Drone Industry Faces Same Private Equity Trap Now Squeezing Volunteer Fire Departments

We have been reporting on how private equity and venture capital are reshaping the drone industry for years. Today, The New York Times published an investigation that exposes the identical playbook being used against volunteer fire departments, and the parallels are impossible to ignore.

The pattern is now undeniable: Wall Street investors are systematically targeting taxpayer-funded emergency services, creating monopolies, eliminating affordable alternatives, and jacking up prices on the agencies that protect American lives. First it was software. Now it is drones.

The Software Monopoly: How Private Equity Captured Fire Departments

According to The New York Times investigation, ESO Solutions, backed by Vista Equity Partners, now controls approximately 20,000 of America’s 30,000 fire departments through aggressive acquisitions of software platforms those departments depend on.

Vista Equity Partners manages over $100 billion in assets. The firm is led by Robert F. Smith, a billionaire who agreed to a $139 million settlement with the federal government in one of the largest tax evasion cases in American history.

The playbook is straightforward: acquire competing software platforms, shut down the affordable ones, and force captive customers onto expensive alternatives. The Norfolk Volunteer Fire Department in Connecticut watched its annual software costs jump from $795 to over $5,000, a 530% increase, after ESO acquired the platform it relied on.

The Mesilla Fire Department in New Mexico saw costs triple from $4,000 to $12,000 annually. Chief Greg Whited compared ESO’s treatment of his department to an abusive relationship: “I’m not going to come back with sunglasses on, covering a black eye. You’ve taken advantage of my department.”

Volunteer fire departments represent 85% of America’s roughly 30,000 fire departments. These are not well-funded urban agencies. They operate on shoestring budgets, fund operations through karaoke nights and silent auctions, and depend on unpaid crews who risk their lives to protect their neighbors.

Private equity sees these departments not as community lifelines but as captive revenue streams. Tax dollars flow in, and Wall Street extracts maximum value.

The Drone Industry: Same Strategy, Different Product

The exact same playbook is unfolding in the drone industry. Venture capital and private equity-backed American drone manufacturers cannot compete with DJI on price, features, or reliability. So instead of building better products, they are spending millions to lobby for legislation that eliminates their competition.

Skydio has raised over $740 million from investors including Andreessen Horowitz, Linse Capital, IVP, Next47, NVIDIA, and the Walton Family Foundation. The company is valued at $2.2 billion. When Skydio couldn’t compete in the consumer drone market, it abandoned consumers entirely in 2023 and pivoted to government contracts where lobbying, not product quality, determines winners.

Skydio’s lobbying expenditures tell the story. According to OpenSecrets.org records, the company spent $10,000 on federal lobbying in 2019. By 2023, that figure exploded to $560,000. Skydio paid a team of lobbyists, including those at Brownstein Hyatt Farber Schreck, $200,000 for lobbying efforts. A Collier County official was later fired after it was revealed he secretly worked for the firm while employed by the county.

BRINC Drones has raised $157 million from Index Ventures, OpenAI CEO Sam Altman, Peter Thiel, and Motorola Solutions. China sanctioned BRINC and founder Blake Resnick personally in December 2024 as part of retaliation against U.S. arms sales to Taiwan, listing the company alongside defense giants like Raytheon.

These companies are not competing on merit. They are using investor money to purchase legislative outcomes that create captive government markets, exactly as ESO did with fire department software.

The Price Explosion: 3x to 14x More Expensive

When volunteer fire departments are forced to switch from affordable platforms to private equity-controlled alternatives, prices explode. The same happens when public safety agencies are forced from DJI to Blue sUAS drones.

A leaked Department of Interior memo revealed that Blue sUAS drones approved by the Pentagon are 8 to 14 times more expensive than comparable DJI platforms. The memo warned that forcing agencies to use only approved systems “reduced the sensor capacity of the Department of the Interior by 95%” and made it “almost impossible to carry out statutory management tasks.”

Florida: The $200 Million Warning

Florida already ran this experiment, and it was a disaster. In April 2023, Governor Ron DeSantis signed legislation effectively banning Chinese-made drones for state agencies. The results speak for themselves.

The state grounded an estimated $200 million worth of functional public safety drones. The legislature provided just $25 million for replacements, creating a $175 million funding gap. Many departments simply lost their aerial capabilities entirely.

Orlando Police testified that DJI had zero failures in five years while approved Blue sUAS replacements failed five times in 18 months. Approved drones caught fire in patrol vehicles, fell from the sky during operations, and cannot fly at night, eliminating critical search and rescue capabilities.

Palm Beach County’s drone operations collapsed from over 100 missions monthly to five. Collier County lost its 92-second aerial first responder program. Broward Sheriff’s Office grounded 63 DJI drones worth $300,000 and managed to replace them with just three approved alternatives.

Senator Jason Pizzo captured the corruption during a Florida Senate hearing when he accused a state official of “pimping for Skydio“ after the official held up promotional material from the drone manufacturer during his testimony.

A Collier County official was terminated after secretly working as a lobbyist for Skydio while employed by the county. The approved manufacturers list published by Florida included exactly the same companies that lobbied for Chinese competitors’ exclusion.

December 23: Nine Days Until Default Ban

The same disaster now threatens to go nationwide. Section 1709 of the 2025 National Defense Authorization Act set December 23, 2025 as the deadline for a federal security agency to complete a security review of DJI. If no agency finishes the review, DJI is automatically added to the FCC’s Covered List, blocking new drone imports.

The catch: Congress never assigned which agency should conduct the audit. DJI sent letters to five federal agencies in March 2025 requesting the review. No agency responded. Nearly a year has passed since the NDAA established this one-year review window, and no federal agency has formally begun the security assessment.

An Arizona fire chief warned 12News: “In my opinion, lives are going to be lost because this air capability is going to be taken away.” His department faces an impossible choice: pay three times more for inferior equipment or lose critical aerial capabilities entirely.

DJI is not asking to be exempted from security review. The company has repeatedly stated it welcomes scrutiny. “We are confident not only because we have nothing to hide, but because independent firms and other U.S. government agencies have repeatedly validated and confirmed that DJI’s products are secure,” wrote Adam Welsh, head of global policy for DJI.

The company is asking for a fair process, not a bureaucratic trap where no audit means automatic ban.

DroneXL’s Take

The New York Times investigation confirms what we have been documenting for years: private equity and venture capital are systematically targeting essential public services, creating monopolies, and extracting maximum value from taxpayer-funded operations.

The pattern is identical. In software, Vista Equity Partners acquired multiple fire department platforms, shut down affordable options, and forced captive customers onto expensive alternatives. In drones, Skydio and BRINC raised hundreds of millions from investors, failed to compete on product merit, and pivoted to aggressive lobbying that would eliminate their primary competitor through regulation rather than innovation.

The same volunteer fire departments being squeezed by software monopolies will also be squeezed by drone monopolies. Rural departments operating on annual budgets of $132,000 cannot absorb 530% price increases for software AND 400-600% price increases for drones. Something has to give, and what gives is capability.

This is protectionism dressed as patriotism. Companies that cannot build better products are instead building better lobbying operations. The victims are first responders, search and rescue teams, and the communities they serve.

We have documented Florida’s $200 million drone ban disaster. We have covered Arizona fire chiefs warning that lives will be lost. We have tracked Skydio’s controversial lobbying pivot and the Florida Senate hearing where an official was accused of “pimping for Skydio.”

The December 23 deadline is nine days away. Either a federal agency will complete the mandated security review, Congress will extend the timeline, or DJI will be banned through bureaucratic neglect rather than evidence-based security findings. With only nine days remaining, the only realistic solution is an extension that allows a genuine, fact-based review.

Banning DJI without completing the mandated audit will not enhance national security. It will enrich private equity-backed competitors while degrading public safety capabilities nationwide. It will cost American taxpayers billions of dollars. And if Florida’s experience is any guide, it will cost lives.

What do you think about private equity targeting volunteer fire departments and the parallel in the drone industry? Share your thoughts in the comments below.