Turning a Hobby Into a Business: Key Considerations for sUAS

Getting Started

If you decide to pursue a business within this industry, the first step is to participate in an aeronautical training program to prepare for your Remote Pilot Certificate. The FAA requires all commercial drone operators to have this credential, as well as formal drone registration. Once you’ve completed these requirements, you are on your way to starting your own sUAS business. However, there are still many essential steps to complete to ensure a successful startup.

Legally Yours

Every new business must make important legal decisions early on. These decisions are vital to the success of the business and should not be taken lightly.

“The first consideration is whether to organize into an LLC or a corporation,” explained Dr. Sarah Nilsson, an attorney in Arizona and assistant professor of unmanned aircraft systems at Embry-Riddle Aeronautical University. “Either organization is formed in an effort to separate the business from your own personal finances to shield you from personal liability if the business is sued.”

In a limited liability company (LLC), one person can manage the organization and taxes are straightforward. A corporation requires a board of directors and officers, annual filings and fees, minute book and more. Whichever decision you make, it is essential to establish one of these entities to protect yourself.

In addition to company organization, there are legal considerations specific to sUAS.

“As a sUAS business, you must be familiar with the insurance requirements, regulations, state laws and local ordinances in order to operate,” said Nilsson. “You should also be aware of privacy and cybersecurity laws regarding the images and data gathered during operation.”

Operations Essentials

On the operations side, there are a variety of important considerations for drone business owners. New companies must establish details such as services for hire, customer base and initial capital investment. Additionally, sUAS entrepreneurs must determine which aircraft, sensors and software best meet the company’s needs.

“Preparation is the basis for a good business plan,” explained David Thirtyacre, an assistant professor and chair of the sUAS Flight Department at Embry-Riddle. “sUAS is a fast moving industry in regulations, laws, technology and application. Investing in the correct combinations of aircraft, sensors, and software at the right time is critical.”

Making deliberate and insightful decisions will put new companies on a track for success. Business owners who do not plan appropriately put their business at risk in a number of ways.  

“Along with a failed business, sUAS can be dangerous and open a pilot up to legal, liability and enforcement actions if they don't have a good foundation,” said Thirtyacre.