As told to Kasey Wehrum

Industry: Defense

2006 Inc. 500 Ranking: 34

Three-Year Growth: 1,506%

American troops on the ground in Iraq may not know it, but they have a guardian angel looking down on them. It's called the ScanEagle, and it's an unmanned robotic surveillance plane created by the Insitu Group, in Bingen, Washington. Thanks to the Pentagon's fondness for unmanned vehicles--and a partnership with Boeing--revenue at the 125-employee company has soared to $29.5 million, and with a number of new private-industry applications on tap, CEO Steven Sliwa sees plenty of blue skies ahead.

The ScanEagle is small--only 40 pounds with a 10-foot wingspan--so it's one of the stealthiest platforms out there. Since we use a smaller engine, we're a lot quieter, and that means we can get even closer to the threat without the enemy hearing us. ScanEagle is one of the smallest unmanned vehicles that can persistently "stare" at something.

Imagine having a flying video camera that you could put wherever you want. If there is a door that you know the bad guys use, you can just point and click on a map on your computer screen at the ground-control station, and the camera will let you watch that door for 12 hours straight and no one will know it.

Our first test flight in Iraq was scheduled for August 1, 2004. We were pretty scared. In the desert, you've got this incredible heat and blowing sand that gets into everything. Trying to seal up your engines and electronics so that they don't take in sand but at the same time stay cool, that's almost a contradiction. But it worked really well. After two weeks of doing experiments, the Marines came in and said, "Enough of these science projects. We want to make you guys the main deal here." Within a month, we were flying surveillance missions every day.

Insitu founder Tad McGeer and I were classmates studying aerospace engineering at Princeton. I went on to work for NASA; after two years, they sent me to Stanford to get my Ph.D. When I got there, sure enough, Tad was there. I ultimately went back to get my M.B.A., while Tad focused more on technology. But he always kept me informed about his business. Insitu had developed some technology and when the time came to raise funds and do a product rollout, Tad asked me to join the company.

I was employee number four when I joined as president in 2001. Raising funds was tough. It was right after the dot-com fallout, so venture capital money was tight. It probably took 60 meetings with Boeing before we signed a strategic alliance. Boeing helped sponsor us in the early stages when we were getting our R&D off the ground. Now ScanEagle is part of Boeing's portfolio of about a half-dozen unmanned vehicles that it offers military clients. We like to think that ScanEagle is its sexiest offering.

We are a miniature Boeing, in a sense. We do the development, production, and services related to robotic aircraft and unmanned aerial vehicles. Our main advantage is that we are long endurance and low cost. Our vehicles are able to stay up for 15 to 20 hours and only cost $100,000. Other planes that can stay up that long typically cost over $1 million.

The types of missions ScanEagle supports happen to fit in quite well with the type of warfare that is going on right now. Advanced fighter aircraft are terrific airplanes, but they are not going to be all that helpful against insurgents and guerrillas. The Marines used our technology to prepare their plans for the Battle of Fallujah. Senior leadership told us that casualty rates would have been about 30 percent higher if they didn't have our product. That was an amazing feeling.