersonic aircraft.

      This strategic shift provided the company with a proven, operational engine baseline for testing and iterations, reduced the timeline, and opened doors for government contract opportunities that wouldn’t be available with technology-risk bets alone. President Zach Shore remarked that this arrangement creates overlapping incentives that concurrently advance the technology, meet immediate Department of Defense requirements, and enhance the business's economic viability.

      The funding round emerges during a time when defense technology is garnering investment at levels not observed in years. Data from PitchBook referenced by TechCrunch indicates that global venture investment in defense tech exceeded $9 billion across 265 rounds last year, with corporate investors alone providing $2 billion in 28 rounds. The new funding will be allocated to further expand manufacturing capabilities and workforce. Piplica identifies SpaceX as the closest model for a company that is willing to build, test, fail, and iterate quickly enough to genuinely transform possibilities, noting that the greatest obstacle Hermeus faces is not related to capital or technology but rather to talent, as very few individuals with this type of experience are available.