Sea Machines, the Boston-based developer of self-driving technology for boats, has raised a $15 million Series B round.
The round was led by Huntington Ingalls Industries, America’s largest military shipbuilding company, with participation from Toyota AI Ventures, Brunswick Corp. (through investment partner TechNexus), Geekdom Fund, NextGen Venture Partners, Eniac VC, LaunchCapital and others.
For CEO and co-founder Michael Johnson, the new partnership with Huntington Ingalls is perhaps the most exciting part of this announcement. The company largely serves the U.S. Navy and other government agencies, representing a new market opportunity for Sea Machines.
"We’ll be serving that partnership and adding staff to serve that growing market as well," Johnson said.
Raising this round, in the midst of a global pandemic, was very different from raising Sea Machines' $10 million Series A round in 2018, Johnson said, although it took less time to secure the funding now that Sea Machines' technology is on the market. Johnson did not have a single face-to-face meeting with an investor—but remote pitches proved to be an advantage for the startup.
"It really enabled us to showcase our technology in a more direct way," Johnson said. "We did online remote demonstrations, where we had our demonstration team, via teleconference, conference into our vessels off Boston Harbor. We were really able to get the investors into a captain's chair, as if you are remotely commanding a vessel in real-world operations. That worked out well."
Sea Machines launched its first two products, autonomous vessel system SM300 and remote-helm control system SM200, at the end of 2018. Now, as it expands its customer base and collects feedback, Sea Machines is working to improve on those systems and scale its engineering and development team accordingly.
Johnson expects to hire in its East Boston office as well as its office in Hamburg, Germany, to better serve a global market while Americans are prohibited from traveling to at least 33 countries. Sea Machines' European presence is also growing with an office in Rotterdam in the Netherlands.
"The world is being revolutionized by autonomous technology," Johnson said. "Sea Machines is the company that's leading the transition in the oceanic and maritime space. It's important for folks to understand. Us Americans, we tend to look inland. But 70 percent of the world is covered by water, and 5 percent of the world's GDP is coming from that ocean economy. It's a huge market."
Sea Machines was one of BostInno's 50 on Fire winners in 2019.
