I’ve had a number of readers write in and ask about “Sky-Fi” lately, and at first I thought this was just a repeat of the Halo-Fi pitch that Ray Blanco has been sending out pretty much every two months for several years now… but it’s a little different. Here’s the intro to the ad:
“Why Jeff Bezos, NASA, & Sir Richard Branson are all fighting tooth and nail to see this private startup take off. And why it can only be compared to investing in AOL before it hit the stock market in 1994…
“On December 31, This Tiny New Mexico Startup Will KILL OFF Comcast, Verizon, and Charter Cable…
…With One Clean Shot”
And it’s really not the ad that’s different, oddly enough — they pretty much just ripped off the whole Halo-Fi ad, including the spurious promise that somehow this satellite network will soon give you “$7 internet” because we all hate our cable companies, and just swapped out a few of the details to refer to this “Sky-Fi” idea instead of the “Halo-Fi” stock that Blanco was pitching.
That Halo-Fi pitch was all about OneWeb, which is a private company that is trying to build a low earth orbit (LEO) satellite constellation in order to provide internet access to remote areas… but they got around that “private” part by primarily, I conclude, teasing Softbank (SFTBY), which is OneWeb’s largest investor. Thanks to the We Work debacle and some other criticism of Softbank in the past year or so that cut the shares of Masayoshi Son’s Softbank roughly in half, that investment likely hasn’t worked out very well (I haven’t updated my article about Halo-Fi recently, but the ad is still circulating — it now says that this excitement could happen “starting December 19”, and presumably they mean 2019 for this latest version, though the ad is largely unchanged since I first covered it, when that “deadline” was October 1, 2017).
I’ve noticed over the years, though, that it’s not the quality of the idea that makes a newsletter publisher re-send the same promo ad over and over… it’s the appeal of the ad itself, and whether or not the story works to bring in new subscribers. So clearly this idea of “$7 internet from the sky” does still catch the attention of investors.
So what’s this latest company that’s using a repurposed version of “Halo-Fi?” Well, they’re also actually collaborating with Ray Blanco’s Technology Profits Confidential in bundling their service with his using this ad (I’m not sure of Crowdability is technically owned by Agora, which owns Blanco’s publishing company, but most of these publishers are related somehow… and they clearly share copywriters). What’s being sold this time is an online course from Crowdability called The Early Stage Playbook, and, of course, your “free” (with purchase) copy of “Sky-Fi’s Private Launch Party: A Startup Play for up to 52,790% Gains.”
Crowdability is part of the relatively new wave of “angel investor” services that have cropped up in the past few years, embracing our fascination with “venture” and early-stage private investing and trying to leverage the impulses created by hit shows like Shark Tank. They are essentially promising to guide you in finding private investments, and therefore giving us each the daydream that we could be the next Mark Cuban or Peter Thiel and be an early backer of the next big thing.
Some private companies do make money, of course, and sometimes they’re even acquired to give early investors a nice profit fairly quickly… but most of them, of course, are not exactly “cream rises to the top” companies. There is an EXTRAORDINARY amount of cash bursting the doors of all the big venture capital companies, and asset managers are desperate to get in on the most appealing early-stage unicorns, even now that there have been some serious blow-ups in the space (thanks in part to Softbank’s inflationary impulses), which means, if we can turn off the “greed” signals for just a moment, that no, you aren’t going to be sitting at the table with Peter Thiel and get a look at the most compelling startups just because you spent $79 for an online course about angel investing. If you really want to become an angel investor, look for local businesses that you can understand really well and where you trust the people and want to be on the board or work, and help those businesses try to grow… buying into the unregulated private investing world is enticing, and feels exciting, but my guess would be that it also comes with a 90%+ probability that you’re going to lose all your money, with nothing to show for it.
Yes, maybe I’m being too conservative. But given that you can go read the ad yourself and get hyped up by that, I’ll take “too conservative” as my stance just to try to balance that.
Crowdability’s disclaimer, by the way, should be required reading before you get too excited about the stocks they present to you — it reads, in part:
“We do not investigate, represent or endorse the accuracy, legality, legitimacy, validity, or quality of any products, services, companies, investment opportunities, or Materials (collectively, the “opportunity” or “opportunities”), including those contained on, distributed through, or linked, downloaded or accessed from the crowdability site.”
So with that buzzkill in hand, what is it that they’re trying to sell you with this new special “Sky-Fi” report? Here’s what they say about the company, after showing us pictures of the guy behind it posing with Jeff Bezos at a launch site….
“The company I’m recommending today has that in spades.
“It’s going to save people billions of dollars collectively and change billions of lives for the better – likely yours included.
“Consumers are loudly demanding a better alternative to their crappy, overpriced internet service.
“This company is the only one on the right side of regulating bodies when it comes to launching its satellite globally.
“Meaning, it will – without question – have a shot at 100% market domination.
“And that market share could boost its stock price — giving you the shot to turn a small $100 private investment into $52,900.”
And Bezos isn’t the only backer…
“… the backers’ list on our Sky-Fi company is so impressive.
“Charlie Walker (World’s 1st Commercial Astronaut)
“Together, these billionaires & tech geniuses have stepped up to the plate getting these microsatellites off the ground and into space.”
So what is it that they’re pitching? This is the little space startup Solstar, which is indeed a private company that has done some public equity fundraising in the past — they raised a few hundred thousand dollars on WeFunder last year (a small portion of the million dollars they were looking for, it appears), and perhaps they’ll do so again soon. I haven’t seen an active campaign from Solstar on any of the crowdfunding/angel platforms, but perhaps there’s something percolating that I haven’t yet seen.
And yes, NASA and Bezos and Charlie Walker are all at least somewhat connected to Solstar — they got a ride on one of Bezos’ Blue Origin rockets for their initial test, NASA subsidized that trip, and Charlie Walker submitted a note on their WeFunder page (maybe he invested, too, I don’t know). They’re not aiming to provide “$7 Internet” for terrestrial consumers, however, they’re trying to build a WiFi network for people and equipment IN space based on their Schmitt Space Communicator — basically, a hotspot for astronauts and space tourists.
So yeah, perhaps interesting, and you can see how they could develop this equipment with a relatively small amount of funding (as opposed to the billions of dollars OneWeb and SpaceX and others are spending to build and launch giant networks of microsatellites with that goal of providing LEO internet access), but it doesn’t sound like it’s going to change the world or make a dramatic splash anytime soon. But “internet service from space” is a way bigger potential business, at least for the foreseeable future, than “internet service for people who are in space.”
Which isn’t to say it can’t turn into something bigger someday, I wish them the best. If you want to see some coverage of the story, the local New Mexico media certainly covered it, probably the best story is from the Santa Fe New Mexican here and includes that photo of Bezos and Solstar’s M. Brian Barnett which Crowdability also used in its ad. And about a year ago, they were still talking about raising another $800,000, perhaps from a strategic investor, though I haven’t seen anything more recent.
Which is pretty much all I can tell you — it’s not a public company, I haven’t looked to see if they’ve done any filings to raise more money since that crowdfunding effort they launched in the Summer of 2018, and I have no idea what their financial status is… but if you love the idea of becoming a telecom pioneer in space and maybe becoming some future generation’s Ma Bell, well, maybe you should give them a call and see if they’re looking for more money.
But no, you’re not getting $7 internet, either from Solstar or from OneWeb or anyone else, anytime soon (yes, though this is completely unrelated to Solstar other than the fact that the same basic spiel is being used to pitch the investment, but I should note that OneWeb and SpaceX’s Starlink have both launched their first satellites, and they aim to provide some broadband service in 2020 or 2021, and Amazon and others are perhaps not far behind… but I wouldn’t hold your breath on that “$7/month” notion, the core idea is to provide better service in more of the world, particularly rural areas, not necessarily to provide dramatically cheaper service).
Any thoughts on this one, or on angel investing in general? Feel free to shout ’em out with a comment below. Thanks for reading!