DataCloud, a developer of sensors and software to help guide mine operators’ decision-making around drilling and blasting, has raised $4 million in new financing to support the Seattle-based startup’s continued growth.
The company’s system combines cloud-based software with connected sensors that are attached to drills and collect data as blast holes are drilled into a surface.
DataCloud’s software analyzes information gathered by the sensors, which can measure and detect things like density, faults, and fractures. Once this analysis is complete, users get back what Thor Kallestad, the startup’s co-founder and CEO, calls “real-time orebody imaging and knowledge.”
DataCloud’s customers include companies that mine iron, copper, cobalt, and other valuable metals, Kallestad says. One approach to this work involves blasting a long, narrow strip of rock—sometimes known as a rock bench—to extract valuable metals and minerals from it. With this approach, the goal is to blast ore—the fragments containing the desired metals—into small pieces to make it easier to extract metal from them. There’s no need to do so with so-called waste rock, which does not contain minerals in high enough concentrations to merit extracting them; miners blast that into large fragments.
The digital tools DataCloud sells are designed to help miners better estimate the amount and ideal placement of explosive material needed to separate ore from waste rock. A more effective blast can lower the cost of processing the fragments, Kallestad says.
DataCloud’s software can, for example, help users create and analyze maps and high-resolution images of rock formations. This information can help blast engineers and other users refine their blast plans for a given area, Kallestad says.
Launched in 2016, DataCloud now has about 30 employees, he says. They work from offices in Seattle; Palo Alto, CA; and Pilbara, a region in Western Australia that Kallestad describes as a hub for the iron ore business. In addition to its customers in Australia, DataCloud also works with mining companies in Quebec and other parts of Canada. The company plans to open a third satellite office, in Vancouver, British Columbia.
The latest investment follows a $8 million funding round DataCloud raised earlier this year. The startup has now raised about $13.3 million in outside financing, Kallestad says. DataCloud’s backers include Aperture Group and Orica Mining Services, he says.
DataCloud may seek to raise another funding round, likely of $30 million or more, as soon as next year, Kallestad says. By then, he anticipates the startup will have $10 million to $15 million in booked annual revenue, he says.
The startup uses a software-as-a-service model: Customers make recurring monthly or annual payments to use its digital platform. Access to DataCloud’s sensors that attach to drills comes with the subscription fee, not as a separate charge, he says.
DataCloud has been able to grow—and attract interest from investors—relatively quickly in the two years it’s been operating. Kallestad says he’s not aware of any head-on competitors, but acknowledges that other companies offering similar products and services may pop up in the future.
Kallestad says his startup has benefited from decreases in the cost of connected sensors designed to work with machinery—part of the so-called Internet of Things, or IoT. It’s also cheaper than ever to host data remotely with cloud computing vendors like Amazon (NASDAQ: [[ticker:AMZN]]) Web Services and Microsoft Azure (NASDAQ: [[ticker:MSFT]]), on which DataCloud runs its service.
Those are “right place, right time parts to our story,” Kallestad says.
