🛰️ 360 Stories: Preligens (ex Earthcube), or “who dares wins”

🛰️ But first: what does Earthcube do?

As a refresher, Preligens develops a security and defense AI software that improves the productivity of intelligence analysts, tipping them off about relevant information on monitored sites. Concretely, the solution analyses satellite images of critical sites and automatically generates alerts on any abnormal activity. Its clients? Tier One Intelligence agencies, looking to value 100% of their acquired imagery data.

🛰️ So how did it start?

Little precision on the timeline: Alexandre, then Principal and now Partner @360 Capital, first heard of Earthcube in April 2017. A friend working for another VC had forwarded the opportunity; Earthcube didn’t really fit in his fund’s strategy, but he had been impressed by the founders and thought we should take a look. First meeting was set 7 days later, and a “Grand Oral” (the official pitch in front of the whole team after which we decide -or not- to put a termsheet on the table) two months later. We closed in July.

🛰️ Why we invested

We at 360 Capital invest at an early stage in deeptech solutions: we look for ground-breaking tech and cutting-edge tools fueling the future of automation – which explains why Earthcube caught our eye.

So why did we invest? Two factors, as always: a great team, and a right market timing.

To get a better grasp of the market of earth observation, companies spend 3Bn$ per year to analyze satellite images. As the number of available images is exploding and their cost is going down, the existing paradigm still largely relies on manual analysis by dedicated analysts, which is not scalable.

This unprecedented growth in available data, which couldn’t be met by the existing human capabilities, opened a boulevard for Earthcube to deploy its solution. At the time, it had developed a tech able to detect changes between two satellite images, and was receiving some commercial interest from the civil market (including the CNES).

As for the team, to give you some context to the two founders’ backgrounds, they’re brothers-in-law (family first, the kind of set-ups we like with our Italian DNA 😉 ). Arnaud, the CEO, graduated from Centrale, and was Chief of R&D at Areva before launching Earthcube. Renaud, who graduated from Supélec, and is armed with a PhD in space data analytics, was a data scientist at Airbus Defense and Space. Both knew their market inside out and understood what was at stake.

🛰️ 360 Capital & Earthcube: a VC love story

Now you know why we chose Earthcube. But why did they choose us?

“We selected 360 Capital as our historical investors because we got great feedback from their entrepreneurs, and were seduced by their direct approach, and by their trust: we really felt that they believed in our capabilities. And then it was about the fit we had with Alexandre.”.

How has our collaboration been going? We feel the best value that we can add to the table is in areas such as key decisions that require a higher-level view, support in the fundraising strategy and networking.

As for strategic decisions, the year following our investment, in 2018, we started to sense that most of the new signed contracts were deals in the world of defense rather than in the civil market. Indeed the civil market didn’t offer as many interesting use cases, as the pool of imagery data wasn’t as important and the revisit rate wasn’t as high. In the defense world, on the contrary, images were proprietary and were rife. Two numbers that confirm that:

– 95% of imagery data in defense is not processed at all by analysts, while the other 5% is painstakingly analyzed manually

– As R. Cardillo, US National Geointelligence Agency Director, put it, “we would need 6 million analysts to look at all the imagery we acquire” (2018)

Earthcube shifted to defense mid-2018: it seems to have been a good bet, as revenue soared in 2019 with defense deals in France and worldwide.

Arnaud and Renaud had the courage to penetrate the difficult market of defense (its long sales cycles can be scary), and at 360 Capital we believe it’s our role as VCs to back risk-taking entrepreneurs that dare to have guts. We supported them in a rational yet risky strategy, and will continue to do so in the coming years.

On another subject, the question of launching a new investment round soon came up: our primary role in these situations is to first determine which KPIs will be necessary to be in good shape for the next fundraising. Rather than precipitate a Series A, we advised for an internal round with great conditions for the Founders, as we felt a bridge would allow them to reach the right KPIs and would put them in a strong position to go look for external money the year after. And this is what happened, with a great roadshow beginning straight after lockdown and concluding now.

🛰️ What now?

Earthcube has since become a well-established reference in the world of defense, and has attracted great talents, such as General Grégoire de Saint Quentin, who was previously at the head of the Commandment of Special Operations and Deputy Chief of Defense Staff for ‘Operations’. His expertise at the highest levels of responsibility in the Army will no doubt be a great asset for the development of the company, as will be the new partnership with Airbus Defense and Space to launch a new solution leveraging high-resolution images from Airbus’ satellites.

Cheers!

Article by Selma Gasc @360 Capital