UAS company heading to North Dakota
UND Center for Innovation collaborative effort helps open the door
A Kentucky manufacturer specializing in heavy-lift drones is bringing its manufacturing operations to Grand Forks, N.D., thanks to an effort that involved the UND Center for Innovation working in collaboration with federal, state and regional economic development organizations.
“It’s a good neighborhood to be in,” said Tom Nickell, CEO of Mobile Recon Systems (MRS), the Lexington, Ky., company soon heading to North Dakota. He noted that the UND John D. Odegard School of Aerospace Sciences, the UND Research Institute for Autonomous Systems (RIAS) and the Northern Plains UAS Test Site offices are all within walking distance of where the company will initially set up shop in the Center for Innovation.
Amy Whitney, Center of Innovation director, said MRS will use the UND facility for its “soft landing spot” by initially opening an office there. Nickell said the company could begin setting up as early as this week and will eventually relocate its offices and manufacturing operations to a more permanent location.
“We were looking to expand and looking for areas that have a skilled workforce, research support and people knowledgeable about the UAS (unmanned aircraft systems) industry – really all those things that go into an ecosystem,” Nickell said. “We looked in several states, including Kentucky, Oklahoma, New York, New Mexico and Virginia. Over the months of that research, we really zeroed in on North Dakota because of what it offered with all of those factors.”
A first for Grand Forks
Brandon Baumbach, business development manager with the Grand Forks Region Economic Development Corp., said, “After many years of hard work, Mobile Recon is the first small UAS company recruited to Grand Forks from outside the region. This was a true team effort, and UND was a great partner in this effort.”
Whitney said bringing MRS to Grand Forks is the result of a collaboration of state, regional and local entities working together to build an ecosystem to attract innovative UAS companies.
“One of the exciting things is that UND and the region are really working hard to have a talented and trained workforce in the UAS industry sector,” she explained. “We have the ability to help them connect with that UND talent. We have the ability to help them create that network. We can help them find the people they need to on campus so they can connect to those resources and also make sure that they are networking and creating connections with other workforce initiatives that we have in the region.”
Nickell called the Center for Innovation “a wonderful resource,” and added, “I’ve seen a number of different business incubators, but I haven’t seen any that are better or comparable to what’s up there at UND. It made it an easy decision to put a flag down in Grand Forks.”
The $1.2 million financing package enabling MRS to bring its manufacturing operations to Grand Forks includes a $400,000 loan from Choice Financial Group, with 50 percent guaranteed by the Bank of North Dakota and 25 percent guaranteed by the Red River Corridor Fund. Another $400,000 in equity is being provided by the North Dakota Development Fund. The Grand Forks Jobs Development Authority Economic Development Administration Revolving Loan Fund also is providing a $400,000 loan.
Nickell said the ability of North Dakota agencies to develop a funding package was another major factor in the company’s decision to move to Grand Forks.
“It may be unique in the country,” he noted. “Just being able to get the loan package put together, I don’t know of any other state that would be able to do this for an early-stage company like ours.”
The wheels for the MRS move began to turn just over a year ago after the U.S. Economic Development Administration (EDA) awarded the Center for Innovation a five-year grant to support the expansion and commercialization of autonomous businesses – which includes UAS – in northeastern North Dakota. Whitney said the North Dakota Department of Commerce is an important partner in the project, providing matching funds for its first year.
“When the proposal came into EDA, the idea was that we could support the state’s initiative to diversify the economy of North Dakota,” said Stacey Webb, project officer with the EDA’s regional office in Denver. “The focus and the level of collaboration that UND has with the state, with other universities, with economic development organizations and with Grand Forks Air Force Base is what really stood out.”
The EDA grant enabled the Center to hire Renee Shelton as a commercialization specialist who focuses on economic development opportunities with autonomous systems companies. Through the Center for Innovation, she refers new companies to the region to establish operations at the Center’s incubator, which assists them in entering the regional market and receiving commercialization services.
Building the UAS ecosystem
“The EDA grant really allows us to focus intentional efforts on helping to support the exciting work that’s happening in the UAS and autonomous ecosystem here in North Dakota,” Whitney said. “It allows the chance to really help facilitate collaboration and cooperation among all the partners in that ecosystem, and be able to dedicate resources from the center through Renee’s efforts on the grant to make sure that we can move that industry sector forward.”
Webb said that by bringing MRS to North Dakota, the Center for Innovation had already exceeded expectations.
“I was glad to hear that there have been some immediate results from the EDA award that were going to lead to economic impact, job creation and private investment down the road,” she elaborated. “We don’t often see success stories this early on because the award was just made a year ago.”
According to Nickell, MRS is focused on the commercial, industrial and military markets with its two current products, the Dauntless and Kittyhawk UAS quadcopters, each capable of lifting the heaviest payload in its class. The Dauntless can carry a 200-pound payload while the smaller Kittyhawk can lift up to 26 pounds. Applications for the company’s UAS include: supply transport; aerial inspection analysis; surveillance; search and rescue; supporting first responders during emergencies; and mapping and topographical surveying.
The company has two UAS prototypes under development that are ready to enter production, Nickell said. It’s also working on new power sources for its drones to increase their payloads and flight endurance. He said MRS expects to make use of facilities at the Northern Plains UAS Test Site to further develop its designs.