Snap acquired US-based drone manufacturer Ctrl Me Robotics for less than $1 million, BuzzFeed News reported, which could be a means for the Snapchat maker to expand into hardware and diversify its revenue sources.
Simon Saito Nielsen, the founder of Ctrl Me Robotics, will join the app maker as part of the deal, which was “something of an acquihire”, BuzzFeed stated adding the drone company was on the brink of closing down before approaching Snap regarding a takeover.
Snap already produces hardware in the form of its Spectacles, which feature an integrated video camera and connect directly to its popular Snapchat app.
While there was a lot of hype around Spectacles when they launched in September 2016, Snap’s first results since going public revealed the sunglasses only generated around $8 million of the company’s $150 million revenue in Q1 2017.
The overall results also failed to impress, not least because Snap faced competition from companies including Facebook and Instagram, which cloned its app’s most popular features. Such rivalry is a key factor in Snap’s need to generate revenue from new channels.
According to BuzzFeed, the acquisition suggests Snap is taking a serious interest in hardware, and drones could be a good space to explore, with drone photography and video garnering popularity on social media.
Nielsen founded Ctrl Me Robotics in 2013 to provide aerial footage capture tools to movie studios. The startup raised some seed funding in 2014, but never really took off. Its website was taken offline.
In 2016, Snap was reportedly in talks with Lily Robotics, a drone startup which took orders worth $34 million before it filed for bankruptcy.
Reports in early 2017 said Snap also constructed its own drone.