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The Brief Story of DJI’s Entrepreneurship

If you’re a drone enthusiast, you must have heard of DJI.

In a way, DJI defines the consumer market for drones. Before DJI, only model airplane enthusiasts bought and used drones. After DJI, drones became a kind of flying camera that could be used by anyone who could take a selfie.

DJI is from China, but even there, not everyone knows its startup story. Let’s talk about that this time.

The early days of DJI

Wang Tao, the founder of DJI, was born in 1980 to a wealthy family in Hangzhou, Zhejiang Province. His father was an engineer and his mother was a teacher.

Wang Tao was yearning for the sky in primary school. One day, he read a comic book about the adventures of the red helicopter.  He was fascinated and began to dream about the sky. He wished he could build a helicopter exactly like it

In 2001, he enrolled in the department of electronics at East China Normal University, but dropped out during his junior year and applied to Stanford, Massachusetts Institute of Technology, and other world-renowned universities. However, he was repeatedly rejected, because his grades are only above average, not very good.

Wang Tao

After that, he enrolled in the department of Electrical engineering at the Hong Kong University of Science and Technology. During the undergraduate period, he continued to indulge in his aviation dream and participated in the robotics competition twice, winning the first prize in the Hong Kong region and joint third place in Asia Pacific Region. He broke several model planes in the middle of the race. The spinning blades left a scar on his hand. But it gave him the idea to build something that could control a helicopter automatically.

But it wasn’t until 2006 that he successfully developed the technology. Introduced by Li Zeixiang, a renowned Mechanical automation scholar in China, he started his master degree, and at the same time started a company, DJI Innovation, in a warehouse of less than 20 square meters in Shenzhen Sunshine Golf Tower.

Due to frequent absences, it took him five years to complete his two-year graduate degree.

At that time, the field of communication and electronics was developing rapidly in Shenzhen. The electronic market in the center of the city could buy all kinds of electronic chips sold anywhere in the world.

Many of Wang’s classmates started making imitation chips, but he was not interested in the business. He successfully developed and began selling automatic helicopter controls that help helicopters hover without manual control. However, the device was not only expensive, but also has few potential customers. Only model-airplane enthusiasts would want to buy it.

Wang Tao’s favorite thing was going to Anderson’s DIY Drones forum. There, he could feel the power of like-minded people from all over the world, and that was what kept him going.

One day, he saw something that made his eyes suddenly light up.

Wang Tao noted a discussion of the quadrotor UAV post, compared with the single-rotor helicopter, quadrotor UAV has low manufacturing difficulty, smooth flight, high reliability, simple mechanical structure, low generation cost. And it works well with the automatic controls he invented.

In 2011, he took his quadrotor flight control chip to a radio-controlled aircraft trade show in Indiana, where he met an American named Colin Quinn. Quinn was running an aerial photography start-up at the time. He asked Wang if DJI could provide a way to shoot steady video from the air using drones.

Quinn’s demands hit Wang like a lightning bolt. Previously, only model airplane enthusiasts bought drones, so the overall market was small. Why could’t drones do something more useful? Once the stable head was developed, it would open up a whole new market for UAVs.

Wang Tao kept working day and night, in only an intern to do assistant conditions. Three prototypes were developed in a matter of months, and satisfactory stability was achieved. Stunned by this, and realizing the market potential of the product, Colin Quinn decided to give up his career to follow DJI.

The beginning of the DJI`s legend

In late 2012, DJI released its first complete drone product, the DJI Phantom.

Equipped with an external motion camera, the drone could take off within minutes of being unpacked. It completely abandoned the complex assembly and debugging process of traditional drones, turning drones from “toys” for model airplane enthusiasts into “flying cameras” that all ordinary consumers might need.

In the past, at least three people were needed to complete an aerial photograph: one to control the flight, one to control the camera, and one to provide ground support. When DJI introduced the Phantom, many people could buy a GoPro and do aerial photography, lowering barriers to entry. Many professional aerial photography teams in China were even impacted by DJI began to transform.

DJI’s market share quickly climbed to the no. 1 in North America, and its annual turnover exceeded $100 million. This caught the attention of the capital markets, but at this point, any investment was long overdue for DJI, which was already a money-printing machine with unlimited potential.

“Previously, drones had a lot of inconvenience in terms of the operating experience, which shut out a lot of ordinary consumers. We believe that with DJI’s technology accumulation, we can launch a highly integrated product to solve this pain point at one stroke and create value. The success of the Phantom line vindicates our decision.” Wang Tao said.

“DJI’s Sprite 2 Vision was basically an Apple II in flight,” Sequoia Capital partner MichaelMoritz wrote on Linkedin.

Phantom 1 uses the GoPro as a recommended accessory in the demo video. But in the end, DJI did not integrate GoPro into its products. Users had to buy and install their own GoPro cameras, and almost everyone thought that GoPro and DJI would be “made for each other”.

According to Wang, the Phantom 2 product was originally planned to incorporate GoPro cameras. But DJI was dissatisfied with GoPro’s products and attitude, and eventually decided to make its own motion cameras.

In specific negotiations, GoPro wanted two-thirds of the profits from the integrated products, which Wang could not accept. That’s why Colin Queen broke with DJI and left the company.

“They [GoPro] treated us as an equipment supplier, but DJI is not an average OEM.” In an interview with Forbes, Wang tao said there was no agreement on profit sharing and, more importantly, no equal treatment in the collaboration process. That’s why DJI abandoned GoPro cameras after the Sprite 2.

Later, Wang Tao secured chips of the same quality as those used by GoPro from suppliers. Starting with the Spirit 3, DJI used its own camera equipment in the series.

Moving on

After leaving GoPro, DJI’s development was completely unaffected.

In 2014, DJI sold about 400,000 drones. Between 2009 and 2014, DJI’s sales doubled or tripled annually, making it one of the fastest-growing companies in the world. Investors believe DJI could maintain that dominance for years to come.

In 2015, DJI’s net profit increased from $8 million in 2012 to $250 million. Today, DJI has a 70% share of the global consumer-level drone market.

Two lines — “Brain only” and “No emotion” — are written on Wang Tao’s office door. He is a fiery but hands-on leader who consistently puts in 80-plus hours a week, with a single bed next to his desk.

When unsatisfied with an employee’s design, he would simply say: “What rubbish!”

A lot of people think Wang Tao’s personality is intolerable. Even himself also admitted that because of perfectionism, he “often let employees break their hearts.”

In 2015, DJI held a launch event for its drone product, The Spirit 3, in New York. Wang tao, the CEO and CTO, did not attend the event. Simply because “the product wasn’t as perfect as he thought it would be.”

On August 23, 2018, DJI, which has run out of competition in consumer drones, took its revenge on GoPro. This year, DJI first partnered with Swedish camera brand Legend on its drone product, launching the Mavic 2 Pro with a built-in HD camera.

It then launched Osmo Pocket, a camera brand unrelated to drones, and Osmo Action, a motion camera, in 2019. It meant that Dji began to dominate GoPro’s market.

After the success of their first collaboration, Hasu and DJI realized how important they were to each other, unlike their previous collaboration with GoPro. Therefore, DJI invested in Hasu and became a shareholder.

In addition to targeting the consumer market, DJI is a major agricultural drone provider in China. Their agricultural drone products help many farmers in China more easily and quickly complete the work of sowing, pesticide spraying, and even farmland monitoring.

Dji may be the first Chinese company to lead an entire industry. As a result of that dominance, it has been compared to Apple in the press — praise that Wang doesn’t seem too concerned about.

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