Latest / AST SpaceMobile Podcast / Kook's Weekly - January 19 - Golden Dome Confirmed, Blue Origin Synergies, and the Dual-Use Validation

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Kook's Weekly - January 19 - Golden Dome Confirmed, Blue Origin Synergies, and the Dual-Use Validation · AST SpaceMobile Podcast

0:06
This is the AST Space Mobile podcast, just basically.
0:11
From the phone and be simplest, 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. OK everyone, thanks for joining.
0:30
It doesn't let me adjust the start time anymore.
0:32
I mean, say what you will about Elon, he's sort of neglected the
0:36
X app. It's kind of crazy.
0:38
Some of the basic functionality that doesn't work anymore.
0:42
And I know that a lot of people hate the chat feature now where
0:44
it's like you have to let it catch up for a couple minutes
0:48
before before you can do anything.
0:50
But anyway, I was traveling all weekend, so a little bit behind
0:53
on everything, but we finally had the thing happened last
1:00
week. We had been speculating.
1:03
We're not blind speculation, but really based on our diligence
1:08
and understanding of the technology and the company's
1:11
initiatives that ASTS would be a government contractor.
1:17
And that's what we got. But before we get to that, let's
1:21
first just knock out some of the simple speculations.
1:25
The cadence of people putting one and one together on the FM 2
1:30
launch is growing to a critical mass where I've decided to
1:34
release the meme. And so I had very carefully made
1:36
a meme of a bell as Rambo shooting a new Glen rocket.
1:41
And I thought I was so clever for this, but I wanted to save
1:45
it until it started to become more and more confirmed in the
1:48
market. So there's quite a lot of
1:50
evidence now that FM 2 is going to be launching on New Glen 3.
1:55
There's reasons why this is very synergistic.
1:58
New Glen is going to be having its third launch of what is a
2:01
four launch requirement to qualify for government business.
2:06
Meanwhile FM 2 is an SDA government satellite.
2:10
And so pairing the two makes quite a lot of sense in what
2:15
anyone could just simply say is a congratulatory moment for both
2:19
companies. And so we have ample evidence,
2:22
photographic evidence actually that there is a very meaningful
2:27
business deal between AST Space Mobile and Blue Origin.
2:32
And so them pairing up in this way to demonstrate joint
2:35
capabilities as they've also separately put out in their own
2:39
web page of supporting Golden Dome.
2:43
We saw a lot of reasons why these companies are going to be
2:46
working together as they jointly trial some of the new
2:49
technologies. But then in the future,
2:51
obviously that relationship is going to scale massively.
2:54
But then on to Golden Dome. So that, you know, one of many
2:57
hints to me was when Blue Origin had put out the 9 by 4 version
3:04
of its rocket, So the the big dog rocket.
3:08
And in the description of the clients they're serving, they're
3:12
very specifically named AST Space Mobile and Golden Dome.
3:16
And so that was just more confirmation to us.
3:21
Call it hopium, if you will, but just more confirmation that ASTS
3:26
in its capacity as serving Golden Dome was going to be
3:29
using this larger enhanced, frankly somewhat customized
3:33
rocket to deliver those capabilities.
3:36
And here we are. And So what we saw on Thursday,
3:40
some some really exciting news is Space Mob as always was quick
3:44
to hunt down the government's on sam.gov and saw AST space Mobile
3:50
USALLLC in the third tranche of recipients.
3:54
That set off obviously quite a lot of interest among Space Mob.
3:59
And Pan Man as usual was lifting offers like crazy, buying stock
4:04
as fast as he could and proved to be a a prescient buy because
4:09
the next day ASTS put out a press release confirming that
4:14
they were part of the MDA Shield project.
4:16
And then if there is any doubt about that, Scott came out and
4:21
specifically tweeted Golden Dome indefinite quantity contract.
4:28
So we're in and that is exciting news, but we don't know is the
4:37
scope of the contract and really kind of what it will look like
4:42
from here. And so I I was talking to Npan
4:45
man that Thursday night, kind of wondering, you know, first of
4:48
all, the socket just ripped whatever it was 10% on on
4:51
Thursday. Figured I wonder if that was the
4:54
move. I wonder if you know, people
4:56
knew and you know, now shorts are going to see this and
5:00
obviously just have their eyeballs pop out.
5:03
And so I thought that they were going to come attacking this
5:05
thing like crazy thinking, you know, we'll, they were just on
5:10
this list. They didn't get, they didn't get
5:12
a dollar amount. And we we don't know what
5:13
they're doing. So this is the final blow off
5:17
top move and, and now we can go after it.
5:20
So I was pleasantly surprised to see the stock RIP further on
5:23
Friday. And, you know, it moved $8
5:26
billion. I think of market cap kind of
5:30
in, in, in fast sort of fashion. And when you think about it, I,
5:35
I personally believe that this type of military contract is
5:39
about a billion dollar deal. And so for the market to value
5:42
that at 8 times revenue isn't, isn't really crazy to me.
5:47
And so, you know, never want to call the market moves rational
5:51
because I know it's down, stocks down overnight and we'll
5:53
ultimately talk about that. But you know, the market kind
5:56
of, you know, sees the news and actually prices in something
5:59
that struck me as quite, quite rational.
6:02
I know the shorts are going to disagree with me vehemently on
6:04
that, but I've done my work. And I believe that a contract
6:08
like this is at least, you know, at least a billion dollar type
6:11
of deal ultimately, if if we're right on all the other things.
6:15
And So what did they do? It's useful to always turn to
6:20
Katzie here and he does a deep dive on this.
6:23
And so specifically, the MDA released its third tranche of
6:27
shield contracts and it's really the license to hunt.
6:32
And that's the key thing. And so we didn't get quote UN
6:36
quote, we can get Golden Dome. What we did is we got picked to
6:40
get Golden Dome. And so Katzie's convinced that
6:45
because we're 1/3 tranche, that means that we went through some
6:47
deep vetting of our capabilities.
6:50
Tough for you who's been really on top of this for quite some
6:56
time, really kind of made the point that a lot of the
6:59
commodity providers could be in those first allocations quickly.
7:02
But then the real hardcore more, you know, unique and of one type
7:08
things were going to be in the later tranches and that sure
7:10
enough exactly what happened. And we've seen quite a lot of
7:15
evidence in these ITU filings about how this business might
7:19
take shape. And so we have different
7:22
inclinations that started to show up in our orbital operating
7:27
plan. And so we had some sun
7:29
synchronous orbit shells put up. You wouldn't need those for a
7:34
commercial service. And then we have these
7:37
satellites that are flying at lower altitudes and staggered
7:40
altitudes, which start to look a lot like they're providing PNT
7:45
type applications which are for position navigation and
7:50
tracking. And now I think a lot of us have
7:52
concluded that TS will have a role in this on the transport
7:57
layer, which is moving all the data around in space, and then
8:01
on the custody layer, which is once an asset has been
8:04
identified, making sure that you keep track of it.
8:07
And so if you find a, you know, mobile missile launcher, you
8:10
know, those guys can drive away, make sure you follow them.
8:14
And so, and I'm sure that there's many, many other use
8:16
cases, but there is a lot of really exciting things that that
8:23
will follow from this contract in our belief.
8:27
So just adding some more analysis from other people.
8:31
We have S&J investments put out a cool, you know, it's frankly,
8:35
it's AI slop, but it just helps people really understand because
8:41
it's, it's fair to say that when a contract is put out and
8:45
there's, you know, 1000 vendors on it and a lot of guys making
8:48
kind of nuts and bolts and, you know, portable toilet
8:51
manufacturers, you know, it's easy as the shorts kind of said,
8:54
well, what a, what a group of companies you got right here.
8:58
And I think one guy said sort of condescendingly then, you know,
9:05
you know, they'll, they'll find out.
9:06
But the AI model sees right through it.
9:12
And so they see that Asts got a hunting license to go after and
9:16
share in the $151 billion funding pool.
9:18
It gives them the ability to skip 18 month procurement cycle
9:22
so they can get rapid contract awards.
9:26
It officially designates the company as a critical dual use
9:29
infrastructure. And that's the key point.
9:30
And Payman and I were talking about that too.
9:32
This really well, this is a good example of where you can know
9:36
too much and then you take too many things for granted and you
9:40
actually are a little bit deaf to key junctures in the
9:47
narrative of a stock. I would fall firmly in this
9:50
category of I've come to believe so many things in such a closely
9:58
held way that when they happen, I'm almost well, I'm not
10:02
surprised when they got Golden Dome.
10:04
I was not surprised I didn't go out and buy shares after the
10:08
market. I thought, well, this is so
10:10
obvious that they were going to get Golden Dome.
10:12
How? How could this possibly be news
10:13
to anyone? And that's really the wrong way
10:16
to think about it. That is, that is coming from
10:18
someone who is too close, who has such certainty in their
10:23
understanding of the future, to not be surprised by Seminole
10:27
events a company announces. And as Anpan Man said, it really
10:30
pains me to actually compliment Anpan Man.
10:32
So we might have to end the spaces shortly, but I do have to
10:38
be honest. And so he pointed out, well,
10:42
this this is the official juncture where all of the non
10:47
communication use case stuff that we talked about and for
10:52
which we get called the clueless cult and be called the clueless
10:55
clovers and all these other things.
10:57
This is the ultimate validation of that dual use revenue model.
11:05
So to anyone on the sideline, that's a material de risking
11:09
event and it opens up an entirely new stream of the total
11:14
addressable market. Hard for me to believe why
11:17
someone wouldn't have believed that in the beginning.
11:19
You have Star Shield, for example, proving by way of
11:22
SpaceX just how big that opportunity is.
11:25
And the company for the past, I don't know, 6-7 quarters has
11:28
talked about all their government work.
11:30
They have the DIU award, they were awarded Halo and things
11:34
like that. But you know, people were still
11:39
skeptical. And so I think that that's
11:41
that's an important part about it, but it's not the only part
11:46
of it. And so while Golden Dome is
11:48
certainly a big headline, largest missile defense program
11:53
ever. And and frankly, say what you
11:55
will, you know, sorry, Peter Landmark, but we're going to
11:58
take Greenland. You know, you and your boys and
12:01
Liechtenstein are welcome to come visit, but these missile
12:04
defense technologies go hand in hand with Greenland because
12:08
that's where the missiles come from.
12:09
Not Greenland itself, but they fly over.
12:11
And so This is why Trump is going after Greenland is because
12:14
the the Poles, not not the good people of Poland, but the Poles
12:20
as in where polar bears live, that's where the missiles will
12:24
fly over. That's the flight route from
12:26
Russia over Canada into the US. And so a lot of this
12:31
infrastructure related to Golden Dome is going to be deployed in
12:36
the Arctic Regents. And so anyway, just, you know,
12:42
cancel your vacation plans to Greenland if you intended it to
12:45
be a, a, a Danish vacation is probably the right call.
12:48
But it is not the only program, even though it is the most
12:51
exciting. 1 And so we have the Spectator, who's a prolific
12:55
contributor, just pointing out some Fairwinds posts, which
13:01
again, talk about all of the different ways they're working
13:05
with AST Space Mobile. So there's one that's mentioning
13:07
the US Armed Services, the Space Force, the Air Force, the Army,
13:10
the Navy, and they talk about the militarized AST broadband
13:15
devices and AST tactical hub systems.
13:18
It gets really exciting to think about all this, for one, just in
13:23
terms of the innovation that's being made available to our
13:26
Armed Services. But secondly, then the
13:29
commercial implications of when you offer life saving technology
13:36
to support the war fighter. So, you know, the industrial
13:39
military complex is full of little loot boxes when you
13:43
actually, you know, do some good stuff.
13:46
And not least of which is the MDA Noble contract.
13:50
And so Noble stands for nimble options for buying layered
13:54
effects. It's always incredible to me to
13:57
think about how much time people on Capitol Hill think about
14:02
acronyms that stand for things. It it's truly a scale.
14:07
And I can only imagine that AI has really blown open the door
14:09
in terms of them coming up with super interesting names for
14:12
things. But the big deal, which Golden
14:17
Dome is thought to also be, is this noble contract.
14:21
And so it's not a single contract, but instead it's
14:24
really a flexible acquisition vehicle to allow the government
14:28
to buy your stuff quickly. And it apps as a wrapper so that
14:34
all of a sudden you can just sell a lot of your technology
14:37
into the government. Some people like Kevin Chen and
14:41
others have really been focused on the noble contract and
14:46
opportunity. It's something that, frankly, I
14:48
probably haven't spent as much time on.
14:50
It's not included in the DD doc. My oversight shows that there's
14:54
always room for improvement, but this is really something that
15:01
could blow the door open in terms of size.
15:04
And so and Pan man, just, you know, put out a a tweet with the
15:08
Cerberus dogs on top of the globe.
15:10
And it is a open invitation. So it could happen at any time
15:17
and could also increase the application of our technology to
15:20
some other types of use cases. Again, mostly non communication.
15:26
So we have a lot of deals seemingly coming our way, but
15:29
are we going to have the ability to build out for the government?
15:32
So luckily Space Mob never sleeps and we have our
15:36
operatives around the globe, but specifically in Florida.
15:40
And so Florida Salty Man, which is his handle was doing some
15:46
reconnaissance, frankly driving by probably on his way to
15:48
Dunkin' Donuts to Homestead, FL and noted that is no longer a
15:54
pasture and posted some pictures of the building where ASTS will
15:59
increase its satellite production in Homestead, FL,
16:02
which is on a military base. And we believe that this is
16:06
going to be capacity for some of these government applications.
16:09
Not totally clear how all of this splits out 'cause they're
16:12
also adding some capacity in Midland.
16:15
They're adding a building in Midland specifically for special
16:19
types of arrays. The way Scott took about talked
16:21
about this on a call led me to believe that this was for Golden
16:25
Dome focused arrays, which might have some differences versus the
16:29
typical communication satellite arrays.
16:32
But that's just speculation on my part, don't really know.
16:36
But more broadly, taking a step back, we're really on the cusp
16:39
of a a very exciting secular trend and this is something I've
16:44
always hoped to get right. Had it never really been early
16:49
early to a secular trend in size, even though I've certainly
16:54
studied them to make sure I understood what happened as a
16:58
post mortem. But in so doing, we really was
17:01
always a goal of mine to nail a big mega trend early.
17:06
And so for example, seeing the rise of like social media in the
17:10
in the mid 2000s would have been a good example.
17:13
Seeing the rise of SAS companies would have been a good example.
17:16
Seeing the crypto, you know, back in the early 2010, seeing
17:20
that that would become, you know, bona fide replacement of
17:24
gold, that that's a good example of a massive secular trend.
17:29
It's kind of frankly hard to spot them sort of in the early
17:33
beginning and in the middle, you're kind of in denial because
17:35
you're so mad at yourself for missing it.
17:36
You you don't do anything, even though it's probably still a
17:39
good time to to jump in. But the, the kind of space 2
17:45
point O is certainly a secular trend that I decided to plant my
17:49
flag on. And you can just see as we see
17:53
this unfold, space is quickly going from this sort of niche,
17:56
you know, nerdy type of thing where it's, oh, like the space
17:59
Bros are talking about the little space stock.
18:02
You're seeing that the world's governments are very quickly
18:05
rallying behind the importance and strategic nature of this
18:08
technology. We're seeing just that Starling,
18:13
frankly, is providing the tipping point between the light
18:17
and the darkness. We saw what happened when Iran
18:20
turned out the lights. They just started killing
18:23
everyone. And so Elon's trying to get
18:26
starlings into Iran Because when you have citizen journalists
18:30
showing kill zones being set up to murder citizens, that that
18:37
that has consequences. And when you turn off the
18:40
lights, horrible things can happen without necessarily the
18:44
type of accountability that one might expect.
18:47
And so you're, you're seeing this proliferation of, of
18:51
Starlink, which is just frankly remarkable that they have 10
18:54
million subscribers at this point and growing very quickly.
18:57
But then governments are, are jumping on whether it's missile
19:01
defense, whether it's backup GPS, whether it's resilient
19:05
communications where you had Europe the other day had service
19:09
get knocked out, you had Verizon get knocked out.
19:13
The world grinds to a halt when our mobile networks go down,
19:18
even when our terrestrial networks go down.
19:20
And so the current applications of this technology are many and
19:26
massive. But then as these technologies
19:29
are out, I continue to believe that as a platform, new
19:33
applications will be invented. And that's the most exciting
19:38
thing to me is identifying a platform that then can have user
19:43
generated content. That's, you know, taking an
19:46
example, someone could have dismissed Roblox as a video
19:49
game, but what they would have missed is it wasn't a linear
19:55
video game. It was a user generated content
19:58
platform for which then the creativity of the world
20:01
unconstrained could make cool stuff on your platform and grow
20:05
in ways that you could ever possibly do from a central
20:09
command and control type of way. That's what I'm really hoping
20:11
happens with Asts and we have. They're really just seeing this
20:16
at the forefront space, the militarization of space,
20:20
electronic warfare coming to the front.
20:22
These are the types of megatrends that are something
20:26
we're very exposed to. And that's what's going to
20:28
create a ever expanding Tam to deliver into.
20:31
And so if you're a dominant company with scalable
20:35
technology, you're just sitting up, sitting there with your
20:38
little Easter basket picking up all the eggs.
20:41
And that's the type of thing that what I've seen is when you
20:45
have a very difficult time assessing the size of that
20:47
opportunity. And so it was something I
20:49
tweeted about today. It was something from Steve
20:52
Mandel from Lone Pine. So a really great growth
20:54
investor. And he really mirrors, you know,
20:57
something I saw on my own kind of journey in investing is when
21:00
I started out, it was all about finding, you know, stocks at,
21:04
you know, negative enterprise values or training at four times
21:06
earnings and stuff like that. And a lot of times you'd see
21:09
these growth companies, you know, take Google for example,
21:12
right after IP owed and people will go, Oh my God, it's so
21:16
crazy. It's at 30 times earnings.
21:18
When you look back at it, anyone that anyone that bought Google
21:22
back then was is paying probably like point O one times earnings
21:27
at this point. Because the thing people missed
21:28
is, yeah, sure, at that exact moment, it was at 30 times
21:31
earnings. But the gross growth prospects
21:33
of that earnings were beyond human comprehension.
21:38
And so it actually ended up becoming the cheapest, one of
21:41
the cheapest stocks ever. And the key thing to, you know,
21:45
the same thing with NVIDIA, you know, the the list goes on.
21:48
Anything that can grow in a non linear rate is almost a fact,
21:51
though going to be misunderstood by Wall Street.
21:54
That's just sort of like a kook observation.
21:58
And Steve Mandel made that point of, you know, I really reward my
22:02
analysts when they show me why a company of 40 times earnings is
22:05
cheap, not the one at at four times earnings.
22:08
And one way to kind of bolster the probabilities of being right
22:14
in that respect is to find the most dynamic and expanding
22:18
markets, because it usually means that incumbents aren't
22:20
there because they would have previously thought, oh, it's a
22:22
small market. Well, we're not going to deal
22:23
with that. And then it's left for some
22:26
quote UN quote niche guys to dominate.
22:28
But then when the market flips and becomes massive, they're
22:32
they're the incumbent. And so then all of a sudden it's
22:34
very difficult for other people to catch up.
22:36
Take something like Coinbase, for example, someone could have
22:39
said, and I, I haven't really looked in depth at Coinbase, but
22:41
so this analogy might might not totally be right, but just hang
22:45
with me is, you know, you could have made the argument, I'll
22:48
interact with brokers and E*Trade and stuff.
22:50
They're just going to crush them if crypto becomes a thing.
22:53
Well, Coinbase just became so ingrained in the in the
22:56
psychology of crypto investors and became the go to name the
22:59
very difficult to displace. Same to with things like Robin
23:03
Hood in terms of the rise of really, you know, rapid retail
23:07
trading. And so you really want to find
23:12
these early market share leaders because the incumbents can tend
23:14
to have a very difficult time responding and displacing them.
23:18
They don't have the the people and they're not as nimble.
23:22
So it's something that comes up a lot with the AST short thesis.
23:26
It's well, if it's so great, why does an AT&D AT&T do it?
23:30
OK, you know, show me where AT&T has 400R FPHDS.
23:35
They don't have it in the tower companies.
23:40
Oh, they'll just do it. Well, OK, these guys are like in
23:43
the Christmas tree business. They hang poles and then they
23:47
put some radios on them. They're just putting ornaments
23:49
on a tree. So you think they're going to
23:51
space tomorrow? If they hadn't built their
23:53
business around it and their dividend companies, where, where
23:55
do you think they've had the billion dollars of R&D that
23:58
their shareholders have let them spend, which would have crushed
24:00
their dividend? Not happening.
24:03
And so sometimes the competitive response that people sort of
24:05
generically expect when they do 5-5 minutes of due diligence
24:09
simply isn't there. And we're even seeing with
24:11
SpaceX, people go, oh, there, SpaceX is just going to crush
24:14
AST space mobile how, you know, certainly a formidable
24:18
competitor, but you know, they were really set up for doing
24:21
something different. And their ability to pivot is
24:24
certainly 100 times more credible than that of AT&T or
24:30
one of the tower companies. But I think people can generally
24:33
overestimate the ability for someone in a different lane to
24:38
drive across a freeway and go in a different direction.
24:41
There's a lot of inertia that prevents that.
24:45
And there's a lot of inertia that allows an early market
24:48
share leader to grow with a defensible position.
24:52
At least that's my my belief in my bet.
24:55
But it requires execution. So luckily we got an update on
24:59
the FCC filings from ASTS that they are currently producing
25:05
satellites at a rate of 6 per month, which is which is great
25:09
news, though it is my belief that they are launch constrained
25:16
right now. And so I, as I've said before,
25:19
constellation Constipation, I believe that on these early
25:22
satellites, as they are finally getting to a sustained cadence
25:26
of producing, now they have to just match those up with launch
25:30
vehicles. Once they start getting synced,
25:34
it's just gonna, it's just gonna flow and we won't have these
25:38
sort of painful sort of periods of uncertainty.
25:41
Right now, we're at the peak annoyance point where we largely
25:46
believe and expect them to be producing lots of satellites.
25:49
They say to that point, we are currently producing
25:52
approximately 6 satellites a month from our Midland facility.
25:56
And so they're doing it. But then the market goes well,
25:59
where are they? And at the same time, ASTS just
26:03
can't put out some things because of Ndas with with launch
26:07
providers. And also sometimes the launch
26:09
vehicle is a little uncertain to pin down as well.
26:13
Like we don't know exactly when New Glenn will fly, but once we
26:17
get to May and June, we're going to be in a different cadence and
26:20
that's going to be pretty awesome.
26:22
So anyone granted the stock's at all time high, so it's not
26:25
really asking anyone to hang on for dear life right now.
26:27
But just keep in mind just how much fundamental milestone
26:32
distance you can travel in three to six months, because I do
26:35
believe that in in three to six months we're going to be in
26:38
somewhat of a remarkable place. Now what does that mean for the
26:42
share price? I don't know because the share
26:44
price is certainly discounting something and I tend to believe
26:49
that the stock market doesn't do a great job of discounting.
26:52
I've certainly been hurt myself by assuming the market will look
26:56
forward and in my experience, many times it sort of will just
27:03
look directly out the windshield while also keeping maybe 60% of
27:08
their focus on the rearview mirror as opposed to looking far
27:14
along the horizon. That will change at some point.
27:16
My belief is that once we're comfortably hitting launch
27:21
cadence, my my belief is then people would finally get it and
27:26
put it together. So once we're hitting a launch
27:28
cadence, once we have a sense of what the ARPU is going to be,
27:30
again, a big point of the short thesis that we can't disprove.
27:33
Frankly, that's all it happens. You can have a view which is
27:35
different from the short thesis, that's fine.
27:38
But you can't really argue about something that you that hasn't
27:41
happened yet once you have defined monetization and you're
27:46
into the belly of putting up the constellation.
27:48
My belief was that a long time ago, my belief was and my belief
27:52
currently is that the market at some point could end up just
27:56
racing ahead and discounting some quote UN quote silly
28:00
perspective of the future, which I don't really know what silly
28:02
means. But we can look at the Deutsche
28:04
Bank estimates for this company which come out to like a $700.00
28:08
share price. It's entirely plausible once you
28:10
start really knocking down some of these last variables and they
28:14
become unless variables as in the company will continue to go
28:19
on this track and be doing $40 billion of revenue unless people
28:23
no longer want to use their cell phone.
28:25
That's an unless statement as opposed to right now the company
28:28
can do $40 billion of revenue if the ARPU is X dollars.
28:32
And if we have this many users and if they can deliver the
28:36
constellation, we're going to be quickly shifting those if
28:39
statements to unless statements. And that's where the real
28:42
catapult on the share price happens.
28:44
And we've already seen that to extent the fact that the stock
28:47
price went from call it the prior range was like 40 or
28:51
something to now 100. It is the market telling you
28:55
that some if statements have now been de risked to unless
28:59
statements. So it's a very exciting thing to
29:02
be able to talk about these intellectual frameworks, but
29:05
unlike a professor, actually come down with the ball in the
29:09
end zone in a way that matters. So that is exciting.
29:14
But you know, it's kind of funny is what is the probability of
29:18
ASTS doing all this stuff? And literally, as they announced
29:22
the Golden Dome contract, Elon Musk turns off X and Morgan
29:27
Stanley comes out with a industry report on the space
29:30
sector and leaves ASTS out. Call me a cynic but I view this
29:37
as a deliberate silencing of the company.
29:41
Elon is doing whatever he can do muffle this company.
29:44
So whether the X outage in particular, you could say Kuke's
29:47
lost his mind. But the Ms. Morgan Stanley
29:51
exclusion I would bet my life on is Elon saying thou shall not
29:56
cover AST space mobile if the would like to be in the SpaceX
30:00
IPO. The silence from some certain
30:03
banks is deafening and those exact same banks are well known
30:07
to have partnerships with Elon and are going to be on the lead
30:10
left of a SpaceX IPO. So quite funny.
30:13
As if that will stop the space mob.
30:15
It will not, but that's what's happening.
30:17
In case anyone has any doubt, these banks are going after the
30:20
SpaceX IPO business and they are not going to pump AST space
30:23
mobile and piss off Elon and from that.
30:27
But good news is the FCC doesn't care about Morgan Stanley and so
30:33
they continue to meet with the company and are seemingly
30:38
getting pretty close to getting the SCS approval.
30:43
So the market access for the US for the constellation approved
30:48
that will be a important of that.
30:50
We are currently doing this through St. as but to end up
30:55
with the broad regulatory approval which by the way will
30:58
happen. This is another one where very,
31:01
very confident at once again betting in Pan man's life that
31:04
we will get FCC approval or we will sacrifice in Pan Man.
31:09
This is going to happen. When it happens.
31:14
I don't know what the stock price will be or what the
31:17
reaction will be. But anyone that's thinking like
31:19
an owner, such as myself, this is a fundamental event where we
31:23
would certainly celebrate with doing some, you know, buckwheat,
31:27
grass shots or something else very healthy and exciting.
31:30
And you have to think like an owner.
31:33
Fundamental events start to solidify your values.
31:36
And that's another kind of interesting thing to think of is
31:39
that a lot of people look at a stock price like Asts.
31:41
Certainly the way my wife looks at it is like, Oh my God, it
31:45
went up a lot. Whatever goes up can go down.
31:47
And so, like this entire weekend, all I heard is, well,
31:50
Cook. You know what?
31:52
She didn't talk like Sean Penn. But let's pretend she was
31:55
talking like Sean Penn. Oh, you know, Cook, oh, your
31:59
market. Oh, your money's still in the
32:01
market. So it's not, it's not secure.
32:04
And so we can't do anything because your money is not
32:06
secure. And I'm thinking whatever, you
32:11
know, we just had some fundamental events.
32:13
So my my value as an owner got more secure on Friday because
32:18
now I know for sure we are approved to participate in
32:21
Golden Dome. The value of my ownership stake
32:25
in this company as a partner of the company went up.
32:28
And that's an important way to think as an owner because you're
32:31
ultimately long the terminal value of this company.
32:33
In the interim, you're long what the pumpers will pump and what
32:37
the fudders will FUD. So your upside are the pumps,
32:40
your downside is the FUD. The ultimate value you have is
32:44
what this thing's actually worth.
32:46
And that's how Scott and a Bell have to think because they can't
32:48
pump and dump. They actually have to make this
32:50
thing worth a lot, which means they actually have to do things
32:53
that create value. And so getting that Golden Dome
32:59
award be on the contract list, that's real value.
33:01
Getting the FCC approval for the broad constellation, that's real
33:04
value. People would pay a lot of money
33:07
to buy this company simply because those regulatory
33:10
approvals are in place. Now, would they pay $50 billion
33:13
for a failed constellation that had regulatory approval?
33:16
No. But they would probably pay a
33:17
billion. And I don't want to think about
33:21
that price anymore. But these things do have value
33:24
and you are having to make sure you measure the fundamental
33:29
improvements and changes in your investment so that you realize
33:32
just cause the stock goes up, the ultimate value of the
33:36
company might have gone up as well.
33:38
And so you might still have the same remaining upside.
33:41
Surprisingly, despite the fact that the stock went up.
33:45
Another thing that is rapidly changing, presumably to our
33:49
benefit is just the change in the EU.
33:53
And so as someone who I readily admit, and I'm trying to figure
33:58
out how to not do this as much, but anyone that uses Twitter, I
34:02
think is undergoing A psyop from Elon because I noticed it in
34:07
myself. Like it really gets me depressed
34:09
because I feel like the Western world is collapsing on me and
34:12
that there's, you know, no hope. But I think that that's kind of
34:15
the desired effect of the algo. And certainly from an American's
34:20
perspective, it looks like the EU is falling apart.
34:23
It looks like sort of Constantinople is is lost based
34:27
on the news flow that they would have us read and and certain
34:31
things like that. Having said that, the EU is now
34:35
very skeptical. The one thing I do believe is
34:37
the EU is very skeptical over having reliance on SpaceX for
34:42
various obvious, obvious reasons.
34:44
And so the things that were coming out this week again, are
34:49
just the scepticism of allowing Elon to get access to this two
34:53
gigahertz band in the EU providing mobile services that
34:56
are currently being used by ViaSat and Echostar, which will
35:00
expire next year. And there's a new allocation
35:02
process. And they're going to want to
35:03
make sure they have services they can rely on.
35:06
Our belief is that SpaceX won't get those and that Vodafone
35:12
through the SAT Co JV, which is legally as European as European
35:17
could be, is in a prime position to get those things.
35:20
Now there's the only thing I worry about is with the
35:23
Greenland stuff happening, there might be a point where the
35:28
European US relationship just gets so balkanized that, you
35:36
know, I, I don't know what could happen, but I do what I do like
35:40
is that in as far as AUS based company can create a European
35:45
controlled entity for this business, I feel like ASTS has
35:47
done the best effort you can do, which should put them in an
35:51
incredible position to serve the EU market with Vodafone.
35:55
And as those sensitivities become more and more acute, I
36:00
believe that that just hurts SpaceX more and more.
36:05
And what this comes to for me is a big idea.
36:09
And so I not only do I want to invest behind an incipient
36:14
secular trend to just ton it, spike the football and do the
36:19
icky shuffle, which is really all I want to do to to do that
36:24
sequence of events. I need to also be right that
36:27
there is a company thinking big and thinking aggressively.
36:32
I was having this debate with King Tut and he was of the mind
36:39
like, well, these guys should be buying things like the, you
36:41
know, cloud, star cloud, things like that.
36:43
And maybe he's right. King Tut certainly is a, is a
36:47
very, very smart individual. But my view is don't get
36:50
distracted. Don't go start buying random
36:52
stuff. Buy things that increase your
36:53
strategic importance and your reach and your defensibility.
36:57
And so for me, I could see I'm not sold on this, but I could
37:00
see logic why Asts would want to take over a radium immediately.
37:04
You'd get a billion dollar book of government business, which
37:06
you can then upsell much improved services on.
37:10
You're buying all those contracts that are in place
37:12
transition their constellation, just let it de orbit onto onto
37:16
your constellation. So you save and you know the
37:18
margins on that Iridium current business would be through the
37:23
roof because it's all found value on ASTSS constellation.
37:27
And then you also pick up I believe 12 megahertz of global
37:31
spectrum, you know, really for peanuts at this point you
37:34
wouldn't even notice the dilution if you're an AST
37:36
shareholder. So that to me is an idea of
37:39
potentially thinking big. But the ASTS Satco venture is
37:43
another example of thinking big. They're, they're in a position
37:45
to get gold in the form of the spectrum allocation and to serve
37:52
a, a market that's bigger than the US.
37:55
The way they've been aggressive at positioning themselves this
37:57
way to me is consistent with a company that is thinking big.
38:02
And when I say big, I mean a trillion dollar market cap big.
38:06
And when I say that, I don't mean they'll necessarily hit it.
38:09
It's, it's hard to predict those things, but you can tell when
38:13
it, when you have a company that is in empire mode, not thinking
38:18
small, not playing small ball, but being strategic and swinging
38:22
the bat. If you don't have someone that
38:25
does that, then the probability of actually achieving a big idea
38:28
is pretty low. It's hard to stumble into it.
38:31
And alternatively, when you have a management team that is going
38:35
for it and swinging the bat doesn't mean they're going to do
38:38
it, but at least your probability shifts from slightly
38:41
above 0 to something that's much, much higher.
38:44
And that's what positions you to have a potential generational
38:46
company, which to me is defined in that 500 billion to a
38:50
trillion dollar type market cap range.
38:53
And it's exciting to see that SpaceX is proving that this is
38:56
possible in space. And frankly, Jeff Bezos had said
39:00
the same thing in that interview he gave a while back.
39:03
He thinks this is the next multi trillion dollar market.
39:06
And a lot of people laughed at him saying, well, OK, book boy.
39:09
How do you fathom that? And it's like, well, OK, but
39:12
literally this is the book boy guy that figured out how to
39:14
create multiple trillion dollar outcomes selling books on the
39:18
Internet. And then, you know, did a couple
39:21
Tam expansions along the way with little things like AWS.
39:24
So when this guy says he sees a big market, I think you give, I
39:28
think you gave, you know, him the benefit of the doubt.
39:31
And I'm seeing Abell think this way, which is really important
39:36
to me. And then obviously, as Ampam Man
39:38
pointed out this week, when you look at the insider sale
39:41
transactions, you just don't see them.
39:44
So this is a guy who is Yolo in this thing from 2 to 120 and all
39:49
the guy did was a prepaid forward and on basically nothing
39:53
of his own shareholdings. And even with that, he couldn't
39:56
give up the ghost and he rolled it forward to prevent having his
39:59
shares called away from him. This is a guy who is long.
40:05
He doesn't take a salary and so he is the definition of all in.
40:09
You should join the podcast at this point and think he's
40:10
qualified and we also this week. Not totally sure on this, but
40:18
Mickey Mikutani left the ASTS board.
40:22
Fudsters of course were were quick to pounce on this.
40:26
But from my own perspective as someone on boards, when you have
40:29
a strategic that's not always great.
40:33
And so when you have an MNO on your board, there's a lot of
40:36
things you're talking about in terms of commercial strategy
40:39
that is inappropriate for a board member who is your
40:43
customer, who is in a commercially opposing stance as
40:50
you to necessarily participate in those discussions, then have
40:54
a vote on what's going on, even though they're super voting
40:58
chairs. And so in my experience, I'm on
41:00
a board where we have two pretty 2 massive cap public companies
41:07
that everyone in this call would have heard of.
41:09
And they, it's awkward. There are a lot of things we're
41:14
doing at this company that sometimes we, we really don't
41:16
want those boards board members to know.
41:20
And so at the soonest opportunity, you, you want to
41:22
sometimes get them off your board and that's determined by
41:25
your shareholder rights. And so Rakuten finally doesn't
41:29
hold a sufficient number of shares.
41:31
And this, this shows up and what's called an investor rights
41:34
agreement, an IRA. And so when I negotiate these
41:37
things, you're negotiating to keep your board seat so long as
41:40
you hold a certain amount of your shares.
41:42
Usually it's, you know, the deals I do, it's hold at least
41:45
half of the shares you bought and around they're not actually
41:49
triggered from memory off ownership stake as a percent
41:53
because the, you know, private companies just don't.
41:56
That's just how, how investor rights agreements are
41:59
structured. But for the public company, that
42:01
does make sense. And so with the ATM, with the
42:04
conversion of the converts and things like that, Racketon
42:08
finally lost the right to a board seat.
42:10
Now, if you're AST Space Mobile, you're not going to extend that
42:14
privilege to Racketon when it is no longer a contractual right
42:18
they own. There is very few reasons to
42:20
have an MNO on your board if you otherwise could not have them on
42:25
your board because again, they're not necessarily your
42:27
friend. They're certainly useful
42:30
partners, but AST Space Mobile could have a lot of reasons to
42:33
want to have the other Japanese MN OS as customers, which would
42:37
be bad for Rakuten. So I don't know if anyone really
42:40
got all huffy and puffy about this but but to me this is just
42:44
simple board dynamics and and it would make sense.
42:48
If I were on the ASTS board as an independent, I would
42:51
certainly be wanting to take Rakuten from a full board member
42:56
position to an observer, which is their entitlement.
42:59
And the last tweet was just about a bell just being so
43:03
locked in and, you know, going for it.
43:07
And so we have a true owner operator of this company then
43:10
that's something that I'm certainly very aware of.
43:16
And so a, a large part of my investment is just having faith
43:20
in this individual. And faith is really defined by
43:24
me in terms of his actions. And so the way he does not milk
43:29
the company for for economics, he's not stripping the company
43:32
through big salaries, a very modest option grant he finally
43:38
took. And the fact that he's keeping
43:40
all of his shares is really telling us and signaling to us
43:44
in the strongest possible way that well, of course, like any
43:47
individual, he could be wrong. He believes based on what he
43:51
sees and he's being a consummate owner operator, so next week
43:57
should be fun. We obviously had quite a
44:00
January, a lot of other stocks had quite a January.
44:05
And it's always a question of when the market's going to
44:07
correct and cool off. And sometimes you hope the
44:10
answer is never. But like most things, sometimes
44:13
the macro just catches people when they get just a little bit
44:16
too long and it whips, whips people back and we get sort of
44:21
some healthy corrections. And it looks like right now
44:23
that's what we have in store for at least the next week, driven
44:26
by Greenland ironically. And so taking Greenland, I've, I
44:32
believe is actually probably positive for SD Space Mobile
44:34
because it's just increased investment in missile defense
44:38
systems, which is straight to us.
44:39
But in the meantime, the direct impact of that is tariff noise
44:44
with Europe and that's enough to kind of shake the market when
44:47
otherwise you had a lot of juice going into January effect and
44:52
now you're going to have some people overextended and whip the
44:54
other way. So that's why I wanted to, even
44:58
though I just had or just got off, literally just got off an
44:59
airplane straight to catch in the fourth quarter of the
45:03
championship game. I want to make sure I do the
45:05
spaces because when we do have a correcting market, the
45:11
probability of Asts getting caught up in that is, you know,
45:14
high unless there's some news and there of course could be
45:16
that wouldn't count that out by any means.
45:18
But it is important to realize like how many times people have
45:22
been knocked out of this stock because they didn't know what
45:25
they owned. We just recently in October, we
45:28
had the stock ripped to 100 bucks and then correct the $50
45:32
and people were Hari Kari in themselves.
45:34
And then look, if they just chilled out, they'd already be
45:38
up 12% even if you top ticked it or they would have been up as of
45:41
Friday, would have been up 15 to 16% even if you top ticked it in
45:45
October. And so if you get, you know, if
45:48
you're new to this company and this is your first Kooks Weekly
45:52
and all of a sudden you're going, oh God, did I top ticket?
45:54
First of all, unclear. The Golden Dome announcement's a
45:58
pretty big deal. And you, I have no idea where
46:02
the stock price should go or could go in the near term on
46:04
this, but you really did have some exciting and fundamental
46:07
news. And then the important thing is
46:10
don't, don't get bullied out of it.
46:12
It's not to say this is guaranteed to be a good
46:14
investment. No one could possibly give that
46:15
guarantee. But what you should do is
46:17
actually try to know what you own.
46:19
This stock will for sure always be volatile.
46:22
It always seeks to impose a high price on newcomers.
46:27
There will be a point where you will be like me and be
46:29
inoculated from this, both through the number of times
46:33
you've gone through it, but also then ultimately the cost basis
46:36
of your position where you go. I don't know whatever, you know
46:41
this point. I I don't even get that bent out
46:44
of shape. You know, famous less words.
46:46
Talk to me next week if the stock is like $105 and I'm
46:49
posting like crying memes of myself and defriending and pan
46:53
man. But for now, I'm holding a
46:55
strong face. But it is important to study
46:57
what you own so that you aren't the victim of volatility.
47:01
And that's really what you know, all of us that contribute to the
47:04
space mob. I think in inherently what we're
47:07
trying to do is help people not get knocked out by volatility
47:12
and not get knocked out by FUD. And so the, the I actually love
47:16
Morgan Stanley as an investment bank, but the fact that, you
47:19
know, they're not covering them and their space initiation, the
47:22
fact that you have Scotiabank coming out with sort of BS hit
47:26
pieces on this. Then you have shorts come out
47:29
and try to scare people. But then when I invite them on
47:31
this call, invite them to do write ups and you read their
47:33
write up and maybe some people were moved by it.
47:36
I certainly read the write up buyout valuations, and I thought
47:40
it was actually humorously written.
47:43
I I mean, I kind of think it's hysterical when he's like, yeah,
47:46
you know, space mob. It's like being chased by a
47:48
bunch of meth addicted raccoons. I'm like, yeah, maybe we should
47:52
tote it down. Then I go, you know what, fuck
47:54
it. Like that's the culture.
47:56
We are a bunch of raccoons on meth that found stakes in a
48:00
garbage can. And I'm, I don't know, you just
48:02
got to like own your culture at some level.
48:04
Like you can never disavow your culture is my kind of conclusion
48:07
on this. And but the, the important
48:10
thing, which I've been trying to do is get these shorts to engage
48:14
and really figure out what they know.
48:17
So I actually know the guy from Raging Capital.
48:19
He's a good dude, worked with him many moons ago on some
48:23
things. But I, I know his mentality, I
48:25
know his mindset. And now he's, you know, 12 to 15
48:28
years older. And so he's probably gotten more
48:31
ossified and the trajectory he was on.
48:34
And that's why it's good to know like, well, what is your
48:36
perspective? And you know, he goes well, it's
48:38
it's a radium IPO 2 point O All right, yeah, as if we didn't
48:43
study that. But to someone doing 5 minutes
48:45
of DDI could see how they could come to that conclusion.
48:47
But that's an easy one to to move on from the valuations guy.
48:52
He's short. They so so is really well, these
48:55
guys might be right on all the fundamentals, in which case my
48:57
short is no longer a good short and we could just end it there
49:00
because no sooner did the guy write his write up saying, you
49:04
know, golden Dome is opium, but if it's not that's a wrist of my
49:07
short, then the company of course gets golden Dome.
49:09
So I don't know to say like it's easy to slam us when we're
49:13
pertificating about the future, but then like, OK, what if we're
49:16
right? I know it sounds preposterous
49:18
some of the things we say, but what if we're right?
49:22
What if it is just a preposterously good investment
49:25
and that's kind of like what happened here.
49:27
It's people thought we were nut jobs for thinking this thing was
49:30
going to be a legitimate market share leader and, you know, take
49:34
on take down SpaceX and become a large government contractor.
49:39
People thought we were nuts, but nutty things happen.
49:43
Microsoft exists. That's nutty.
49:46
Why did IBM let that happen? NVIDIA exists.
49:49
Why did Intel let that happen? And somebody would be like kook
49:53
exists. Why did his moment dad let that
49:55
happen? Well, you know, I don't know
49:56
longer story, but you got to know what you own.
50:00
And so just beware if we have some volatility, use it, but
50:06
don't let it abuse you. And that's all I got.
50:09
So thanks to everyone for joining me.
50:10
I'm looking forward to joining next week and already have a
50:15
bunch of tweets that I've bookmarked.
50:16
So sometimes if you write some content on ASTS and you see like
50:19
a quick bookmark, that's me, you're being monitored because
50:24
I'm constantly monitoring the situation when it comes to all
50:27
things Asts. Good night, everyone.
50:29
Thanks for joining me. Thanks for listening to the AST
50:32
Space Mobile podcast. If you enjoyed this episode and
50:36
you'd like to help support the podcast, please share it with
50:38
others, post about it on social media, or leave a rating and
50:42
review. To catch all the latest news
50:44
about AST Space Mobile, make sure to subscribe.
50:48
Thanks again and I'll see you next time.
50:53
We're doing something very, very big and I think with this
50:56
technology we can really affect billion lives.
50:59
AFT Space Global is the only company that has good technology
51:03
to deliver cellular broadband connectivity directly from state
51:08
to do everyday smartphone. People will just basically turn
51:11
their phone and be Syndex regardless of where you are.
51:14
We don't want the news for even to know that it's connected by
51:17
satellite. Our role is to bring this into
51:21
reality, always in partnership with the animal.