Zipline, a drone-based medical supplies delivery company, has raised USD 250 million in a funding round led by Baillie Gifford with participation from Temasek, Katalyst Ventures, Fidelity, Intercorp, Emerging Capital Partners, and Reinvest Capital. This round raises Zipline’s total funding up to USD 486 million, valuing the company at USD 2.75 billion. 

The company intends to use the new funds to expand operations in Africa and the US, build the necessary infrastructure for signed contracts including five new distribution centers in Nigeria, four in Ghana, and several service contracts with hospitals in the US.

Zipline primarily operates in Rwanda, where it delivers medical supplies to remote health facilities. It also has operations in Ghana, Nigeria, the US, India, the Philippines, and Japan. Zipline has run pilot operations in North Carolina since 2019 in partnership with companies including Novant Health and Walmart. Earlier this month, Zipline also partnered with the pharmaceutical company Pfizer, to deliver Covid-19 vaccines in the markets where it operates. Overall, the company has completed more than 155,000 commercial deliveries to date—mostly in Africa.

Analyst quick take 1: Zipline is one of the most drone delivery advanced startups and is the second largest in terms of funding and valuation within the LMD automation space—behind only Nuro). Its new valuation reflects a 2.3x increase since its USD 120 million Series D that valued the company at USD 1.2 billion in May 2019. 

Analyst quick take 2: While the company has established operations in Africa, its US operations are still conducted under an emergency waiver granted during the Covid-19 pandemic. As such, a key factor for US growth will be obtaining full commercial operation certification from the Federal Aviation Administration (FAA), which is reportedly currently underway.