Ohio's license plates boast that the mid-western state is the "birthplace of aviation pioneers," including the Wright Brothers and John Glenn.
It could also soon be the new home of two would-be aviation pioneers: Carl and Anna Dietrich, who are trying to bring to market the first successful flying car (or, if you prefer, roadable aircraft), the Terrafugia Transition
. The Dietrichs, both MIT alums, currently run Terrafugia out of some warehouse space in Woburn. The slick-looking Transition vehicle, which can either be flown or driven at highway speeds, made its first flight last March. (I initially wrote about Terrafugia in the Globe in 2008
, and again here late last year
Carl Dietrich called yesterday to tell me that he was "very close" to signing a term sheet with a group of private investors in Ohio that would force Terrafugia to relocate there. Dietrich says the company is hoping to raise $4 million to build its next prototype vehicle, which it hopes to unveil at a major airshow this summer, and then go into production.
Dietrich isn't eager to move the company, fearing that he'd lose some key team members. "I would really like to stay in Massachusetts," he says, adding that he has identified a larger space for the company near its current Woburn facility. But "I need a good reason to stay," Dietrich says — meaning somewhere in the neighborhood of $4 million of equity investment. And while he has talked to state economic development officials, they typically don't dangle incentives to pre-revenue companies with ten employees that don't yet manufacture a product. Venture capitalists haven't seemed interested in putting their money into an aircraft company, even though Dietrich points out that Terrafugia has a $14 million order backlog. "There are more than 70 people in line to purchase the Transition, and each of them has written a deposit check to hold their place," he says.
He envisions starting production as early as 2011, and eventually growing to employ about 200 people.
One of Terrafugia's investors told me today that the company has raised a couple million dollars from individuals, mainly in the Boston area so far. "They've been very scrappy" in how they've used this money, he said, "and they've done a fantastic job at getting their first plane to fly for very short dollars." But if they can scare up several million bucks in one fell swoop, rather than going out to try and raise more every six months, then Terrafugia may have to simply follow the money to Ohio, he added. (The company would likely wind up near Dayton.)
Dietrich observes that DARPA, the Defense Advanced Research Projects Agency, recently said it is interested in developing a flying vehicle
capable of carrying one to four passengers (the Terrafugia carries two). He is hopeful that Terrafugia might eventually be a sub-contractor on that program, bringing in some early revenue.
Like all entrepreneurs, Dietrich is convinced that what he's trying to do is inevitable, obvious, and will solve problems that no one else takes seriously enough. (Among them: pilots who unwisely try to fly through bad weather to get to their destination, or who would rather keep their plane in their garage instead of renting expensive hangar space.)
"I know everybody sees this as a bigger risk than I do," says Dietrich. "To me, this is a pretty straight-forward thing."