Bone AI raises $12 million to challenge Asia’s defense giants with AI-powered robots

South Korea’s major defense companies have accumulated a nearly $69 billion order backlog through late 2024. According to media reports. Seoul also Accelerating investment in advanced weapons systems and expanding its defense relations, especially with Europe. with New security and defense partnership between the European Union and South Korea in 2024 As exports of vehicles and artillery increased, the country became The second largest arms supplier To European NATO members.

But despite this massive industry footprint, very few startups have emerged to match or challenge incumbents. The country’s defense technology startup scene is still nascent, revealing a wide gap between Korea’s manufacturing strength and early-stage innovation.

Good AIa new startup based in Seoul and Palo Alto, California, launched earlier this year with an ambitious plan to build a completely unified AI platform that connects software, hardware, and manufacturing.

The company develops next-generation autonomous air vehicles (UAVs), ground vehicles (UGVs) and undersea vehicles (USVs) for defense and government customers, with a significant focus on B2G contracts. While it aims to eventually operate all three types of systems, Bone is starting with its defense-focused drones, which are designed to streamline tasks such as logistics support, wildfire detection, and anti-drone defense.

The company, founded by DK Lee (who also co-founded… markvision), raised a $12 seed funding round led by Third Prime with participation from Kolon Group, a South Korean strategic investor with expertise in advanced materials development and manufacturing. Kolon is an ideal strategic partner for Bone, which works across artificial intelligence, robotics and next-generation manufacturing, Lee said in an exclusive interview with TechCrunch.

Lee noted that the startup is already generating revenue, landing a seven-figure B2B contract and bringing in $3 million in its first year of operation. Additionally, Bone has been selected as a winner in a comprehensive logistics program supported by the South Korean government that will deploy autonomous drones and non-land vehicles.

When asked how a company less than a year old managed to secure contracts and generate revenue, Lee told TechCrunch that Bone acquired a South Korean drone company called Md makersand its intellectual property (IP) just six months after launch. Originally focused on AI models for robotics, Bone is now merging its existing AI division with the newly acquired company, and there are more acquisitions on the horizon, he added.

Lee personally pledged more than 10% of the round, about $1.5 million, he told TechCrunch. “This was important to me because I wanted to show investors and my team that I was fully invested, financially and emotionally, in this mission,” he said.

Bone is my second project. His experience co-founding MarqVision gave him first-hand insight into building and scaling AI products around the world, but it also convinced him that the next frontier for AI isn’t just digital; It’s my body.

“After I left MarqVision, I basically started from scratch – going to robotics conferences like… Eee Ikracold emailing the engineers behind Google RT-1/RT-2“And even going up to Jim Keller, CEO of Tenstorrent, at a coffee shop just to introduce myself and have coffee later,” Lee said.

The founder continued: Bone AI should not be classified as just a defensive technology company. With broader ambitions, Li categorizes it as a “physical AI” company, bringing together advanced AI simulation, autonomy algorithms, embedded engineering, hardware design, and large-scale manufacturing under one roof.

While setting up his second company, Lee noticed that AI and hardware were advancing separately.

“No one was building the connective tissue, the industrial backbone that allows intelligent machines to exist at scale,” he told TechCrunch. “Even Nvidia, the most valuable AI company today, relies on a vast ecosystem of manufacturing and manufacturing partners across Asia and Europe.”

Lee points to South Korea’s track record of building strong global appliance manufacturers such as Hyundai, Samsung and LG. “This is why we should see more drone and small robot companies emerging here, and why Korea has the full capacity to support them,” the CEO said. “Our mission at Bone is to build the supply chain for physical AI within South Korea, and then expand that capability to include the United States, Europe, and other allied countries.”

Anduril has become a household name in the US, where it is valued north of $30 billion, while in Europe, Helsing last raised funding at around $13 billion. Even in smaller markets like Israel, companies like Kela Technologies have achieved similar recognition.

Asia has yet to see the same level of adoption, Michael Kim, general partner at Third Prime, told TechCrunch. “While economies around the world are focusing on remanufacturing, not just the United States, Bonn sits at the intersection of sovereign AI, multipolarity, and remanufacturing,” he said, highlighting the company’s mission and the problem it aims to solve.

South Korea enjoys manufacturing high-quality, cost-competitive devices across multiple sectors such as heavy industry, shipbuilding, automotive, and semiconductors.

“There are many players who specialize in hardware but have not received Bay Area VC funding; Bone has an aggressive ‘buy versus build’ strategy to acquire and integrate these assets, accelerating product maturity and commercial traction,” Kim said.