South Korea’s defense industry, currently holding roughly $69 billion in contracts, is poised for disruption. While major players like Hyundai, Samsung, and LG dominate hardware manufacturing, a gap exists in early-stage innovation, particularly in AI-powered robotics. Bone AI, a newly launched startup with operations in Seoul and Palo Alto, aims to fill that void, securing $12 million in seed funding to challenge established defense giants across Asia.
The Rise of Physical AI and the Need for Integration
Bone AI isn’t merely building drones; it’s constructing a fully unified AI platform integrating software, hardware, and manufacturing. The company develops autonomous air (UAVs), ground (UGVs), and marine (USVs) vehicles for defense and government clients, initially focusing on aerial drones for logistics, wildfire detection, and anti-drone defense.
The key to Bone AI’s strategy lies in its holistic approach. Unlike many AI startups siloed in software, Bone AI recognizes the critical need to bridge the gap between intelligence and physical execution. Founder DK Lee, previously co-founder of MarqVision, observed that AI and hardware advancements have occurred in isolation, lacking the industrial backbone needed for scalable deployment.
Strategic Acquisition and Rapid Revenue Generation
Within less than a year, Bone AI has already secured a seven-figure B2G contract and generated $3 million in revenue. This rapid commercial traction isn’t accidental. The company strategically acquired South Korean drone manufacturer D-Makers, absorbing its intellectual property to accelerate development.
This “buy versus build” approach, highlighted by Third Prime general partner Michael Kim, allows Bone AI to bypass lengthy R&D cycles and capitalize on existing assets. The company intends to continue acquiring niche hardware players to further consolidate its position.
The Korean Advantage and Global Ambitions
South Korea possesses a unique advantage: a mature hardware manufacturing ecosystem capable of supporting advanced robotics. Companies like Hyundai, Samsung, and LG have proven the nation’s ability to produce high-quality, cost-competitive hardware at scale. Bone AI aims to leverage this existing infrastructure to build a sovereign AI supply chain within Korea and expand into the U.S., Europe, and allied countries.
A Growing Market and the Need for Disruption
The defense robotics market is ripe for disruption. While Anduril (U.S.) and Helsing (Europe) have achieved multi-billion-dollar valuations, Asia lacks a comparable player. Bone AI seeks to fill this void, capitalizing on the global reindustrialization trend and the increasing demand for sovereign AI capabilities.
Funding and Leadership Commitment
The $12 million seed round was led by Third Prime, with participation from Kolon Group, a strategic investor specializing in advanced materials and manufacturing. Founder DK Lee personally committed over 10% of the round ($1.5 million), demonstrating his full financial and emotional commitment to the mission.
The Path Forward
Bone AI’s success hinges on its ability to integrate AI, hardware, and manufacturing at scale. The company’s strategic acquisitions, rapid revenue generation, and commitment to sovereign AI position it as a formidable challenger to established defense giants across Asia. The future of defense robotics may well be built on the foundations laid by this ambitious startup
