Walmart announced this week that they’ve made an investment in on-demand drone delivery startup DroneUp. The latter provides delivery services to its customers via on-demand access to its network of over 10,000-strong pilot workforce
The deal is an evolution of Walmart’s existing relationship with DroneUp, who the company partnered with in 2020 to launch trial deliveries of COVID-19 test kits. According to this week’s release, Walmart and DroneUp delivered hundreds of kits and were able to do so much faster than typical delivery.
In DroneUp, Walmart has invested in a leading third party drone delivery services company. DroneUp was the first services operator to use the FAA part 107.39 waiver which allows them to operate drone delivery services over people and cars. Additionally, the company arguably operates the closest thing to an Uber-for-drone delivery platform with its patented technology that matches delivery jobs with pilots in local proximity to a job and sends them an offer through an app.
For Walmart, the DroneUp deal lines up with the company’s past strategy of working with third-party delivery providers rather than building their own drone delivery technology and workforce. This approach contrasts significantly with Amazon, who kicked off the world-at-large’s interest in the idea of drone delivery when Jeff Bezos famously debuted the PrimeAir drone on 60 Minutes.
So while Amazon (and Google) have both built their own proprietary delivery drone platforms as well as invested billions in all that goes into building their own drone delivery networks, Walmart is essentially sidling up closer with a company that turnkeys much of the work for them. DroneUp already has access to a geographically dispersed and wide network of pilots and has all the regulatory approvals needed to start delivery immediately.
According to the announcement, Walmart will begin its first trial of on-demand local delivery in its home town of Bentonville, Arkansas in the next few months.
