MITS Capital Leads New Funding Round for M-Fly to Scale Production Amid Rising Demand

M-Fly - a Ukrainian defense tech manufacturer of combat-tested laser guidance systems and high-precision gyro-stabilized gimbals for UAV platforms - has secured new funding to accelerate growth and meet battlefield needs. The company was backed by existing investors: MITS Capital, which led the round, and Freedom Fund. Norwegian defense-focused VC Gardar and an undisclosed new investor also joined the round.

The exact funding amount and the company's valuation will not be disclosed.

"M-Fly has made incredible progress since graduating from MITS Accelerator, and we are excited to see increased demand from NATO nations for its cutting-edge systems," said Perry Boyle, co-founder and CEO of MITS Capital. "M-Fly is exactly the kind of company MITS Capital targets: a Ukrainian maker of components for the drone supply chain that can continuously improve its offering as battlefield conditions change," he added.

M-Fly was founded in late 2023, growing out of the founders' earlier military-focused volunteer project. By mid 2026, the company had secured $1.4 million through a friends-and-family round, grants from the state-owned defense tech cluster Brave1, and VC funding from MITS Capital, Freedom Fund, Resist.ua, and Ukrainian entrepreneur Borys Shestopalov, co-founder of HD-group.

As of fall 2026, M-Fly's product portfolio includes laser guidance systems and high-precision gyro-stabilized gimbals for air, maritime, and ground unmanned platforms. The company has tested its core technologies on the battlefield in Ukraine, confirming the stabilization platform's performance at speeds of up to 350 km/h.

M-Fly offers a line of cost-efficient laser-guided systems, including RB-150CW and Seeker, to improve unmanned platforms' efficiency.

Another product is the RB-220, a heavy-duty gimbal suitable for large UAVs, manned aviation, helicopters, and naval drones. It can also be used as a ground-based station for air defense applications.

The company also developed the RB-150GD, a dual-sensor gimbal with thermal and daylight video channels designed specifically for medium-class drones. Based on this platform, the company is developing the RB-150 Marine, a weather-resistant gimbal for boats and vessels.

M-Fly plans to release the RB-100, the lightest product in its lineup and designed for small drones, in the first quarter of 2027.

"Over the past 12 months, we have doubled our team and increased revenue severalfold," said Vladyslav Myhovych, founder and CEO of M-Fly. Demand from Ukrainian customers and NATO allies has increased significantly since the beginning of 2026. The main drivers are the growing use of interceptor drones in Ukraine and the resulting need for lower-cost reconnaissance UAVs equipped with high-quality imaging systems.

"What matters even more than performance is that the company has cracked the unit economics, allowing it to price its products significantly below those of its closest competitors," said Denys Gurak, co-founder and COO/CIO of MITS Capital. "That's why we decided to support the next stage of its growth with additional funding."

A gimbal can account for around one-third of the cost of a reconnaissance UAV, while some imported gimbals can cost several times more than the aircraft they are installed on, Myhovych said. "Reliable aerial imaging is critical for the military. Our goal is to keep bringing the overall cost of reconnaissance platforms down by making capable stabilized imaging systems more affordable," he said.

A central part of M-Fly's strategy is deep vertical integration, giving the company control over its products, supply chain, and trade-offs among size, weight, power consumption, and price. All core product elements - from motors and camera lenses to cameras and software - are custom-developed in-house. This approach has allowed the company to price its systems almost on par with Chinese offerings while keeping the share of Chinese components below 6%.

In 2026, M-Fly also migrated its processing architecture from random-access memory (RAM) to a graphics processing unit (GPU)-based platform. The shift makes its systems less dependent on specific computing components and lets engineers adapt more quickly when particular chips or memory components become unavailable.

"Amid the global crisis called RAMageddon, we became almost hardware-agnostic, which protects our supply chain and unlocks scaling," said Myhovych. He expects the drone camera market to exceed more than $100 billion over the next 5-7 years. "New funding will allow us to scale our production facilities and pace of product adaptation to hold a visible share of this market," said Myhovych.