From the Drawing Board

October 13, 2013 11:30 pm

Law change gives lift to folding aircraft project

Founder and CEO Kirk Hawkins in front of a show model ICON A5 aircraft at ICON's offices and show room in Los Angeles.©Ann Johansson

Former US airforce pilot and Stanford graduate, Kirk Hawkins, stands in front of a prototype of his Icon A5 aircraft

Though former US Air Force pilot Kirk Hawkins signed up for business school so that he could hang up his jumpsuit, his departure from the world of aviation was shortlived.

As he enrolled on the Sloan masters programme at Stanford Graduate School of Businessredesigned this year as the Stanford MSx – his imagination was captured by the idea of building a sports aeroplane.

“I steered my curriculum towards anything entrepreneurial ... [and] I would use my classes in the context of analysing my business idea,” says Mr Hawkins.

After graduating from the California school in 2005, he founded Icon Aircraft, the company where he is now chief executive.

The issue

Aerial adventure has a romantic appeal, he says, but government regulations on private flight had historically grounded ambitions.

However, in 2004 a change in US law creating a light sport category of aircraft opened the door for a breed of easy-to-fly recreational aeroplane.

“This change in regulations presented a classic textbook start-up opportunity,” says Mr Hawkins.

The solution

The portable Icon A5 has been in development since 2006. Its wings fold so it can be transported by road.

The single-engine aircraft – which is designed to fly at up to 120 miles per hour with a range of 300 miles – will be able to land and take off on water, as well as on land.

Mr Hawkins compares the A5 to a sports car, designed to capture buyers’ imagination. Its cockpit has a comparable simplicity and style. “I want people to look at [the A5] and think: ‘This is bad-ass. I want to go have fun exploring in it’.”

How the company was developed

It became increasingly clear to Mr Hawkins during his degree that his business idea was viable. A marketing project illustrated the scale of the untapped market for the product.

After finishing his studies, he concluded that he would regret not taking a risk on a start-up. “Disruption to technology causes great opportunities and they don’t happen very often,” he says. “My time at Stanford gave me the confidence to be ambitious [and] to walk into any boardroom.”

Mr Hawkins teamed up with Steen Strand, a friend from his earlier Stanford masters degree in engineering. “I knew enough about planes [and] Steen was an expert in sophisticated consumer design,” he says.

Raising launch capital proved an early challenge. However, investment from Silicon Valley entrepreneurs got the project off the ground. “The entire capital market here is built around monetising disruptive changes through investment in technology,” says Mr Hawkins.

To solve the technical challenges of producing an amphibious aircraft, a team of engineers was assembled. In 2007 Icon recruited aeronautical engineers from Scaled Composites, the company that designed Virgin Galactic’s SpaceShipTwo craft. “With this nucleus of rock-star talent, we could get down to building a compelling product,” says Mr Hawkins.

What next?

The focus is now on starting production in southern California. The company raised $60m in its fourth round of equity fundraising this June.

Mr Hawkins says the goal is to deliver Icon’s first aircraft in 2014. “You have to start slowly ... check the quality and stage the rate of production.” He adds that final production levels will be a function of market demand, but is strongly encouraged by interest so far. The A5 has a list price of $189,000, but more than 1,000 orders have already been placed.

Copyright The Financial Times Limited 2014. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.

SHARE THIS QUOTE