Latest / AST SpaceMobile Podcast / Kook's Weekly - October 6

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Kook's Weekly - October 6 · AST SpaceMobile Podcast

0:06
This is the AST Space Mobile podcast, just basically.
0:11
From your phone and be seamless regardless of where you are.
0:15
We don't want the user even to know that it's connected by
0:17
satellite. Listen, the opportunity that we
0:22
have is very, very, very large. Good evening everyone.
0:29
It's the first time. Looks like I'm actually early.
0:31
It's 829, but looks like it's the first time we're a football
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game ended perfectly on time. That was a great Bills game, but
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even a better Mariners game for anyone that wasn't watching
0:42
earlier. So now we get into the sport of
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being disruptive telecom investors, which many people
0:51
said was impossible, but here we are.
0:55
So we had a really fun week. What's nuts about it is that it
1:02
wasn't really a surprise that this would happen, but it goes
1:07
to show you how important operational execution is in its
1:13
final certainty. And so the big news we'd lead
1:16
off with this week is FM 1 and FM 2 having firm ship dates.
1:25
And so FM one, which is Bluebird 6 is going to fly to India on
1:31
Antonov. That's pretty, pretty cool on
1:34
October 12th. And so this was really the event
1:36
everyone was waiting for the kick off of the Next Gen.
1:42
program. And then, you know, I think the,
1:46
the thing that really caused the market to go, I think Berserk
1:49
was that FM 2, which is also Bluebird 7, is going to be
1:54
shipping to Cape Canaveral in October.
1:58
So what does that mean? Indian rockets don't launch in
2:04
Cape Canaveral. Blue Origin does launch in Cape
2:09
Canaveral and ironically is launching a rocket at the end of
2:14
October, but is almost undoubtedly not launching
2:20
Bluebird the 7th. And so the only real take away
2:23
from this tweet the company put out is that FM 2 is going to be
2:29
going on Falcon 9 probably in November.
2:35
So all of a sudden what people are seeing is that the
2:39
debottlenecking of our satellite production has more or less
2:46
concluded. I I say more or less because of
2:48
course they got the first two done.
2:52
And then there's, you know, bunch of them that are in
2:55
various stages of production once those get shaken out.
2:59
And so hopefully those will just roll off the production line
3:03
without a hitch. What we know is that as they
3:07
were building these first NextGen satellites, it was quite
3:10
difficult to engineer the control sat.
3:12
But once you get it done, you can just pump them out.
3:17
And so hopefully that's what's happening.
3:18
And so then what we should then expect to have is start to get
3:22
into the real launch cadence. And what I mean by real is
3:25
actually Falcon Nines filled with three to four satellites
3:29
and Blue Origin launches filled with 6 to 8 satellites.
3:33
This is when you start to have the scale launch program kick
3:36
off. And we're now on the precipice
3:39
of that. And that's what the market in my
3:41
view was largely reacting to is what we have is a a stock that
3:46
is not forgotten anymore. It has a real market cap.
3:49
It's trading huge amounts of volumes.
3:52
I know I'm personally getting a lot of inbound calls from
3:55
friends that working funds and finance, that's my world.
3:59
So people that work at at real firms are now really being
4:04
forced to look at this and in calling me.
4:07
And what's interesting though, and then they don't have the
4:09
sort sort of malintent of expert consultants and things like
4:12
that. But when they call, they are
4:15
always asking, well, but what about SpaceX?
4:18
You know, so they're still in that early phase of their
4:21
learning, which is fine, where this, the typical short sound
4:25
bites are the things they sort of have to get their head
4:27
around. But they are.
4:29
And which is why they're calling me because they're basically
4:31
being forced to get up to speed on this thing 'cause it's 'cause
4:34
it's going up, You know, stock price weights the news as as
4:37
I've said for many a year, but this operational execution is
4:42
important. And so Kevin Mack would say that
4:45
the stock market is efficient. It is in some respects.
4:49
And so let's take a Kevin Mack world view that everything is
4:52
priced in. And so on Monday before this
4:55
tweet, what was priced in, the potential for more uncertainty
5:00
in the potential for runaway delays and increased slippage
5:04
was what was priced in. Now what's interesting is many
5:08
of us had very, very high certainty levels that FM 1 was
5:13
complete and had cleared all the issues.
5:15
We had alluded to that on last week's spaces.
5:19
And you could there's some ways you could have really increased
5:23
your confidence level of that and we did.
5:26
And that's why a lot of us have really big positions, But the
5:30
market obviously didn't have that same confidence.
5:32
And so then with this tweet that the company put out that that
5:36
really de risked this operational execution component
5:38
and then the market re racked market efficient.
5:41
What's interesting is strong for market efficiency would say that
5:45
the market should have known what we felt like we knew, but
5:49
it didn't. And so it was only pricing in
5:52
what was just press released public news, but then it
5:56
adjusted. And this kind of goes to my
5:57
point is there's so many cards to flip with this company that
6:02
anyone that says, well, the market is efficient, it's kind
6:05
of a silly thing. You can spend circles around
6:07
arguing and I think it's kind of stupid.
6:09
The market is competitive and a lot of people are trying to
6:12
figure out the same thing. But companies are dynamic and
6:16
we're not arguing about the value of a closed end fund that
6:19
owns dollar bills and you have a clear NAV.
6:24
We're debating something that is dynamic, ever changing, full of
6:28
uncertainties, both good and bad.
6:32
And it's very difficult for anyone to conclude that the
6:34
stock price should be a exact certain number any day when
6:38
there's all sorts of changing news.
6:40
And that's what was kind of interesting about the the Kevin
6:43
Mack comments a while back about Legato and then what we're
6:47
seeing in this sort of rapid RE rating of this company,
6:50
admittedly in a strong stock market too.
6:52
And this is what Ampan Mann and I always sort of dreamed about.
6:56
I mean, for the past five years, we'd always look and go, Oh my
6:58
God, this is like the best time for Scott to put out some news
7:02
and we finally have a really good stock market.
7:04
Well, we kind of have the granddaddy of them all right
7:07
now. We have a company that is really
7:09
now ending its news vacuum. Interest rates are going down.
7:15
The secular backdrop for defense spending is crazy.
7:18
The secular backdrop for strategic investments, things
7:21
that are sort of we're not sort of that are important to the US
7:24
and national security and effectively defense arms race is
7:28
very important. All of these things are are
7:30
happening at the same time, which is great, which we'll get
7:33
to in a second about what that could mean in terms of the
7:36
valuation. But this operational de risking
7:39
is a very important point that could be easily overlooked by
7:44
casual market participants. Could someone say, well, of
7:47
course, you know they, they obviously we're going to have to
7:50
deliver FM 1. Otherwise this company would not
7:52
be worth anything. And the the question is, were
7:55
they going to have this runaway slippage?
7:57
If you are a kind of an experienced investor, if you
8:01
start to see a project go over time, that almost 100% means
8:07
usually over budget. And the passage of time can
8:09
sometimes not mean the closing of the risk, but sometimes it
8:13
can be the expanding of the risk.
8:15
And that's why as FM 1 slipped from April to May to blah blah
8:19
blah, that's why you know you. That's frankly why shorts
8:23
probably piled in because the muscle memory of of similar and
8:27
like kind analogs would generally be problematic.
8:32
And the reason why people like me and you know, a lot of the
8:36
other people that post on this company took the other side is
8:39
is we just had a lot of conviction that this was not a
8:41
runaway to the downside project and in fact the opposite.
8:45
So anyway, here we are. We have a really nice post on
8:48
Reddit from Tanner and I didn't realize his screening on Reddit
8:54
was TKO. Makes sense.
8:57
Tanner Kirk Ottaway But now I'm thinking about the guy that
8:59
makes me do all these push ups every night.
9:01
I think he's TKU so I don't know what to believe anymore.
9:05
Tanner has a burner account that's been making me do push
9:07
ups all the time. Maybe maybe this is all one big
9:10
joke. As I do this podcast, I'm
9:14
questioning the reality as I know it.
9:16
But anyway, Tanner on Reddit put out a really interesting thread
9:22
that was highlighted by Regeron, which is my second tweet.
9:24
It's called Tanner on operational scaling.
9:26
And so Tanner has Tanner self doxed.
9:31
And so everyone knows who Tanner is.
9:33
And he's a petroleum engineer, which means he's very technical
9:38
and he's very smart. He's a guy I talk to all the
9:39
time. And so this tweet is really
9:42
interesting because he goes through kind of what's changed
9:45
and you can easily see a stock price go from 2 to 70 and think,
9:49
oh, I missed it. But it's also really important
9:51
to understand the things that change.
9:54
And so a year ago when they really didn't have very much
9:57
cash, they didn't have the warrant exercise.
10:00
If you anyone remembers the advent calendar that I did, the
10:04
the warrant money to me was a game changer because that's what
10:07
allowed them them the company to step on the gas to scale.
10:11
But the the constraint for how this company could actually
10:14
invest in its own capacity was self limiting by its balance
10:17
sheet. Now with these cash balances, as
10:20
Tanner points out, they really have the ability to step on the
10:23
gas and get to this faster cadence.
10:26
And a point that I I had made, I'm sure at some point was when
10:32
people would cry about dilution, you know, effectively the act of
10:37
raising money, it was misguided. What you needed to look at is
10:41
relative to the current stock price is raising money accretive
10:45
in that it helps facilitate MPV of future growth opportunities
10:49
more than the slice of the company that you're giving away.
10:52
And then you had Andrew Johnson, the CFO of the company, make
10:55
similar comments in prior earnings calls of the the faster
10:58
we raise money, the faster we can invest in our constellation
11:02
and pull forward this value. And then you started to actually
11:06
see this happen with sell side notes of realizing as the
11:09
company grew its balance sheet, it could pull forward, its it's
11:13
build out, pull forward its competitive Moat be first to
11:16
market. And that's what we've now
11:19
slipped into in terms of the market understanding that this
11:23
company can be the winner. And as it invests faster, that
11:27
is a good thing, not a bad thing.
11:29
And so in theory, they just they've already done the capital
11:32
raises. You can see how the capital
11:34
raises were really well received because now the market knows
11:38
that raising capital is not actually net dilutive.
11:43
You are you are being diluted mechanically, but in terms of
11:46
value, it's net accretive. And that's that's an exciting
11:51
thing. And that's really one of the
11:52
point, the points Tanner made in this Reddit thread about how the
11:59
operational scaling is taking place, how the balance sheet has
12:03
really facilitated that, being able to run more shifts, hire a
12:08
bunch of people, get all the testing equipment, all of this
12:11
stuff has really changed what the operating capabilities of
12:15
the company are versus just a year ago.
12:18
It's very exciting. It's a much better company to
12:22
own than it was, you know, in what was really just a blink of
12:25
an eye again ago. And so going back to the sell
12:28
side. So the sell side is taking note.
12:30
Barclays upgraded their price target to 60.
12:33
I will say it once and I'll say it again, I don't really care
12:36
about the sell side price targets that much.
12:39
They're pretty near term looking.
12:41
They will generally follow the stock price.
12:44
Rarely do you get sort of the big brain price targeting
12:47
exercises. Ironically, Deutsche Bank was
12:49
the one that came out and just sort of slapped us in the
12:52
forehead and it's like, Oh yeah, it might be worth $600.00, Bye.
12:56
What this was in the stock was like 10 bucks.
12:58
Like, wait, hold on, come again. And so it's one of the few
13:02
instances where I think I've seen the sell side really kind
13:06
of do the exercise that I do of really trying to squint and see
13:11
the convergence between founder vision and financial reality.
13:14
But even here at Barclays, they do show an upside case of $100,
13:18
a $120.00 per share. And it's always just really
13:21
useful to remember how dynamic this is.
13:24
It changes as cards flip. And sometimes you do get the
13:28
sell side report that really just shows the realm of the
13:30
possible, which I find really useful.
13:32
I, I would love it if sell side reports generally would just say
13:36
we're not going to give you a near term price target.
13:39
That's not what you know the kook is asking for.
13:43
I really want to understand if everything goes according to the
13:48
company's plan and you factor in some of the non linear elements
13:51
of what it means to be successful, what, what type of
13:55
opportunity am I playing for? And so for example, I would have
13:58
loved to have seen that type of analysis on Google back in 2005
14:04
when I actually looked at it. I would have loved to have seen
14:07
that analysis on Meta. I would have loved to have seen
14:10
that analysis on Microsoft and NVIDIA and even things like
14:15
Amphenol just to understand if things go really well.
14:19
If I have a 510 plus your time horizon, what am I looking at?
14:23
It would make investing so much easier because so many people
14:26
would in fact ignore that analysis, but I wouldn't.
14:31
And it's really the reason why I own so much space mobile is in.
14:35
This is one of the rare instances I feel like I can
14:38
really understand what the long term vision is.
14:41
And by contrast to this afternoon, I was trying to study
14:44
quantum stuff, just trying to get up to speed and like, I get
14:47
the sound bites, but I don't have this visceral understanding
14:52
of really what that market looks like and what the business
14:54
models look like and what the opportunity looks like.
14:56
Those things right now I I categorize as like schmuck
15:01
insurance, which is a term term I use.
15:04
And so to me, those are kind of like Bitcoin.
15:06
It's like, I don't know if anyone really understood it.
15:09
Although in fairness to the Bitcoin Bros, they, they did
15:13
have that vision many years ago. You know, if you had asked them,
15:17
they would have said, Hey, we're going to replace money and
15:18
replace God. OK, You know, do you guys want
15:24
to put a straight jacket on? And, you know, but I do want to
15:28
hear those bowl cases and, and then if it does resonate sort
15:31
of, you know, in the, the strings of my soul, then that's
15:35
where I, I would, you know, really take a big bet that
15:37
that's what happened to, to me with ASD space model.
15:40
It's something that just sort of the cumulative experiences I've
15:43
had in my career. I really understood what could
15:47
happen there. And you know, here we are Sunday
15:50
night doing a podcast about it. And long way of saying the sell
15:55
side reports, you should always, in my view, like read them to
15:57
try to understand the impact of vision and what's going on in
16:02
terms of whether a company is creating and or dominating a
16:07
market that is or could become big and also be durable, thereby
16:12
leading for good returns. Those are the things that I'm
16:15
looking for because that's where time is your friend and you can
16:18
just make one decision and then you in theory, you know, and
16:23
this would be an amazing way to live, but you could rewind the
16:25
clock back to December 2000, saw vision, saw founder, you know,
16:31
buy stock, go to bed, wake up in five years and boom, it worked.
16:36
That's a great way to invest. Instead, you know, we've spilled
16:39
infinite amount of ink in time do analysis, which is fine, but
16:43
it just goes to show you if you can zoom out correctly, time is
16:45
really your friend and don't really over over trade things.
16:48
So now let's get back to some more of the news.
16:50
We had Vodafone come out, so literally Vodafone came out to
16:55
go visit Midland. So to me, this was my tip off
16:57
that FM one was going to, was going to, was going to shift.
17:02
Took a lot of crap for that on the Internet.
17:04
Of course people are saying this is below you, kook.
17:07
What? You guys, there's really nothing
17:10
below me. I mean, did they, have they seen
17:12
the ASC cheerleader memes? I mean, I, I don't know, I don't
17:15
think I'm known for having a high bar.
17:18
But anyway, that apparently was like too much, you know what I'm
17:21
saying? Well, I bet they're I bet they
17:22
were at the facility because they were going to ship FM 1 and
17:25
people were up in arms about that.
17:27
And then the next day it's literally FM 1 is shipping.
17:30
And it was really nice to have Vodafone there to break a bottle
17:33
of champagne on it. Spot on.
17:36
And so then Vodafone comes out also, never mind the whole team
17:40
thing, but then are out there talking more about how they're
17:44
going to bring the whole solution to European market.
17:48
So I want to point people to something that's a recurring
17:51
trend and it's very, very important actually.
17:53
So in the second Vodafone tweet, then they they go to the
17:58
Vodafone page. So first things also, all of
18:00
this again is being corroborated with partners.
18:04
And this is a point Tut is very wise to point on.
18:07
Many, many moons ago is whenever AST Space Mobile would put out a
18:11
technical update, it's always in conjunction with their M&L
18:15
partners. SpaceX doesn't do that.
18:18
Do you remember this company called Link?
18:20
They don't do that always Space Mobile does it?
18:25
It's very interesting. And this we now know really goes
18:29
to the risk posture of the company.
18:30
They literally think if they don't have all this verified
18:32
with their partner, they're all going to jail.
18:34
Like they're always they're soak careful.
18:37
They're like, we do not want to trade black suits for orange
18:40
suits. It's like guys, you can also
18:41
just put out a pressure. We see you're awesome.
18:43
No one's going to no one's going to be too upset with you.
18:45
But anyway, they they persist in being really credible by having
18:53
the world's largest M&M's come out and back up everything they
18:56
say. And so here you have the CTO of
18:59
Vodafone explain why they partnered ASC Space Mobile
19:03
Exciting, exciting, exciting. But what is also interesting,
19:06
I'm looking for the exact quote is the concept of data
19:13
sovereignty. National sovereignty is going to
19:17
be a very important trend and characteristic of the systems
19:24
that are successful versus those that are not.
19:27
To take a quick side trip on something I didn't tweet about,
19:32
I was, I'm working on refreshing the DD document for anyone
19:35
that's new to the name, the DD document is still actually
19:38
pretty current. So even though I put it out
19:41
basically a year and five months ago, very, there's, there's
19:46
obviously positive milestones and updates, but if you're
19:48
trying to get your head around the investment that, that
19:50
document is still good. I'm updating it.
19:53
So they'll be a refreshed 1 then.
19:54
I, I would, I'm going to try to have that out by the time the
19:58
launch happens because I'm assuming there's going to be a
20:00
lot of new people that are trying to learn about this as
20:02
well. And I want to prevent people
20:04
from, I really want to prevent people from buying astx that
20:07
double levered ETFI think they're going to get their
20:09
brains blown out on that eventually.
20:11
And I want to prevent people if I can, I'm from just buying
20:14
short term call options. And so even though they're in
20:16
the right security, they somehow find a way to lose money.
20:19
And I think the best way to do that is by sharing in depth
20:22
research so people can understand why it's OK to
20:24
actually be patient. And Rome wasn't built in a day.
20:27
And you can own a stock for more than 15 seconds because that is
20:31
not usually a suitable investment horizon for a secular
20:35
winner. But the Long story short is I
20:41
was reviewing Iris Squared, which is the European system,
20:45
which is really this bastard of a system.
20:47
Like imagine a child that has like 7 dads, very confusing
20:56
child has to overcome many obstacles.
20:58
And so Iris too is that there are many, many fathers of this
21:04
thing. And what's interesting about it
21:06
is they're in Europe, which basically made it makes it an
21:12
unusable system for anyone outside of Europe.
21:15
Their data is no longer sovereign. the US will not use
21:19
it for, for one, they're definitely not going to use the
21:21
European system. But if they were, they're not
21:24
going to have, the DoD is not going to have their data go
21:26
through Europe, no way. And and no other country will
21:31
either. And so then what happens then is
21:33
something like an iris squared becomes sort of, sort of like an
21:36
economically dead, dead system. And if you have a a satellite
21:41
constellation that can only be used over 1 country or one
21:44
region, it's pretty stupid because these are economy of
21:47
scale assets. They're multi client assets.
21:49
You want to be selling capacity as you go around the world to
21:53
depreciate it and amortize that, that big fixed cost.
21:57
And this data sovereignty piece is important in the the account
22:02
mega constellations. If if anyone follows it is
22:05
telecom specific account, very technical, very good.
22:09
And that person wrote a relay on LinkedIn, which which I was
22:12
basically just incorporated into the DD doc yesterday and made
22:15
many points about why this iris squared system is is going to
22:19
suck basically and if it ever actually gets built, why it's
22:23
just a total POS. And what you can see here is
22:26
Vodafone is sitting there really just sort of like shrimping
22:31
themselves, combing their hair, putting on Cologne, doing all
22:34
these things Europeans do that I certainly don't do.
22:37
Clipping their nails, having an espresso, popping a couple of
22:41
Zen's. That's what Sacco's doing right
22:44
now. They're just being their inner
22:47
Peter landmark and being fancy from Liechtenstein.
22:51
And why are they doing that? It's so that when Iris Squared
22:54
hits the wall, you're a will have Sacco to fall back on for
22:59
all of the government use cases, all of the emergency response,
23:03
in my view, probably a lot of military use cases as well.
23:07
AST with their partnership with with Vodafone has created a
23:10
European sovereign system based on the constellation that should
23:14
check all the boxes. And Vodafone is, is no dummy and
23:18
is doing everything right to be in that position.
23:22
And this just goes to just how many billions of dollars of
23:26
revenue do we have sitting around the world waiting to hit
23:30
our account? We don't know.
23:32
But we do know that we have a general economic setup to have
23:35
it happen, which is what's exciting.
23:38
And we'll get to that kind of extension of that logic in a
23:40
second. So we also have Verizon.
23:44
I was just watching, I think you can't remember.
23:46
It was the Mariners game. Yeah, it was the Mariners game.
23:49
It was perhaps one of the most disturbing, disgusting and
23:51
stupid advertisements I've ever seen, which is this Verizon ad
23:55
where a guy walks in to a plastic surgery office where his
23:59
mouth is right above his sternum, implying that the
24:03
plastic surgeon removed his mouth and put his mouth right
24:06
over his heart. And it's just very visually
24:09
difficult to look at. And then they make the point
24:12
that they should honor some plastic surgery contract just
24:17
like Verizon honors the contractor of T-Mobile.
24:21
And why is this plastic surgery firm not as cool as T Verizon?
24:25
I mean, if I if I could have stabbed myself in the eye
24:31
instead of watch that commercial like it would have been a a
24:35
viable option for me in that point.
24:36
It was just the worst ad I've ever really seen.
24:40
And so that brings us to Verizon.
24:41
So Verizon still has this valid letter of consent with the
24:45
lease, which means they are going down the line with AST
24:47
Spilos Mobile. There will be ADA and God help
24:52
us. Please, Verizon, if you're
24:54
listening to all, get rid of that that agency and just
25:00
channel the space mob energy and copy some of our memes and our
25:03
content. We won't charge you for it, like
25:06
just follow Corey and have that psychopath guy and the
25:09
Lamborghini. You will sell more mobile phones
25:11
than the stupid stuff you're doing and paying a lot of money
25:14
on Major League playoff baseball.
25:15
I mean God help you guys that was a terrible ad.
25:18
But at least despite your God awful instincts on marketing and
25:22
how to make customers not even want to look at you, at least
25:25
you're very smart technically and you are having good FCC
25:30
protocol to make sure that your STA is valid to the ACCC mobile.
25:33
So I guess it's kind of like a one step forward, one step back
25:37
type of thing for those guys. We also going back to the world
25:41
of the FCC, we had Legato. So Legato got confirmed, very
25:51
exciting. The next step is getting FDA
25:55
approval. So I added some stuff for people
26:00
we just pulled up on Twitter. OK, so added some slides called
26:04
Legato teaching. So these are some of the
26:06
documents that I will be adding to the DD document when I
26:10
updated, but this is just a preview of it.
26:13
I think it's really important for people to understand the
26:15
legato deal and just take, take a couple minutes and try to read
26:20
these slides just to absorb it if you can.
26:23
Because we talk about legato a lot.
26:24
People throw out some really big numbers, which we believe,
26:27
frankly, but it's hard to sometimes contextualize it.
26:30
You have anonymous accounts with profile pics of cartoons telling
26:34
you that invisible energy waves that you got in bankruptcy are
26:41
worth $20 billion. I I can understand the basis of
26:44
skepticism, but they are and here's why.
26:48
And so the the refresh of this deal is is all here.
26:52
I'll just walk through the slide one just gives you basic
26:53
backgrounds. January 6th.
26:55
This was known to the world, very exciting.
26:57
I couldn't believe my my luck. I had known Magato actually
27:00
pretty well because a lot of my friends are distressed guys that
27:02
do spectrum and they were all involved in light squared, which
27:05
is the predecessor deal, predecessor name of Legato.
27:10
This company goes way back when in my career.
27:13
Then next thing is just really an overview so people can
27:15
understand, you know, what is the deal?
27:16
So it's a long term lease, 80 years for 40 megahertz of
27:22
spectrum in US and Canada, plus an extra 5 megahertz liver.
27:26
Now they get a a free Geo satellite.
27:28
So it's super exciting. It's like if you buy now, you
27:30
get not one but actually just one extra Geo satellite for free
27:35
plus some ground station assets. Order now while supplies last.
27:39
Only cheap price of 4.7 million penny warrants and $550 million
27:43
and $80 million per year forever and a Rev share.
27:48
And honestly by now it was a good deal and very strategically
27:52
important. And now we're at the point
27:55
there's there's more background just for which bands there are.
27:58
If anyone has really good insights into this spectrum,
28:00
just always hitting you up on DMS, I'll incorporate your
28:02
comments. If they're intelligible and
28:07
intelligent, I'll put them into the DDDDOC and and give you a
28:11
citation or footnote if you want, but then also really
28:14
understand the background of this.
28:16
So this, this spectrum really is El Dorado or Shangri-La.
28:21
People have known about it. They've heard about it.
28:23
Many men have died trying to reach this destination, but all
28:27
have believed in its promise. And so there came to be a view
28:32
that this spectrum was just simply cursed anyone who had
28:35
attempted to, you know, get the treasure somehow trimmed to dust
28:42
for one reason or another. But that that history is exactly
28:45
why the opportunity was available.
28:47
So many companies have been burned trying to use the
28:50
spectrum for one reason or another that it just was like
28:54
kryptonite. And the only company that could
28:57
really do it with it was AST Space Mobile, which is why this
29:01
opportunity is so enormously value creative.
29:05
And the background is plagued by a bunch of DoD disputes, which
29:09
itself is very interesting. You know, basically you're going
29:14
to the car dealership to pick a car and you have the Department
29:18
of Defense sitting in the driver's seat revving it, saying
29:20
this is the one we want. Well, there you go.
29:25
So we know that ASC Space Mobile has grand ambitions for dual use
29:29
government and military work. Things like Golden Dome, things
29:33
like PNT position navigation and tracking, which is the backup
29:36
GPS systems, all sort of timing applications, the transport
29:41
layer for the proliferated war fighter, whatever it's called, a
29:47
lot of stuff going on. What better proof point than the
29:49
fact that the DoD views the spectrum as so important they
29:52
actually drafted laws to prevent anyone from really using it.
29:56
And Inmersa, I found very interesting, Inmersa added,
29:59
previously had agreements, one in 2020 for $700 million with
30:04
the Navy, one in 22, which was a $600 million deal with the
30:07
military, another billion dollar deal with the Navy, another $400
30:11
million deal with the Army. I'd have to go back and tie this
30:14
out to Inmersat's actual numbers, which I have not done,
30:17
but these numbers are jaw-dropping.
30:19
And this is a reminder. This was for the use of the
30:22
spectrum in narrow bands sort of applications without the big
30:26
bent Pike that AST space Mobile can use it.
30:29
In fact, I don't think Inmersat was necessarily providing, well,
30:33
they were probably providing narrow band services, but it
30:36
shows you just the realm of a Tam here, which which gets to be
30:41
a really important part of the AST Space Mobile grocery.
30:45
One thing that I wanted to add to this discussion that people
30:49
maybe not have thought about is really the value that AST Space
30:53
Mobile paid. So when, when we think about it,
30:56
the, the relevant comparison we all have now is that SpaceX just
31:01
paid $17 billion, really $19 billion for the Echostar
31:06
spectrum. And so initially when, when
31:09
people like me were saying, I think that Lovato spectrum is
31:11
worth 10 billion, I was sort of laughed out of the room.
31:14
And then I secretly thought, well, maybe it's worth more.
31:16
And SpaceX really just validated and imprinted the fact that
31:19
lesser quality spectrum, roughly the same amount is worth $20
31:26
billion to them. Well, that's a really amazing
31:29
mark to market for the L band spectrum we got.
31:32
Now, what did we pay for? And so at a $50 stock price, I
31:36
mean, this is when I was updating the stock was 50 bucks.
31:38
I could update that fast. That was worth $235 a stock.
31:43
When when this deal was struck, it was really like $130 million
31:47
a stock. They're paying $520 million of
31:49
cash. This is all non recourse funded
31:52
with debt. There's a alternative credit
31:54
firm called Soundpoint, which is leading that loan.
31:57
That loan is in a off balance sheet bankruptcy remote SPV.
32:02
That money then goes onward to MRSAT and then there's the $80
32:06
million a year lease. I discount that and say well,
32:10
let's just discount that at 5%. Those the present value of that
32:14
lease payment is worth $1.5 billion.
32:16
So when you add up everything AST spent about $2.3 billion for
32:23
in present value for the spectrum, then you add where I
32:27
add the the royalty. So we're all very optimistic
32:33
about ASD Space Mobile. So if you assume the company's
32:36
going to do $5 billion at some point of revenue in North
32:38
America, just making up a number that annual royalty will be 1/4
32:42
of a billion dollars a year. Again, discount, discount that
32:45
forever the PV of that royalty, which is consideration, you
32:49
know, paid in a way it's money that's going to go to, it's
32:53
going to go to Legato. We're not not necessarily a
32:56
cost, but one way to think about this which we'll get to next is
32:59
money that we share with others is, is maybe money that goes off
33:04
off the gross value. So if the gross value is 20, but
33:08
then you have a royalty that goes to someone else worth 5
33:10
billion, then the the net value to you is 15 billion.
33:14
So when you add the cash, the lease, the shares and then a a
33:19
real loosey goosey estimate of the royalty that takes the total
33:22
consideration we paid on a present value basis at 5% of
33:26
roughly $7 billion. So $7,000,000 versus 20 is a
33:30
good deal. The next thing I wanted to
33:33
introduce is a rough way of valuing legato spectrum.
33:38
And so this is some math I need to sit down cat see around.
33:41
But you can take the spectrum, we got 45 megahertz and you can
33:45
go through some satellite math, which I, I won't do verbally on
33:48
this call because I'm sure people will not be able to
33:51
follow it. But you can start to understand
33:54
that we have various spectral efficiency assumptions.
33:57
So basically how efficient we can use the spectrum, how we can
34:02
reuse it because we have a lot of satellites and they have
34:04
different beams. And then we take some
34:07
utilization factors and, and things like that.
34:09
And we ultimately can say, well, where are we going to be selling
34:11
capacity? In my view, we're selling
34:13
capacity somewhere between 2:00 and $20 a GB.
34:17
We're seeing that monthly rates for crappy services are like 10
34:22
bucks a month, but the people using SpaceX and Starlink are
34:26
not using a GB of data for intermittent texting.
34:29
So when you actually think about the value of the data, $20 per
34:33
GB does not necessarily mean $20.00 per month.
34:37
Here's an important distinction, but the, the punch line is you
34:40
can start to bridge revenue capacity against the legato
34:45
spectrum of somewhere between $1.5 billion and $30 billion
34:51
gross per month. So the difference between $2.00
34:53
per GB and $20 per GB, 2 bits per Hertz versus 4 bits per
35:00
Hertz. You, you can see these
35:01
assumptions in the tweet. You get a very wide range of
35:04
course, but it ends up being very interesting.
35:06
And I think this is the first time I've seen anyone try to put
35:08
a number on the, on the value. And then what I do is I say,
35:13
well, what is this actually equate to in terms of value per
35:18
Hertz in, in revenue per sorry revenue per megahertz.
35:23
And then I compare that to AT&T in terms of their annual dollars
35:26
dollar revenue per megahertz, which is roughly two $250
35:32
billion a year of revenue per megahertz of spectrum and
35:35
Verizon which is roughly 300, sorry $250 million.
35:41
And then Verizon is $300 million per megahertz.
35:45
And then I, I checked that in terms of what my assumption ties
35:47
out to. And that ties out to these big
35:49
numbers of, you know, roughly $15 billion a year gross for AST
35:55
Space Mobile just on the North American Legato spectrum.
35:58
And that's what we can start to form the idea of, well, what's
36:01
this company's revenue capacity going to be, which is a really
36:04
important thing to have in the back of your mind.
36:07
So where we started off with this conversation is the sell
36:10
side being able to zoom out and really see what the future might
36:13
hold if things go well. Now, no one's going to be
36:16
putting out a $15 billion per year revenue estimate on Legato
36:22
spectrum alone. You truly would look like a
36:25
kook. However, you can do that math to
36:27
see the realm of the possible. Just like you could have done
36:30
some math to figure out what the search market opportunity was
36:33
for Google in 2005, You could have done the ARPU math for
36:37
Facebook in 2007. You could have done those
36:41
things, You would have looked ridiculous.
36:43
I am ridiculous. I did that math for Tesla back
36:46
in 2015 because I was trying to copy Ron Baron and I could see
36:51
what he saw did Did I buy Tesla? No, but lesson learned.
36:55
That's my Steve Larrison moment. You know, really seeing these
36:58
things where if if I had just looked at it in a different way,
37:02
really dumbing it down, frankly, and just seeing where the vision
37:05
can collide with financial reality and then sticking to my
37:08
guns and being long term, the results can be astonishing.
37:12
But the key is to figure out the right frameworks to apply.
37:16
And then obviously you have to be right.
37:18
But that's the punchline. I think I probably blabbered on
37:20
too long about Legato, but we'll revisit this later.
37:23
But you can see some of the math I put out.
37:25
If you people see mistakes in it, please DM me and I'll
37:28
correct it. And but it's exciting to start
37:31
to put some revenue potential numbers on this company now that
37:34
we're getting really close to revenue.
37:39
And the other thing, we have only 6 stitches put out.
37:42
Just, you know, the obligatory employee count estimates, which
37:47
show we continue to really grow and scale and take the
37:49
opportunity. Also this week we had Scott give
37:53
an interview. It's really more of the same,
37:55
which is great because he has a great punchline to talk about.
38:01
Then he's very excited. So I'd recommend people listen
38:03
to him on Bloomberg. More people are being exposed to
38:05
this the more people hear Scott talk, even if he repeats himself
38:09
every single time. It's great because he repeats
38:12
himself and he's right. Then he's credible.
38:16
But then Scott has to compete with Ampam Man who blew him away
38:19
with a 2 hour talk. I didn't have time to listen to
38:21
this because I decided to have to try to start living my life,
38:24
but I heard it was great. And so the the link for Ampam
38:29
Man's spaces is is linked here. You can listen to it if you
38:33
want. And then we also had more tech
38:36
validation. So going back to the way this
38:37
company works is when they do things, they put it out with
38:41
their partner. So we had some great releases
38:44
with Vodafone. Oh, and this is actually where
38:47
the national sovereignty might have been.
38:48
But then we had Bell. You know, Bell Canada came out
38:52
saying that they similar to AT&T and Verizon had achieved
38:56
Canada's first ever space based 4G voice over LTE voice call,
39:02
which is an accomplishment. And so again, this is where the
39:07
use of an M and OS sovereign gateway infrastructure comes in.
39:12
And this is different from an experimental satellite to phone
39:15
test when you're using a specialized modem or narrow band
39:18
protocols, which is really what SpaceX is doing a lot of doing.
39:21
A voice over LTE is fully packetized low latency calls.
39:27
They are using Bell, they're demonstrating sustained
39:31
broadband throughput, They're integrating to the existing
39:34
telecom backbones, They're using 3 GPP protocols, and they're
39:40
just proving that they can do this without modification on the
39:43
M and OS core, no tricks. These press releases, I believe,
39:51
are very important to partners. We see them and we go, yeah, of
39:53
course, we know it works, but I think these press releases are
39:56
very important for partners. And then we also going back to
40:00
the tact that allows this to be possible.
40:03
Only thing 6 inches was also nice enough to share some
40:07
excerpts from an expert, not an expert consultant, a act for
40:12
former employee. And so I listened to this entire
40:14
interview as a whole. I found it very interesting
40:17
because it's a person that was early the company and and really
40:19
knows it through and through. So I highly recommend to read
40:23
what was shared in its entirety. But what I actually took away
40:27
from this was really interesting observation that is obvious.
40:30
Just to hear it, to hear it is important is when you're
40:36
inventing something that was perceived as impossible, the
40:42
ability to then leave a bunch of patent landmines behind you is
40:48
very high. There's wide breath for you to
40:51
just patent everything because no one else has really been
40:55
trying to solve those problems because there's a first to all
40:59
of us. There is a lot to invent and
41:02
therefore a lot to patent. Very, very valuable down the
41:07
line. And So what I do know for sure
41:10
is AST Space Mobile is a very litigious IP owner.
41:19
The first time I met Abel, this was the first thing he was
41:24
talking about. Is his plan to enforce and
41:27
protect and litigate his patents top of mind?
41:31
And so these guys have tried to to close the door behind them on
41:34
the IPI think there's many other motes here, but what I liken it
41:38
to is this might seem like a crazy analog, but the aura ring.
41:42
And so Aura was really first to come out with a, a wearable in
41:47
the ring form, which had a lot of other problems to solve in
41:51
terms of like how you make a battery work on a ring and
41:53
things like that. And they've been extremely
41:56
litigious too. And so anyone that tries to put
41:58
out a ring product, they get sued by Aura.
42:00
And, and there there's a lot of differences, I think, between
42:03
the, the relative IP, Needless to say, a handheld ring versus
42:06
the world's largest flying football field satellite array.
42:09
But the, the learnings in the lessons from both are the same.
42:16
And I think it's going to be very fascinating just to see the
42:20
challenges people have really SpaceX of, of trying to have
42:25
similar technology down the line when so many of the initial
42:29
inventions were done and solved by AST Space Mobile and what
42:34
that really means for someone trying to be a fast follower.
42:38
So then we have Facebook. So Vodafone put out and said
42:46
that in their, I think it's in Malaga.
42:50
Yeah, Malaga, they have this lab they've set up in partnership
42:54
with AST Space Mobile is for a Sacco and one of the first
42:57
projects will involve A collaborative effort with Meta.
43:01
This initiative seeks to optimize and ensure the high
43:03
quality of WhatsApp audio and video calls once the services
43:06
are launched, guaranteeing excellent communications across
43:08
hybrid space and terrestrial networks.
43:11
Yeah, of course this is what we've been saying the whole time
43:15
is the, the whatever we call now the glorious 7, just big cap
43:20
stocks that go up are all based on the delivery of digital
43:25
services to human needs. They all ultimately have to run
43:31
through M&S. That's the critical path if you
43:38
don't have Internet either through fiber, through fixed
43:42
satellite, through a cell phone tower or through a non
43:47
terrestrial network tower like ASTCS mobile, then you don't
43:50
have connectivity. So my theory the whole time has
43:53
been that AC space mobile is truly one of the world's most
43:56
strategic assets and it it should be no surprise what we
44:01
have Google as an investor. Now we're finding out that Meta
44:03
is working on it. I think that Amazon, well,
44:07
Amazon has already showed their hand.
44:08
They're coming out with Kuiper and I think they might
44:10
potentially partner with space mobile.
44:13
All of these companies really need to have our relationship
44:17
with space mobile because it is what solves, first of all, a
44:21
backup system so that everything is always connected, even when
44:23
the terrestrial systems fail, which they do enough, and to
44:27
cover the dead spots. And as we look to have more
44:32
systems that are running autonomously, which are going
44:35
through areas with dead spots, this system allows you to have
44:39
positive control the whole time, which I'd never really thought
44:42
about, but it's a very important attribute.
44:45
So it's nice to see that we're once again showing that we're
44:49
strategically important. We're having some of the world's
44:51
largest companies start to experiment and and work with us
44:54
to support their own critical really franchise assets.
45:00
WhatsApp, for example, clearly WhatsApp is a great candidate
45:03
for this. You want to have this working
45:05
really well with Space Mobile because a lot of WhatsApp
45:07
customers are in developing countries.
45:09
Makes sense. And then it's also important
45:12
just to realize just how broad Space Mobile is applicable.
45:16
And so just, and that interview with Scott, with Bloomberg, he
45:20
said that this will be used inside a plane.
45:23
Well, adios Gogo, your business just was rendered potentially
45:27
useless. And I get that question a lot
45:31
is, you know, do you have to have line of sight for this?
45:34
Do you have to be out in the field?
45:35
Will this work through walls? Well, that's the benefit here of
45:37
the low band spectrum we're using is it propagates really
45:41
well through walls. It's the good stuff and we know
45:46
that Space Mobile has talked many times about being used on
45:50
planes, boats, cars, trains, Billings, wherever.
45:56
So it's going to just start to RIP apart the Tams of all these
45:59
little point solutions that previous previously had solved
46:02
some of these problems and gobble that up.
46:05
Individually. A lot of those markets are worth
46:06
a lot. There's lots of these 100 to a
46:09
billion dollar revenue a year markets that we should be able
46:12
to just to swipe and take Iridium, you know, has a target
46:17
on the back, for example. And then we also continue just
46:21
to have Scott telling us the defense is going to be a big
46:25
opportunity until red Room put out a cool thread just
46:27
highlighting what they say in QQ 2005, 2025.
46:32
You know, they brought up the government a lot and then Scott
46:34
was just talking about it in the fireside shot on September 3rd.
46:38
He's specifically talking about Golden Dome, but he also
46:42
consistently says we are working on, I believe it's 8 to 10
46:46
projects, programs of record, each of which are $100 million
46:51
plus opportunities per year. These are big numbers and then
46:56
we have more proof. And I got some comments about
46:58
this in my DM so I don't want to hang my hat too much on saying
47:02
that I really understand the nuances of this.
47:04
But we have ASD Space Mobile continually posting for job jobs
47:08
that have top secret security clearance requirements.
47:13
And some of the analysis behind this from people is that you're
47:17
not asking for these people unless you already have this
47:21
work. Well, this isn't necessarily a
47:24
golden Dome giveaway because we know that they have other
47:26
defense work, but it's consistent, again, with a lot of
47:30
defense work and a commitment to it.
47:32
So it's not one off and it is exciting to see some of these
47:36
jobs that really do track pretty well with the type of
47:40
descriptions you'd expect for Golden Dome.
47:42
I just saw actually, because the government shutdown Golden Dome
47:45
announcement might be delayed a little bit more again till
47:48
seemingly next week. I really don't know how Golden
47:50
Dome is going to be brought to the market, but you know, it
47:56
seems like it's happening. And Mike, Doctor Mike put out a
48:01
tweet that just showed a little bit about how the SDA, the space
48:05
development agency is, is being hit by some of this government
48:11
shutdown delay and things like that.
48:12
So I don't know, We've had a lot of good news lately.
48:15
It's fine if some of this news gets spaced out a bit.
48:18
But then others are pointing out that L3 Harris is out there
48:22
openly talking about Golden Dale.
48:24
And so L3 put out a tweet. As the industry's trusted
48:26
disruptor, we're uniquely positioned to deliver American
48:29
made capabilities at the pace and scale required for America's
48:32
Golden Dale. And so people are really
48:35
indicating that this is happening, and I believe it is.
48:39
So then we get to, you know, really this question, you know,
48:42
stock goes up a lot. And I, I know I have a lot of
48:44
people ask me, well, you know, did you sell?
48:47
What do you think it's worth? You know, I remember when the
48:50
stock was 20 bucks, people call me like, well, you can't
48:53
possibly like it as much now as you did when it was 5.
48:56
Stock is, is 20 bucks. You know, it's gone up a lot.
48:59
And I'm like, well, I don't know, like, yeah, obviously with
49:02
the same set of facts, you know, it's better at a lower price.
49:05
But the facts change and they get better and the ID risks.
49:09
And so it's also less risky than it was.
49:12
You know it frankly, this stock is now a less risky enterprise.
49:15
Whether it's a less risky investment is a is a more
49:18
dangerous statement that I will not make.
49:20
But it's a, it's a less risky company now that at any other
49:26
previous moment and now whether it's AI think it's a good
49:30
investment. Still, I think it is going much,
49:33
much higher. And over time, you know, you
49:38
want to see what a Bell's going to do.
49:39
I was thinking about this day when I was walking back, You
49:42
know, when you start, when you start to think, well, what if
49:44
they, what if they lob in, you know, ton more spectrum around
49:48
the world because they're the only real buyer of it.
49:51
And you can gobble up, you know, this global spectrum monopoly
49:56
that only they can really monetize.
49:57
And they have all the M and OS wrapped up who are addicted to
50:00
them because then the M and OS get access to spectrum without
50:03
having to spend $20 billion on it.
50:06
What, what could happen here in terms of what, what this is
50:10
worth? And I don't, I don't know the
50:11
answer to it, but it, it is a big number.
50:14
And that's what gets really exciting.
50:16
And, and ultimately, you know, there's some people I know that
50:18
I talked to, they're in the space mob.
50:20
They're literally just locking away their shares and they're
50:22
just convinced this is going to $1500 per share.
50:25
They're going to be a billionaire and you're not going
50:28
to convince them one way or another.
50:30
And good for them. You know, there's a lot of
50:32
people that do really well holding stock for 35 years.
50:35
You know, here's to you. Larry Ellison, it worked out and
50:38
Steve Ballmer, you know, it worked out and great.
50:42
But in the meantime, you know, the rest of us have to do math
50:46
and try to figure out what we want to do.
50:48
And it's just going back to the Deutsche Bank type of analysis.
50:51
It shows, you know, some further out estimates of what they think
50:56
the free cash flow could be. And so they think that we're
51:00
going to be able to hit these, you know, multiple billion
51:03
dollar free cash flow type estimates.
51:06
It's been pushed out in terms of the timing, which of course we
51:09
know stock has experienced delays.
51:13
But you know, now we're getting to a point where we're right
51:17
there at the ramp and we might have a company doing, you know,
51:20
one $2 billion of of cash flow pretty, you know, in the
51:25
investable time horizon, which is exciting.
51:28
And so then what multiple is that going to trade at?
51:31
I don't know, you know, and that's where we start to look at
51:33
the, the Palantir examples of why does Palantir traded 100
51:37
times revenue. It's a mystery.
51:41
You know, obviously the conclusion in the market is that
51:44
its revenue is going to grow a lot and that they will not get
51:49
displaced. So there's just a lot of, you
51:53
know, maybe it's a meme stock, but there's a the market is
51:56
telling you that there is a lot of conviction and visibility
51:59
that that revenue number is going to grow quite a lot.
52:02
And I think that that type of conviction will likely be
52:05
present with Space Mobile as well, where when we very quickly
52:09
turn on a billion dollars of revenue, the stock market will
52:12
go, well, yeah, now we're going to go to $10 billion of revenue.
52:16
And then you start to argue to over the multiple because at
52:18
some point when there's no more growth, I don't know why that
52:21
would be the case. But in theory, when there's no
52:23
more growth, something's going to trade like AT&T trades, it's
52:26
going to trade at a yield, you know, and so trade it, you know,
52:29
15 times cash flow or something like that.
52:31
You just don't know what that terminal cash flow number is.
52:33
That's the art of this. And, you know, I tried to put
52:38
some numbers around the Legato spectrum, for example, to, to
52:42
help. And that's the type of math
52:44
we're going to have to do over the next couple years as we get
52:46
more information. But then when you just think
52:48
about, you know, the lessons learned.
52:50
I just reposted this exchange, which I remember vividly from
52:53
Steve Larrison. He's one of the real original
52:56
space mod people that for people that don't know you, very sadly
52:59
passed away from natural causes two years ago now.
53:05
But he had, he was a software engineer, a very smart guy that
53:09
educated me a lot about AI and NVIDIA and things like that.
53:12
Spoke to him about a lot of things outside of space mobile
53:14
and got to be friends with him. And he would always share his
53:17
story about really being totally on top of Amazon back in 2001
53:22
and day trading it. Like, I know, you know, a lot of
53:25
people will do that thinking, well, we're going to scalp some
53:29
stuff. And I'm a quote UN quote swing
53:31
trader, like a stupid child going to a swing set.
53:34
I mean, I hear a swing trader and I was like, it sounds cool.
53:36
Then you sound like a kid going to a swing set.
53:39
But he did that and then, you know, Amazon got away from him
53:43
And you know, if he had had forget the math, he had, but he
53:45
would have been worth hundreds of millions of dollars if he
53:47
just held his Amazon stock. And he was adamant that he was
53:50
never going to have that happen to him again and was locked in
53:53
on ASD space mobile to to see it through.
53:56
And it's just always good to to take a step back and I just will
53:59
remind people, if you can, if you can see the intersection
54:03
between a founder's vision and a financial reality and be right,
54:06
which is the important second component of that.
54:10
And you, you don't see a cycle that will take you out or you
54:13
don't see a secular disruption that will take you out.
54:16
Then in my experience, the general answer with these things
54:18
is just chill out, own stuff, go live your life and let
54:21
compounding work. The hard part is knowing if
54:25
you're right and incorrectly seen a high magnitude founder
54:28
vision that intersects with a high conviction financial
54:31
reality. If that were easy, everyone
54:33
would do it. If not easy, but it sure looks
54:37
like it could happen here. And that's where we go into the
54:40
this is very hard to value. And so we have a tweet from Alex
54:44
from Babylon and you know, you just put out some reasons why
54:49
he's exciting and just, you know, talks about the sales
54:53
model. It is exciting to have what's
54:55
called a go to market where you can effectively instantly reach
54:58
3 billion customers without cap customer acquisition cost
55:04
because you have these partnerships.
55:07
It is exciting when you have a technical lead on the boogeyman
55:11
SpaceX of of years potentially and then of unknown patent
55:16
difficulty to copy you, but certainly not easy.
55:20
It is exciting when at worst you have what looks like a duopoly.
55:24
It is exciting as we get more de rest, especially with FM 1 and
55:28
FM 2 shipping. It is exciting when Brandon Carr
55:33
basically rewrites the regulatory rules for you.
55:36
It's exciting when you get 45 megahertz of spectrum for really
55:44
nothing. There's a lot of really neat
55:46
things happening here and, and now we're starting to see really
55:51
some of the fruits of our labor coming.
55:53
And so then also this week, just to show you how important this
55:56
company is becoming, it's really no longer on the fringe.
56:00
Jennifer Manor, who's our spectrum guru from Echostar,
56:06
She's joining the three GPP consortium.
56:10
So she's right there at the high table helping to write the
56:13
future protocols of the open standards that everyone uses.
56:17
This I think is far more important than a layman would
56:20
really understand. And this is really an acceptance
56:23
to, you know, the adult table. And so she's going to be a board
56:27
member of the USITU Association. She's very accomplished.
56:31
She's a thought leader in the industry for spectrum, a crucial
56:36
executive at AC Space Mobile as we navigate very complex
56:40
spectrum issues all over the world.
56:43
And now we have, you know, full front, front seat to everything.
56:50
We're also just seeing little things clean up back in the day
56:52
in this, you know, just tells you where we were.
56:54
People would freak out when there were these like random
56:56
ambulance chasers finding lawsuits of class actions.
56:59
These things are dismissed. I want to see someone sue some,
57:02
you know, sue AST management now for for having the stock be one
57:07
of the best performance stocks in America.
57:09
Case dismissed. And then the space mob is is
57:13
really starting to correct misinformation.
57:15
I always thought it was awesome how we were able to community
57:18
note the Starling DP of engineering when you put out a
57:22
totally false statement around them being 1st and we we got
57:25
community noted to correct that so that the world could see.
57:29
You know, there are a lot of people that follow SpaceX post
57:32
and now have a community note that says, well, actually AST
57:35
space mobile did that. Hopefully, you know, there's
57:37
some conversion rate of people they'll go.
57:39
I wonder what AST space mobile is.
57:40
I'm going to look into that. But of course, we got censored
57:43
and Elon took away the community note or we just got brigaded by
57:47
all the space hacks Bros. But one way or another, we're
57:51
trying to shed light on all that is good.
57:55
And then the last thing we have is just a really cool video from
58:02
Chris. Yep, Chris put out a really cool
58:05
video he has from time to time just to get people, you know,
58:09
kind of a celebratory mood. And there was a lot to celebrate
58:12
with the stock price performance then.
58:16
Yeah, just be careful out there. I know a lot of us have lived
58:18
through quite a lot of these rapid, appreciable moments in
58:23
the stock. It's very, very fun when it goes
58:25
up. Stocks sometimes correct, they
58:27
consolidate. And I don't know.
58:30
I don't know if we're going straight to 100.
58:32
I have no idea. But that's why I also, you know,
58:35
when the stock is ripping like this, I tend to go pretty quiet
58:38
because my mental sort of constitution in markets that are
58:45
so happy is, is not really what I was built for.
58:48
I'm more of like a battle, battle in the mud type of guy.
58:52
And so when it's all kind of working, I just figure I'm just
58:54
going to shut up, let people enjoy the moment and work on my
58:59
DD update. And, and I also, I, I don't want
59:02
to be end zone dancing, one, because it's bad luck.
59:06
And two, I don't want people then getting kind of imprudently
59:11
excited and start to, you know, bet real money that they can't
59:14
afford to lose in options and things like that.
59:16
I don't want to encourage any of that because we know we've all
59:19
seen the the negative consequences when people get
59:22
blown up. But I have a massive position.
59:25
I'm very excited about it. And you know, think I think not
59:30
in terms of share price, but I think in terms of market cap.
59:32
And so when we zoom out, we've got, you know, roughly A20, we
59:37
have $25 billion more or less market cap company.
59:41
And you start to go, well, OK, what what is the size of my
59:45
secular opportunity? Will I win it and will it be a
59:49
growth market from there and an important market from there?
59:53
And I'm I'm still of the view as people say, well, you know, it's
59:56
not going to be a winner take all market.
59:59
And and I corrected my friend that called me today.
1:00:01
I went, yeah, you know, I agree Starlink might have a chance at
1:00:06
having some small secondary role.
1:00:08
You know, and so to me it's a winner take most market.
1:00:11
I don't know why people don't say that.
1:00:12
People always say it's not going to be a winner take all market.
1:00:15
And it's like, yeah, duh, you know, sure, it's going to be
1:00:17
winner take most. And that is to me a crucial
1:00:20
distinction when I think about my position is I think it's
1:00:23
going to be winner take most. I think ASTS is going to take
1:00:26
most. I think Starlink is going to be
1:00:29
a distant second. That has certainly a lot of
1:00:31
advantages that it can bring to bear.
1:00:33
But this is a different market. There's nuances that are
1:00:36
different from the ways in which Elon has previously been
1:00:38
successful. I think it is going to be a very
1:00:41
big market. We've seen the rough estimates
1:00:43
of what the annual revenue estimate is for this.
1:00:46
I think that's going to be low that that number, for context,
1:00:50
is like a $30 billion market per year.
1:00:52
Assume we take 2/3 of it, That's $20 billion of revenue per year.
1:00:56
I think that is going to be a bigger market because I think
1:00:58
people are going to invent uses for this technology that don't
1:01:00
exist today. And that's what's exciting about
1:01:02
the this type of investor. And so then you go what's what's
1:01:06
that worth? People threw out these like 90%
1:01:09
EBITDA margins. I don't know, you know, there's
1:01:11
going to be cost. This company is going to want to
1:01:14
be spending R&D and having people and things like that.
1:01:16
We'll see where the margins really stack out.
1:01:19
I guess it's, it's theoretically possible because the way the
1:01:24
accounting works is 90% EBITDA margin is already taking into
1:01:29
account the the revenue shares that they have.
1:01:32
So it really you can kind of say what it actually is, 90% margin,
1:01:36
but ultimately the company isn't sort of violating the laws of
1:01:39
nature. There's really a way it can all
1:01:41
make sense. Then you get these big numbers
1:01:43
and is that going to be worth 10 times revenue?
1:01:45
Sure, why not? And that's $500 per share.
1:01:51
So that gives you a really nice, you know, return profile from
1:01:54
here, which is nice to have. You always want someone that's
1:01:57
buying the stock at the all time high price.
1:02:01
You want them to make money. And I, I hope that they will and
1:02:06
I think that they will. So I'll end here.
1:02:08
Thanks everyone for joining me. We have God knows what this
1:02:14
company is going to announce next.
1:02:16
I mean, they seem to be really on a roll.
1:02:17
But we have next week we will have FM One get on an airplane
1:02:24
and that will be really exciting for a lot of us.
1:02:26
And then followed shortly thereafter, we're going to have
1:02:29
FM 2 get on a truck. And at this point, I almost want
1:02:33
to volunteer to like escort it just to make sure, just kind of
1:02:37
lead the way in like a safe car, like a Volvo or something.
1:02:40
So if something gets in our way, at least we can, you know,
1:02:42
convincingly take out an obstacle and know the Volvo will
1:02:46
survive. So Belle, if you're listening to
1:02:48
this and you need like caravan of people that rent Volvos to
1:02:51
clear the way for you, consider us down to get you to the Cape.
1:02:54
So some good news there and maybe some golden the Dome
1:02:59
updates. But my hopes frankly, are not
1:03:01
that high. I think that might just take a
1:03:02
little bit of time to percolate. So have a good weekend everyone,
1:03:05
or a great rest of your week. And we will reconvene next week.
1:03:08
I'm going to be camping again next week.
1:03:10
So I'll be rolling into this pretty tired, but I will.
1:03:14
I will be here in some way, shape or form.
1:03:17
Talk everyone. See.
1:03:39
Let's go. Now we're climbing high.
1:03:47
Able got that fire. He ain't never getting tired.
1:03:50
All the signs flashing, buddy. Steady with the ground.
1:03:52
No cashing out now. Got the future on his mind.
1:03:55
No shit, soul. Not a single one gone.
1:03:58
He's the king of the stronghold. Strong staying home.
1:04:01
This is his baby. Ain't doing it from scratch from
1:04:04
2 to 68. And he ain't looking bad from 2
1:04:07
to 68 here. We on the rise.
1:04:09
Able build it up. Never sold.
1:04:11
No surprise he owed no salary. Just that vision in his eyes.
1:04:31
Beam steering tech got the world in control.
1:04:34
People got the vision, they flying high and wide steering,
1:04:37
no beams covered in nations worldwide.
1:04:40
Nobody compete with the Bluebirds up there yet.
1:04:44
They can't be beat. You're taking it further
1:04:46
outside. A lot of lines with those birds
1:04:48
in the sky. I feel free to fly.
1:04:50
Don't get stay by singing women. Let's go.
1:04:56
We're 68 here. We all arrived.
1:04:59
This table built it up. Never sold.
1:05:01
No surprise. He owed no salary.
1:05:02
He's just a vision in his eyes. The storm beneath his baby
1:05:05
white. The touch the sky.
1:05:19
Is about changing the game, leaving the world better.
1:05:22
That's the reason he came. Bringing people closer,
1:05:25
connecting the globe with the Bluebirds flying.
1:05:28
The vision unfolds, building up tomorrow like no one did before.
1:05:32
Every move Able makes is the open new doors.
1:05:34
Like seeing the stars written bold and clear.
1:05:37
He's changing the world at the mission right here from 268.
1:05:47
Yeah, we on the ride. This table built it up.
1:05:49
Never sold. No surprise on the salary.
1:05:52
Just that vision in his eyes. This companies, his baby.
1:05:55
Watch it. Trust the sky.
1:05:57
Oh, God, the cashier. You can feel it in his soul.
1:05:59
He's the kind of man you wanna trust.
1:06:01
Let your money roll. Invest in his drive.
1:06:03
He's here to make a change. Not just building well, but
1:06:06
reworking the game. He's thinking already.
1:06:09
Never settling for less. Going all in.
1:06:11
He's on a mission for watch him break the mold making history
1:06:15
again and leave a live cable left where you should spend one
1:06:19
more time. Facebook.
1:06:24
Come on. I want to hear your left here.
1:06:31
We on the right table build it up.
1:06:34
There was so no surprise scene on the side of Reed.
1:06:36
There's a vision in his eyes. Nobody needs a baby watching
1:06:39
touch the sky. Steer the beams make them shine
1:07:08
largest in the game satellites reader fly.
1:07:13
It is changing the world future on his mind.
1:07:19
Even it better satellite at a time.
1:07:24
Let's go space mom. We fucking unfurling.
1:07:30
Time to connect unconnected. Thanks for listening to the AST
1:08:07
Space Mobile Podcast. If you enjoyed this episode and
1:08:11
you'd like to help support the podcast, please share it with
1:08:14
others, post about it on social media, or leave a rating and
1:08:17
review. To catch all the latest news
1:08:20
about AST Space Mobile, make sure to subscribe.
1:08:23
Thanks again and I'll see you next time.
1:08:29
We're doing something very, very big and I think with this
1:08:31
technology we can really affect billion lives.
1:08:34
AST Space Mobile is the only company that has proven
1:08:38
technology to deliver several mobile connectivity directly
1:08:42
from the state To do everyday smartphone.
1:08:45
People will just basically turn the phone and be symbols
1:08:49
regardless of where you are. We don't want the user even to
1:08:51
know that it's connected by satellite.
1:08:54
Our role is to bring this into reality, always in partnership
1:08:58
with the MMO Listen. Waffles.