Closing Bell - Manifest Space: Autonomous Shipbuilding Hits $4 Billion Valuation with Saronic CEO Dino Mavrookas 2/20/25

Episode Date: February 20, 2025

Autonomous shipbuilder Saronic is raising $600 million in a Series C funding round that—within a year— quadruples its valuation to $4 billion. CEO Dino Mavrookas joins Morgan Brennan to discuss the challenges and delays in miliary shipbuilding, the company’s $600 million Series C funding round, and making vessels that don’t require humans.

Earlier this month, I broke the news that Andral Industries is raising more money at double its previous valuation. But it isn't the only defense tech startup garnering surging investor interest. Autonomous shipbuilder Saronic is raising $600 million in a Series C that quadruples its valuation in less than a year to $4 billion. Saronic already makes three types of unmanned surface vessels and has worked with the U.S. Navy since it was founded. The new capital will mean it can make larger ships and build a futuristic shipyard called Port Alpha. CEO and co-founder Dino Mavrukis says the plan is to bring shipbuilding back in a way the U.S. hasn't seen since World War II.

Everything we do at Ceronic is built around speed. I mentioned we brought three products to market in under two years. since World War II. Everything we do at Ceronic is built around speed. I mentioned we brought three products to market in under two years. We've raised $850 million in just about two years. That's more private capital than any company has raised that's focused on maritime innovation in the last 50 plus years. Everything we do is centered on speed because we understand the urgency of the problem set. When we look at what has equated to naval power in the past,

it's really shipbuilding. The Chinese have invested so heavily in their shipbuilding capacity over the last 30 years that they can outbuild the US in terms of shipbuilding capacity nearly 250 to 1. That's a very scary stat. That is a very scary stat. They went from 5% of global shipbuilding capacity to nearly 50% over the last 25 years.

We don't have time to wait. We're doing this now. Military shipbuilding is hard. It's faced many challenges and delays. Just ask Defense Prime Contractors HII and General Dynamics, doing this now. Morgan Brennan, Man this is Manifest Space. We're excited to announce that we're raising a Series C. We're raising $600 million on a $4 billion valuation to really accelerate our mission to go out and redefine maritime superiority for the U.S. and our allies around the world. So I do want to ask you where that money is going to go to work. But first, $4 billion valuation. You raised last summer in July at a $1 billion valuation. That's a huge jump. What does it say about the company? We've been able to execute at a speed and a scale that hasn't been seen before in the maritime environment. We've raised close to $850 million now in just over two years. We set out

on this mission to redefine maritime superiority, right? We're doing that through autonomy. So we brought three different products to market in under two years, six foot, 14 foot, and 24 foot autonomous surface vessels or autonomous boats that are designed for naval missions and naval use cases. But not only that, we're building the most advanced software in the world to control swarms of these platforms to make sure that the Navy has the capability that's needed to drive the future of autonomous warfare. Are you already selling these unmanned ships to the Navy and to the U.S. military? Yes, we've partnered. So we've partnered with the Navy since the day we started the company.

That's how we stay so mission focused. The customer has moved just as fast as we did. They've accepted risk. They've driven the adoption of unmanned platforms into the military, and we've moved quickly to support that effort. So in terms of contracts, do you have programs a record then, or how to think about what that portfolio looks like and how it continues to grow? So without getting into the specifics of our contracts, I wish we lived in a world where I can lay out all of our contracts and tell you where and how we're selling to the Navy. But we have multiple contracts with the Navy.

Again, we've had contracts since the day we started the company. We've really focused on this partnership effort, understanding the mission, understanding the con ops, and solving the problems that the Navy has in advancing naval power around the world. So this new funding round, what does it enable you to do? So what we are going to do, I mentioned the three products that we have today, so we're really excited to scale the production and manufacturing of those, but we're also launching another initiative into larger autonomous ships. When you look at what the Navy envisions as its future hybrid fleet, it is the manned platforms that we have today combined with unmanned ships. And we are building that future autonomous fleet.

So we're moving into large autonomous ships. And we are going to build what we're calling Port Alpha. It is our initiative to build the shipyard of the future, to invest billions of dollars into the defense industrial race, create thousands and thousands of jobs in the process, and bring shipbuilding back to this country in a way that we haven't seen since World War II. And to do that, to build, again, the autonomous ships that is the future of our naval fleet. So Port Alpha would be your military shipyard? That is correct, yes. How quickly can you stand it up? We are standing it up, well I'll say this, we're standing it up

extremely quickly. Everything we do at Ceronic is built around speed. I mentioned we brought three products to market in under two years. We've raised $850 million in just about two years. That's more private capital than any company has raised that's focused on maritime innovation in the last 50-plus years. Everything we do is centered on speed because we understand the urgency of the problem set. When we look at what has equated to naval power in the past, it's really shipbuilding.

The Chinese have invested so heavily in their shipbuilding capacity over the last 30 years that they can outbuild the U.S. in terms of shipbuilding capacity nearly 250 to 1. That's a very scary stat. That is a very scary stat. They went from 5% of global shipbuilding capacity to nearly 50% over the last 25 years. We don't have time to wait.

We're doing this now. This is not a theory. This is not a concept. We're building large autonomous ships for the Navy and we're building this, the Port Alpha, which will be the most advanced shipyard anywhere in the world. We're rethinking how we build ships in this country so that we can bring a very critical capability back to our defense industrial base that's absolutely critical for our national security. So how big are these autonomous ships, this next

tranche of ships that you're designing and developing? How quickly can you build them? And I ask that knowing that shipbuilding is hard and is costly. And in this country, when you look at the other military shipbuilders out there, HII or General Dynamics, very, very delayed in terms of the ships they're able to crank out. That's exactly right. Shipbuilding is hard. And when you talk about the legacy platform, our Navy has a 290 ship fleet today. There's a congressional mandate for 355 ships in the U.S. Navy. That's been out for the last 10 years. So we can't get to where we need to be just based on traditional shipbuilding alone. Now, I want to be very clear. What we're building is fundamentally different. These are not manned platforms.

These are fully autonomous ships that are designed to be built very economically and in very, very large quantities extremely quickly. And that's what we're going to be doing at Port Alpha. What does that mix, and I realize maybe this is a question for the Pentagon or for the Navy, but what does that mix need to look like, especially if you're trying to get to 355 ships and trying to counter you know other superpowers like china on the world stage who are building much more quickly than we are well there's been very clear guidance from the navy on what they envision their hybrid fleet to look like right they want 40 of the fleet to be fully autonomous ships and so now if you

make the assumption that we get to 355 manned vessels in our fleet you're almost matching that on a one-to-one basis for autonomous ships right but then on top of that they want thousands and thousands of smaller tritable systems to surround that man and unm unmanned fleet. So it really does create a hybrid manned and unmanned teaming environment that can scale well into the thousands on all shapes and sizes, but again, specific to the mission. What are the missions that we want to accomplish to project naval power around the world? And let's design our platforms around that and incorporate

the most advanced software autonomy and artificial intelligence anywhere in the world. Do you already have ships that are deployed and out running missions? Again without getting into specifics because we can't say where our products are in use but again we have multiple contracts with the United States Navy. Our platforms that we have today are currently in use by the Navy, and we're excited to support their mission globally. So what can autonomous ships do that manned ships can't? And I guess is there a point at which maybe longer term down the road

you would think about getting into manned systems as well? So what autonomy provides is the ability to extend the range capability and survivability of large manned ships. And what that means is, and like I know we've talked about this, but I spent 11 years in the Navy, right? I was in the Navy SEAL teams. My last five years were on SEAL Team 6. For me, this is very personal, right? How do you keep ships that not only cost billions and billions of dollars and take years to make? I mean, an aircraft carrier, for example, takes 10 years to construct and costs $10 billion. But there's hundreds and thousands of people,

or hundreds or thousands of people on these ships. How do you keep them safe while still projecting power in engagement zones? That's what autonomy provides. So what do you expect? We seem to be at this moment where technologists are descending upon Washington, including many folks that have been in the defense tech industry in some form or fashion for a while.

What do you expect policy to look like now over the next four years and beyond when we do start to talk about autonomy and we do start to talk about military readiness and doing more with less as perhaps defense dollars are going to decline? Well, I'll tell you, we're really excited from what we're seeing out of the new administration. You know, there's already been this movement into autonomy. And the fact that we can't rely solely on the legacy systems that our military is currently built on, they're too exquisite, they're too expensive, and they take way too long to build. So that movement's happening.

What we're seeing and what we're excited about out of the new administration is, one, the opportunity to really accelerate that, to move very, very quickly. And again, that's what we're doing at Ceronic. We're moving as fast as humanly possible. But the second thing is to really do big, bold, and visionary things to change the future of our defense industrial base. This isn't about how do you go and build one new product. This is about how you bring shipbuilding back to this country in a way that we haven't seen since World War II. How do we make sure we have the most powerful Navy in the world for the next hundred years? That's what we're building at Ceronic, and that's what we're excited to partner with the new administration on.

And I'm going to wrap this conversation up here in just a minute but just to dig into that a little bit more deeply, workforce has been an issue when you talk about shipbuilding and also how fragile that defense industrial base particularly in shipbuilding has been. It's one of the things that's in focus with, for example, steel and aluminum tariffs, is this idea of standing up a stronger, more resilient, homegrown, you know, metal making industry here in the U.S. So how do you do it? And how do you do it when others seem to be, at least so far, perhaps failing or falling short? First and foremost, I want to just reiterate the fact that we're building something fundamentally different here. We are not focused on building large man warships.

And the second way you do it is by reinvigorating the culture around shipbuilding, right? You invest billions of dollars into building the future of our Navy. You create a mission and a purpose. You create a recruiting and training pipeline that recreates this workforce that we do need in this country, right? And you give those people an environment to be very, very successful. Look, it's the same way SpaceX brought an entire industry that did not exist in this country before they started back to America. That's what Ceronic is doing for the maritime and shipbuilding. We're bringing shipbuilding back to this country.

We're creating a culture within shipbuilding that doesn't exist today. And we're going to invest billions of dollars into our defense industrial base to make sure that we have the capacity that we need going forward. All right. Dino Mavrukas of Sronic. Thank you so much for joining me. Thank you for having me. That does it for this episode of Manifest Space. Make sure you never miss a launch by following us wherever you get your podcasts and by watching our coverage on Closing Bell Overtime. I'm Morgan Brennan.