According to a leading venture capitalist, a big part of the attraction for investors in the nascent advanced air mobility (AAM) sector lies with its enormous potential to fundamentally reshape how people and things move from point A to point B. Speaking at this week’s Vertical Flight Society’s Electrical VTOL Symposium, Cyrus Sigari, a managing partner in the Up.Partners early-stage venture capital group, maintained that new eVTOL aircraft will democratize air travel.

For his opening premise, Sigari underscored the point that one-fifth of the way through the 21^st century, only one in five of the world’s population have ever experienced flight, meaning 80 percent of humanity remains cut off from what he called “the most underutilized resource we have, which is what’s above us.”

Up.Partners actively invests in an array of enabling technologies for advanced air mobility. “I would offer to you that this technological revolution that we're seeing through compounding exponential technologies that have come together have [created] the pathway to perhaps be one of the most important technological waves in our lifetimes, [and] has a potential to really help humanity go forward,” Sigari argued.

According to Sigari, investors should no longer direct all their resources into one sector such as aviation, the automotive industry, or logistics, but rather in a more holistic fashion, one that centers on moving people and goods in what he called a multi-dimensional world. For example, railway company BNSF uses drones to conduct aerial surveys of its rail systems and employs hundreds of pilots to operate them.

“It’s going to continue to take people outside of traditional aviation to come in, to advise us of different problems that we’re not even aware of yet,” he explained.

While the AAM industry has so far attracted a respectable level of investment, the market remains in its relative infancy. Sigari maintained that more money will come as investors see the potential for a market that stands to grow exponentially over the next 20 years, and reach a level that took the automotive industry 120 years to attain. Projections vary wildly, but he pointed to three reports from Porsche Consulting, Booz Allen Hamilton, and Morgan Stanley that forecast a market value of between $250 billion and $1.5 trillion.

“Who knows if they’re right and how long it’s going to take but I think everyone can agree that, directionally, this is going to be really big and happen really fast,” said Sigari. “The next 10 years alone it’s expected to be 50 times larger than the global helicopter industry.”

Some investors already see the potential, and, by some estimates, more than $110 billion has reached companies since 2015. To illustrate how the investment has accelerated recently, Sigari noted that during 2020, AAM drew twenty times the number of investment dollars it saw in 2016.

The reasons for the large volume of investment include, foremost, the readiness of the technology for current applications. Companies such as San Francisco-based Zipline—one of the drone operators in which Up.Partners has invested—delivers blood and medical supplies in Africa and already ships 50 percent of all blood delivered in Rwanda and Ghana.

“You can have blood delivered anywhere in those two countries within a one-hour iPhone request,” he noted. “Every four minutes a drone is taking off delivering life-saving equipment. We were fortunate enough that one of our partners was one of the first investors in Zipline and they are already a multi-billion-dollar company a couple of years later.”

The value of Chinese eVTOL aircraft developer EHang stood at $700 million in December 2019, when it completed its initial public offering on New York’s Nasdaq exchange. In recent days, its value has reached some $5 billion, based on its share price.

“Now, who knows how long this will go up, if it will keep going. If not, I don't think it really matters,” said Sigari. “I think the point is this is emblematic of the future is going in a third dimension and not in the way that we're traditionally trained in the traditional aviation business.”

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