Quick Take

A key milestone for Parallel Flight Technologies, $140 million for Heron Power Electronics Company and another step forward for Joby Aviation are among the topics in this week's look at local business from Jessica M. Pasko.

Each week, we’re taking a closer look at the movers and shakers, the growth of industries and what’s really driving the Santa Cruz County economy. I’ll be spotlighting some of the biggest areas for opportunity, updates on local development and all things underpinning the regional business scene each Wednesday.

Got ideas? Send them my way to news@lookoutlocal.com with “Business News” in the subject line.

Parallel Flight Technologies gets federal aviation exemption, paving way for new commercial uses

La Selva Beach drone developer Parallel Flight Technologies has received a new federal exemption that will help clear the path for commercial operations. The company’s Firefly is a special type of drone capable of both heavy lifting and long flight duration. The unmanned, hybrid-powered vehicle is designed to carry loads of up to 100 pounds over long distances and can reach speeds of 60 to 100 mph. It’s designed for uses such as defense operations and firefighting, especially in harsh and remote areas.

Last week, the company announced it had received a new exemption from the Federal Aviation Administration. That means Parallel Flight can move forward with commercial operation of its unmanned aircraft in the U.S.

The company said this represents a major regulatory milestone and will enable it to support new industrial applications, including wildland fire management, delivering critical resources to disaster zones or helping with the installation of sensors in hard-to-reach areas.

Parallel Flight, founded in 2018, is also working with the U.S. military on use cases. Last fall, it was awarded a $3.7 million contract from the Office of Naval Research to modify Firefly for maritime operations. 

Scotts Valley tech company raises $140 million to transform electric grid technology

Heron Power Electronics Company has raised another $140 million to aid its efforts to upgrade legacy energy infrastructure. The company, based in Scotts Valley and founded by a former Tesla executive, is focused on building a new kind of transformer it says is more compact and responsive than older models.

The Series B funding comes from a consortium of investors led by Andreessen Horowitz’s energy-focused venture fund. (Series B is the name given to a company’s first significant round of venture capital funding.) It follows the company’s first significant raise of $38 million in June.

Company officials say the money will be used to build a new highly automated manufacturing facility for Heron Link, the company’s solid-state transformer system for energy and artificial intelligence data center projects. Heron Power hasn’t said where that facility will be located. 

Transformers are a key part of the electric grid, and Heron Power is focused on modernizing these for today’s energy needs. Most older transformers are huge and can’t always adapt quickly to changes such as energy demand fluctuations, weather conditions and other external factors, according to the company. The proliferation of connected devices and new data centers, with more being built, is exacerbating this situation.

Drew Baglino founded Heron Power after leaving Tesla in April 2024. Baglino started at Tesla in 2006 and later served as the company’s senior vice president of powertrain and energy engineering. Tesla’s powertrain system is the engine of its electric vehicles, including the battery, electric motors and charging system.

Joby and Uber debut new rider app in advance of anticipated launch in Dubai this year

an animation of app-based ride hailing of Joby Aviation's electric helicopters in Dubai
Credit: Joby Aviation

Santa Cruz-based electric helicopter company Joby Aviation and Uber introduced their new app last week to show how riders will be able to book rides once commercial service is launched. 

Once rolled out, Uber Air powered by Joby will be an option under the Uber app. Riders will be able to book an electric helicopter the same way they’d book a car. When riders enter a destination in the app, the Joby option will appear if the trip qualifies. Joby’s aircraft are designed to hold up to four passengers and fly at speeds of up to 200 mph. 

Joby officials have said they expect to carry its first passengers later this year in Dubai, where it has inked an agreement with Dubai’s Road and Transport Authority to be the sole air taxi provider there for six years. 

Service in other countries will launch after that, including in the U.S., where operations are scheduled to begin first in Los Angeles and New York City. To operate commercial service in the U.S., Joby must complete a number of rigorous requirements to receive what’s known as Federal Aviation Administration type certification, the same process used to certify traditional aircraft. The company is currently in the final stage of this process.

ICYMI: Watsonville Community Hospital sees slight improvement in January finances

The entrance to the emergency room at Watsonville Community Hospital. Credit: Kevin Painchaud / Lookout Santa Cruz

Watsonville Community Hospital saw a small improvement in its finances in early 2026 after reporting almost $23 million in losses last year.

The hospital’s chief financial officer said last week that the organization saw a much smaller loss in January than in almost every month in 2025. Read more from Tania Ortiz here.

Ch-ch-changes

  • Santa Cruz biotech company inks deal with Novartis: Unnatural Products will partner with Swiss pharmaceutical giant Novartis to develop new therapies to treat cardiovascular disease. Under a new research collaboration and licensing agreement, the Westside-headquartered company is scheduled to receive up to $100 million in upfront payments and as much as $1.7 billion in development, regulatory and commercial milestones. Novartis will take the lead on overseeing clinical development, manufacturing and global commercialization of any resulting drugs. The two companies didn’t disclose additional details. Unnatural Products, founded in 2017, specializes in using what are known as macrocyclic peptides to treat certain types of diseases that have been resistant to other therapies.
  • Visit Santa Cruz County seeking nominees for board of directors: The county’s tourism marketing organization is accepting nominations for its board of directors seats through March 13. The two vacant seats must be filled by representatives from the local lodging industry. Visit Santa Cruz County is governed by a 25-member board that includes representatives from several sectors. Board members serve a two-year term, with the new term starting July 1. For an application or more information, email Visit Santa Cruz County here.
  • New board member for West Coast Community Bank: Alex Potts has been named to the board of directors for Santa Cruz-headquartered West Coast Community Bank. Potts is the co-founder of MCAP Ventures, an investment and consulting firm based in Pleasanton.
  • Soquel tattoo shop shutters: California Electric Tattoo in Soquel closed last month after 15 years in business. A post on the shop’s Instagram account said the decision was entirely voluntary and wasn’t made under duress. The shop’s tattoo artists will be moving to other local tattoo parlors, including Milestone Tattoo and Fog City Tattoo in Santa Cruz.
  • Pajaro Valley nonprofit leader selected for state climate fellowship: Eloy Ortiz, special projects manager for Regeneración Pajaro Valley, is among the 2026-27 cohort of the California Climate Leaders Fellowship with the Center for Community Investment. The fellowship supports leaders across the state who are advancing community-centered climate resilience.
  • New creperie opens in Capitola Mall: V&V Delicious Crepes is now open inside the Capitola Mall food court, next to Ramen Kaito. The shop specializes in vegan and vegetarian crepes, many featuring organic ingredients sourced from local farmers’ markets. 
  • Bay Federal Credit Union announces new leadership in Watsonville and Capitola: Maribel Maldonado was appointed the new branch manager for Santa Cruz-based Bay Federal’s Watsonville location, having previously run the Salinas and Aptos branches. Art Ruvalcaba was promoted to assistant vice president, branch manager for Capitola. He previously held roles with the credit union as financial services officer and lead financial services officer. 
  • Grand opening set for vinyl bar and pizzeria in Aptos: Fawn Pizza & Vinyl Bar will host a grand opening event on Sunday, March 8, from noon to 6 p.m. featuring DJs and pop-up vendors. It’s located at 783 Rio Del Mar Blvd., #45, in Aptos.
  • Evarista’s Comal reopens in Capitola Mall: Mexican restaurant Evarista’s Comal is now located inside the Capitola Mall, next to Coffee Conspiracy. The restaurant closed its East Cliff Drive location, in the old Star Bene, at the end of last year in advance of the move. 
  • Nashville fried chicken chain to open in Watsonville: Angry Chickz, a Los Angeles-based fast food chain, is set to open at 975 Main St. in Watsonville on March 20. It will be the company’s 32nd location in California and 36th in total. The chain, founded in 2018, specializes in chicken tenders, bowls and sliders with customizable heat levels.
  • New pilates studio joins Pacific Avenue: RockSalt Pilates, which has locations in San Mateo and Santa Clara counties, opened its sixth location last month in downtown Santa Cruz. The new studio, located at 1106 Pacific Ave., is also hiring instructors.

Got hires, promotions or departures to report? Send them to news@lookoutlocal.com with the subject line “Career changes.”

What’s new on the Lookout Job Board

Want more? Browse all openings on our job board. | Hiring? Post your job today!

Save the date 

  • Wednesday, March 4: Santa Cruz Works will hold its next New Tech event featuring music by Cruz Control, appetizers, networking and talks by representatives from several new local startups, including Activity Ally. Tickets and registration are here. The event will be held at the Chaminade Resort & Spa, with doors opening at 6 p.m.
  • Thursday, March 12: A grand opening and ribbon-cutting for the new RiverRow apartments at 444 Front St. in Santa Cruz will take place from 11 am to 1 p.m.
  • Friday, March 13: The Capitola-Soquel Chamber of Commerce’s annual awards gala takes place from 5:30 to 9 p.m. at Chaminade Resort and Spa in Santa Cruz. Nominations are currently open for person of the year, business of the year, educator of the year, outstanding youth, and the community spirit awards. For registration details and the nomination form, click here.
  • Wednesday, March 18: The Santa Cruz Chamber of Commerce holds its next “business after hours” event at Dominican Hospital, 1555 Soquel Dr., Santa Cruz, from 5 to 7 p.m. Details and registration here.
  • Wednesday, March 18: The Santa Cruz County Skilled Trades Job Fair takes place from 4 to 6:30 p.m. at the Grove Event Center on Beach Street in Santa Cruz. The free event connects job seekers with local employers and training providers in construction, HVAC, welding, maintenance and more. More details here.
  • Thursday, April 16: The Santa Cruz Area Chamber of Commerce will hold its annual community recognition awards event at The Grove in Santa Cruz from 5:30 to 9 p.m. Early bird registration is available through March 15.

Add your business or networking events to Lookout’s free public calendar, BOLO. Click here to add your event.

Business news worth reading

Have something to say? Lookout welcomes letters to the editor, within our policies, from readers. Guidelines here.

Jessica M. Pasko has been writing professionally for almost two decades. She cut her teeth in journalism as a reporter for the Associated Press in her native Albany, New York, where she covered everything...