WEBVTT - Boeing Workers Strike, Evite's Profitability 0:00:02.920 --> 0:00:08.119 Bloomberg Audio Studios, Podcasts, radio news. 0:00:08.520 --> 0:00:12.880 This is Bloomberg business Week Inside from the reporters and 0:00:13.080 --> 0:00:16.640 editors who bring you America's most trusted business magazine, plus 0:00:16.720 --> 0:00:20.840 global business, finance and tech news. The Bloomberg Business Week 0:00:20.880 --> 0:00:25.800 Podcast with Carol Messer and Tim Stenebeck from Bloomberg Radio. 0:00:27.120 --> 0:00:29.800 Bowing also at risk of losing its investment grade credit 0:00:29.880 --> 0:00:32.720 rating is the Planemaker face is the prospect of a 0:00:32.840 --> 0:00:35.839 drawn out strike by workers that will further disrupt production 0:00:35.880 --> 0:00:38.720 and cash flow. Carol factory workers walking off the job 0:00:38.760 --> 0:00:42.240 for the first time in sixteen years. They halted manufacturing 0:00:42.240 --> 0:00:45.320 across the Seattle hub of Boeing after members of its 0:00:45.400 --> 0:00:48.599 largest union voted overwhelmingly to reject a contract offer and 0:00:48.680 --> 0:00:50.680 go on strike. I gotta tell you, George Ferguson earlier 0:00:50.680 --> 0:00:52.640 this week when you were out Yep, he said, this 0:00:52.800 --> 0:00:55.120 negotiation is by no means over at this point. 0:00:54.920 --> 0:00:56.520 All right, So that's why we wanted to check in 0:00:56.560 --> 0:00:59.320 once again with him. Bloomberg Intelligence Senior Aerospace, Defense and 0:00:59.360 --> 0:01:03.880 Airlines Alls George Ferguson does join us from New Jersey. George, 0:01:03.920 --> 0:01:07.319 First of all, we've been, you know, anticipating this, this 0:01:07.440 --> 0:01:10.679 strike long versus short How important is that? 0:01:11.400 --> 0:01:11.480 So? 0:01:11.920 --> 0:01:15.240 I think very important to Boeing. I'm sure the machinists 0:01:15.240 --> 0:01:17.160 as well, but the Boeing I think more so. Right, 0:01:17.680 --> 0:01:22.040 a long strike really, I think runs the risk of 0:01:22.160 --> 0:01:25.080 hurting the supply chain even more so, I think if 0:01:25.080 --> 0:01:27.760 boe gets into this strike, they have to really think 0:01:27.800 --> 0:01:31.080 about cash cash on their balance sheet. We think they're 0:01:31.200 --> 0:01:33.720 likely to burn three three and a half billion dollars 0:01:34.080 --> 0:01:38.199 where the cash in three q probably putting them close 0:01:38.200 --> 0:01:41.160 to about nine billion dollars of cash in the balance sheet. Wow, 0:01:41.959 --> 0:01:44.920 that's about the bottom of I think what they need 0:01:45.640 --> 0:01:48.120 to run the company. And so I think, you know, 0:01:48.440 --> 0:01:52.320 if they don't get workers back on lines building airplanes, 0:01:52.840 --> 0:01:55.640 bringing cash in the door, they'll have to go. They'll 0:01:55.640 --> 0:01:58.520 definitely have to go to the capital markets. And then 0:01:58.520 --> 0:01:59.800 they got to figure out, right they want to go 0:01:59.800 --> 0:02:03.320 to the debt markets. I think the rating aencies wouldn't 0:02:03.400 --> 0:02:05.160 like that for sure, right, that might push them into 0:02:06.080 --> 0:02:08.280 less than the investment great they do that. 0:02:09.160 --> 0:02:11.360 Equity investors never liked being diluted. 0:02:12.200 --> 0:02:15.799 So the cash position and some of those considerations mean, 0:02:16.000 --> 0:02:18.560 you know, Boeing's back is sort of really against the 0:02:18.600 --> 0:02:19.079 wall here. 0:02:19.200 --> 0:02:21.360 Well, talk to us about this Moody's. This is about 0:02:21.360 --> 0:02:24.600 two hours ago or so. Moody says Boeing. Boeing's ratings 0:02:24.639 --> 0:02:28.000 maybe cut to junk with a company that already you 0:02:28.040 --> 0:02:32.040 just walked us through the Boeing balance sheet already stressed. 0:02:32.639 --> 0:02:33.840 What would that mean if. 0:02:33.680 --> 0:02:36.600 It was cut to junk, and especially if it sounds 0:02:36.600 --> 0:02:39.000 like it could need to tap the capital markets, debt 0:02:39.040 --> 0:02:39.919 markets in particular. 0:02:40.760 --> 0:02:43.520 Yeah, So, I mean, I'm not the credit analyst ongoing, 0:02:43.639 --> 0:02:45.799 but I'll tell you that. You know, I've spent time 0:02:45.840 --> 0:02:48.839 in credit teams at Blackrock and such, so I don't 0:02:48.880 --> 0:02:50.480 know the exact spread they would get enough to go 0:02:50.480 --> 0:02:53.119 play around that, but it'll mean higher spreads, right, which 0:02:53.160 --> 0:02:57.240 mean higher interest rates for raising money at Boeing. Plus, 0:02:57.280 --> 0:03:01.120 you get into this bad game where when a company 0:03:01.160 --> 0:03:04.000 goes less than investment grade, there are some funds that 0:03:04.080 --> 0:03:06.960 can't hold less than investment great paper, right, and sometimes 0:03:08.080 --> 0:03:10.000 they'll end up having to get that, you know, put 0:03:10.040 --> 0:03:13.359 that paper on the on the market. That doesn't help 0:03:13.400 --> 0:03:16.480 prices of the debt either. So two things I think 0:03:16.520 --> 0:03:19.320 they really want to be avoiding bone What. 0:03:19.320 --> 0:03:23.680 About reputational damage here? We've talked a lot about financial damage, 0:03:23.680 --> 0:03:25.480 but what about reputational damage. I mean, at the end 0:03:25.480 --> 0:03:27.200 of the day, this is a I think it's fair 0:03:27.200 --> 0:03:30.240 to say a lot of people would call this a duopoly. George, 0:03:30.720 --> 0:03:33.400 Is the company at risk from a customer perspective at all? 0:03:33.520 --> 0:03:36.080 Or are these customers locked in because you know, Airbus 0:03:36.200 --> 0:03:38.400 is sold out of the A three twenty till the 0:03:38.480 --> 0:03:39.280 end of the decade. 0:03:40.120 --> 0:03:43.000 Yeah, I think that makes it hard right for people 0:03:43.000 --> 0:03:46.720 to move, for customers to move, you know, and we 0:03:46.800 --> 0:03:51.280 continue to watch deliveries every single month and there's still 0:03:51.280 --> 0:03:54.240 a lot of core customers. We even looked at the 0:03:54.440 --> 0:03:56.160 expected deliveries till the end of the year, and it's 0:03:56.160 --> 0:03:57.400 core customers. 0:03:56.960 --> 0:03:58.000 That are taking airplanes. 0:03:58.000 --> 0:04:02.640 It's it's Ryanair at Southwest, United Airlines, it's Alaska, it's 0:04:02.960 --> 0:04:08.040 gall out of Brazil, it's COPA out of Panama, all 0:04:08.080 --> 0:04:08.800 good airlines. 0:04:09.120 --> 0:04:12.200 I think going less than investment grade doesn't worry them. 0:04:12.720 --> 0:04:16.359 They're I think they're just watching closely to see how 0:04:16.440 --> 0:04:21.039 stable Boeing is. If they can improve manufacturing, improved quality, 0:04:21.080 --> 0:04:24.080 I think that alone will keep them coming back to Boeing. 0:04:24.120 --> 0:04:26.280 Like you said, due to the long stretch for A 0:04:26.360 --> 0:04:29.559 three twenties due to the cost of changing airplane types 0:04:29.560 --> 0:04:30.159 in those fleets. 0:04:30.160 --> 0:04:32.720 Lots of those fleets are are pure. 0:04:32.520 --> 0:04:34.960 Fleets, so you save money on by the training and 0:04:35.080 --> 0:04:38.000 save money on your maintenance pools and things like that. 0:04:38.680 --> 0:04:40.240 But I mean, I think you know this is not 0:04:40.839 --> 0:04:43.520 a road that Boeing wants to keep going down. Clearly, right, 0:04:43.520 --> 0:04:45.800 when you go less than investment grade, it means risks 0:04:45.960 --> 0:04:47.280 are rising of a default. 0:04:48.279 --> 0:04:50.640 US government probably don't see that, lees they don't want 0:04:50.640 --> 0:04:52.800 to see them. That's the challenge, right, is that you've 0:04:52.800 --> 0:04:53.880 got to stem in at some point. 0:04:54.040 --> 0:04:56.360 I'm not sure if we've showed this already to viewers 0:04:56.400 --> 0:04:59.200 and for those folks are listening on radio as well, 0:04:59.279 --> 0:05:03.040 but Boeing's revenues, we've got a chart and it just 0:05:03.120 --> 0:05:06.800 shows how they have been declining right and moving lower, 0:05:06.800 --> 0:05:09.320 and I understand the reasons why. And we're bringing up 0:05:09.360 --> 0:05:11.839 the chart and you're seeing, you know, the last couple 0:05:11.839 --> 0:05:14.279 of quarters. This is not a trend line that you 0:05:14.360 --> 0:05:17.880 want to see. It's not a healthy trend line. What 0:05:17.920 --> 0:05:20.920 does it take to turn it around at this point? 0:05:22.240 --> 0:05:25.400 Yeah, I mean, I think that they have in place 0:05:25.600 --> 0:05:27.640 what they need to turn it around, right, And that 0:05:27.880 --> 0:05:31.320 was after the Alaska door problem right there. Really needed 0:05:31.360 --> 0:05:35.520 to get the FAA comfortable that they were improving manufacturing, 0:05:35.520 --> 0:05:36.480 improving quality. 0:05:37.080 --> 0:05:37.920 You know, they're going to. 0:05:37.880 --> 0:05:41.479 Go in and buy Spirit Aerosystems, major supplier of the 0:05:41.480 --> 0:05:43.000 fuselage in the seven thirty seven. 0:05:43.240 --> 0:05:44.560 And now I should step back and say, look, the 0:05:44.560 --> 0:05:46.560 seven thirty seven is right. 0:05:46.600 --> 0:05:49.680 It's really I think the most critical component of this 0:05:49.760 --> 0:05:52.880 turnaround because that's the money maker, the profit generator at 0:05:52.880 --> 0:05:55.320 the company, and that's where they've had their problems, right 0:05:55.320 --> 0:05:57.440 and they've got a plan in place to go buy 0:05:57.600 --> 0:06:01.160 Spirit Aerosystems, and now it's a fun keeping that supply 0:06:01.320 --> 0:06:06.040 chain healthy enough and starting to increase, you know, the 0:06:06.040 --> 0:06:09.799 components they build, so Boeing can pull those into the factory, 0:06:10.240 --> 0:06:13.080 build more airplanes, push them out the door, and generate 0:06:13.520 --> 0:06:16.719 revenue and cash flow. Going is sitting though on eighty 0:06:16.720 --> 0:06:20.719 five billion dollars in inventory right now, is taking from 0:06:20.800 --> 0:06:24.239 suppliers at a thirty one rate, and they're not delivering 0:06:24.279 --> 0:06:26.640 at a thirty one rate, and that becomes the problem too. 0:06:26.680 --> 0:06:29.279 Hey, George, we only have like ten seconds left here, 0:06:29.360 --> 0:06:32.800 But back to the strike. What's the timeline that investor 0:06:32.800 --> 0:06:34.880 should understand here. How long do you think it'll take 0:06:34.920 --> 0:06:35.600 to get resolved? 0:06:36.560 --> 0:06:38.000 You know, I really think this is going to be 0:06:38.040 --> 0:06:40.520 resolved in a couple of weeks to a month. I 0:06:40.560 --> 0:06:42.960 just don't see going able to let it go on 0:06:43.080 --> 0:06:44.960 much longer than that. I think they just have to 0:06:45.120 --> 0:06:48.800 increase the salary, you know, increases, and they're going to 0:06:48.839 --> 0:06:49.080 have to. 0:06:49.680 --> 0:06:51.520 I think the union is going to want more guarantees 0:06:51.520 --> 0:06:54.080 on an airplane. The long to take the next seveneen seven. 0:06:54.279 --> 0:06:56.919 Yeah, the CFO already talking about the goal of building 0:06:56.960 --> 0:06:59.720 thirty seven thirty seven Max jets a month by year 0:06:59.720 --> 0:07:02.000 and will take longer due to the workers strike, so 0:07:02.000 --> 0:07:05.359 we know that there's already some delays. George Ferguson, thank you, 0:07:05.400 --> 0:07:07.039 Thank you as always, have a great weekend. 0:07:08.800 --> 0:07:12.320 You're listening to the Bloomberg Business Week podcast. Catch us 0:07:12.360 --> 0:07:15.600 Live weekday afternoons from two to five pm. Easter Listen 0:07:15.640 --> 0:07:17.800 on Apple car Play and then brought auto with a 0:07:17.840 --> 0:07:22.000 Bloomberg Business app or wants us Live on YouTube. 0:07:22.840 --> 0:07:26.400 In the United Airlines announcing a deal for SpaceX's Starlink 0:07:26.440 --> 0:07:28.800 to power it's in flight Wi Fi, becoming the first 0:07:28.840 --> 0:07:32.760 major US carrier to use the satellite system and giving 0:07:32.800 --> 0:07:35.680 the Elon Musk run company, a marquee customer. Now the 0:07:35.680 --> 0:07:38.360 telecom sector and how we stay connected. It really continues 0:07:38.400 --> 0:07:42.400 to evolve, gets disrupted. Which brings us to the tiny 0:07:42.480 --> 0:07:44.760 telecom company that wants to compete with SpaceX. 0:07:45.000 --> 0:07:46.120 Check this out, everybody. 0:07:46.240 --> 0:07:47.840 It has become one of the hottest stocks in the 0:07:47.840 --> 0:07:51.200 world this year after soaring from two dollars to nearly 0:07:51.600 --> 0:07:52.880 thirty dollars. 0:07:52.480 --> 0:07:55.040 In just six months. So Tim, let's get to the interview. 0:07:55.080 --> 0:07:58.360 It's up another thirteen percent as we speak today. Joining 0:07:58.400 --> 0:08:01.480 us from Boston, We've got Scott was Newski, president of 0:08:01.480 --> 0:08:04.080 the eight point one billion dollar market cap wireless telecom 0:08:04.120 --> 0:08:08.040 company AST Space Mobile, the company building a global cellular 0:08:08.160 --> 0:08:12.360 broadband network in space to operate directly with standard unmodified 0:08:12.720 --> 0:08:16.240 mobile devices. Scott, Welcome to Bloomberg Business Week. Good to 0:08:16.280 --> 0:08:19.400 have you explain for the layperson how this technology works 0:08:19.440 --> 0:08:22.520 and how it's different from typical five G technology that 0:08:22.560 --> 0:08:27.240 they'd get from a typical wireless operator that sends them 0:08:27.360 --> 0:08:28.640 the signal on the ground. 0:08:30.560 --> 0:08:32.120 Well, thank you for having us today. 0:08:32.840 --> 0:08:36.600 Our technology is space based, it's in lower forbit and 0:08:36.679 --> 0:08:39.199 it functions as a sort of replacement for a seal 0:08:39.280 --> 0:08:43.600 tower on the ground. It uses today's wireless frequencies, today's 0:08:43.600 --> 0:08:46.720 cell phones, and it's backwards compatible with the five billion 0:08:46.800 --> 0:08:50.680 plus phones that we use today around the world. 0:08:50.840 --> 0:08:52.439 So you are a user. 0:08:52.920 --> 0:08:55.079 Our partners in the US are AT and T and Verizon. 0:08:55.440 --> 0:08:57.000 If you're a customer of one of them, have a 0:08:57.000 --> 0:08:59.160 plan with them. The phone in your pocket in the 0:08:59.200 --> 0:09:03.120 future will be able to access our satellite, our satellite 0:09:03.120 --> 0:09:06.280 network in space, and so we have the technology and 0:09:06.320 --> 0:09:08.800 the patents to make that work in a way that 0:09:09.080 --> 0:09:11.760 was never contemplated before because space is so far away. 0:09:12.480 --> 0:09:13.920 But we have the technology in orbit. 0:09:13.960 --> 0:09:17.839 We just launched five satellites this week, and the size 0:09:17.840 --> 0:09:20.880 of our satellites allow us connect to regular, small, low 0:09:20.920 --> 0:09:21.880 powered cell phones. 0:09:22.160 --> 0:09:26.719 In your view, Scott, does this replace cell phone towers? 0:09:27.080 --> 0:09:29.200 Should companies like American Tower be concerned? 0:09:30.960 --> 0:09:33.160 Well, that's an excellent question when we often get but 0:09:33.240 --> 0:09:36.160 American Tower is actually invested in US twice. So we 0:09:36.720 --> 0:09:40.600 are designed to supplement cellular networks on the ground. Because 0:09:40.640 --> 0:09:44.760 of physics, terrestrial networks will always be best served people 0:09:44.800 --> 0:09:48.120 that are nearby. Our towers in the sky are over 0:09:48.120 --> 0:09:50.920 five hundred miles away, so we. 0:09:50.880 --> 0:09:52.239 Are a supplemental coverage. 0:09:52.400 --> 0:09:55.880 When your phone is quiet and has no coverage or 0:09:55.920 --> 0:09:58.360 weak coverage, that's when we come in. And it makes 0:09:58.400 --> 0:10:00.000 a lot of sense for us because we have the 0:10:00.000 --> 0:10:02.559 able to cover half the country with. 0:10:02.600 --> 0:10:03.959 Only one satellite at a time. 0:10:04.120 --> 0:10:07.920 So it's a very efficient way for operators like ATMT 0:10:08.040 --> 0:10:10.640 and Verizon and the other forty five around the world 0:10:10.679 --> 0:10:13.080 that we have agreements with, who collectively have over two 0:10:13.120 --> 0:10:15.880 point eight billion subscribers. So we're really an extension of 0:10:15.920 --> 0:10:19.240 their networks, and we were designed from the beginning to 0:10:19.320 --> 0:10:22.840 complement their networks, work with their distinct technology and work 0:10:22.880 --> 0:10:25.360 with the phone in your pocket without even. 0:10:25.160 --> 0:10:29.360 Million all right, so supplementing, complementing, But at some point 0:10:29.480 --> 0:10:32.719 couldn't be couldn't be that what you do be comprehensive. 0:10:33.080 --> 0:10:37.200 I mean, I think about Starlink, and they certainly look 0:10:37.320 --> 0:10:40.920 to seem to want to be comprehensive in terms of 0:10:40.960 --> 0:10:44.840 their capabilities. But I'm curious for you guys. You know, 0:10:44.840 --> 0:10:47.920 American Tower might be joining up with you guys just 0:10:48.000 --> 0:10:51.120 to be prepared for kind of what's next and what 0:10:51.200 --> 0:10:53.800 might be the future, rather than what they are doing currently. 0:10:55.160 --> 0:10:58.319 Yeah, it's a really interesting question, and it gets back 0:10:58.360 --> 0:11:00.400 to what the cell company is and the tower companies 0:11:00.440 --> 0:11:02.880 have created over the last couple decades, which is an 0:11:02.880 --> 0:11:07.920 incredible network that covers most of the population. There are 0:11:08.000 --> 0:11:10.040 there are spots that are missed, but today's trestrial networks 0:11:10.080 --> 0:11:12.600 are very good, so so we'll never replace that. 0:11:12.880 --> 0:11:14.240 It's just a question of physics. 0:11:14.480 --> 0:11:18.000 Our satellites are the largest ever put into lower th 0:11:18.080 --> 0:11:21.040 orbit commercially, it's over seven hundred square foot each. We've 0:11:21.040 --> 0:11:23.000 been flying one for the last two years and we 0:11:23.120 --> 0:11:26.720 just launched five more yesterday. So we are going to 0:11:26.720 --> 0:11:28.800 be able to provide a lot of coverage from a 0:11:29.360 --> 0:11:31.240 from a satellite perspective. 0:11:30.720 --> 0:11:32.000 What's a lot? What's a lot? 0:11:32.080 --> 0:11:34.760 When you think about people who are using would need 0:11:34.800 --> 0:11:39.040 to tap into the service sixty seventy percent, what's a lot? 0:11:40.559 --> 0:11:43.680 Well, we have the ability so you may be familiar 0:11:43.720 --> 0:11:46.600 with other satellite services. They're they're starting to pop up 0:11:46.600 --> 0:11:49.960 on phones today and those tend to be SOS, emergency, 0:11:50.280 --> 0:11:51.520 maybe some limited texting. 0:11:52.120 --> 0:11:53.160 We've tested four. 0:11:53.000 --> 0:11:55.560 G five G speeds to the phone over the last 0:11:55.600 --> 0:11:57.679 year and that was a big part of the technical 0:11:57.720 --> 0:12:00.640 demonstrations we did last year where our partners eighteen in 0:12:00.720 --> 0:12:03.560 Vota Phone in Europe and racketing in Japan, and so 0:12:03.559 --> 0:12:05.800 we've done over twenty megabits per second to the phone. 0:12:06.320 --> 0:12:07.319 But this is a supplement. 0:12:07.440 --> 0:12:11.760 Think about extra gigabytes to the phone, not your base package. Typically, 0:12:11.800 --> 0:12:13.640 this is an add on for when you're moving in 0:12:13.679 --> 0:12:15.959 and out of coverage as you live, work and travel, 0:12:16.360 --> 0:12:19.319 or importantly in the developing world. We have the ability 0:12:19.360 --> 0:12:21.960 to help really put a dent in the two point 0:12:22.040 --> 0:12:25.120 five billion people who don't have any cellular broadband access today. 0:12:25.200 --> 0:12:28.320 So it's really meant to be a supplement, but it 0:12:28.360 --> 0:12:30.240 is a large supplement, and that's why it's a cellular 0:12:30.280 --> 0:12:31.079 broadband network. 0:12:31.240 --> 0:12:34.240 Scott, we said, do you want to compete with SpaceX, 0:12:34.480 --> 0:12:38.880 but you also rely on SpaceX. For example, yesterday you 0:12:38.960 --> 0:12:43.840 launched five commercial satellites a top a SpaceX Falcon nine rocket. 0:12:43.880 --> 0:12:48.800 Explain your relationship with SpaceX here, and remember SpaceX owns Starlink. 0:12:48.920 --> 0:12:50.679 So that's why we're talking about this. 0:12:51.880 --> 0:12:54.160 That's right, And so what we're doing is very different 0:12:54.160 --> 0:12:57.680 from what Startling and others that this is historically done, which. 0:12:57.480 --> 0:12:58.640 Is talking to a dish. 0:12:58.880 --> 0:13:01.040 You know, we're standing up a brain new vertical within 0:13:01.080 --> 0:13:04.400 satellite telecommunications of going directly to the phone and it's 0:13:04.440 --> 0:13:06.839 all about working with the wireless carriers globally, so we're 0:13:06.880 --> 0:13:09.920 not a closed system. We work with today's standard phones, 0:13:10.000 --> 0:13:12.800 which have been standardized globally and are really incredible and 0:13:12.800 --> 0:13:15.120 we all benefit from them every day. So we're standing 0:13:15.200 --> 0:13:18.880 up a new vertical within satellite telecommunications that really looks 0:13:18.880 --> 0:13:21.400 and feels like a wireless network and to get to 0:13:21.480 --> 0:13:24.640 orbit to build that network, we're actually we're actually vertically integrated. 0:13:24.640 --> 0:13:26.960 We're based in Texas. We build our own satellites. 0:13:27.000 --> 0:13:31.400 It's an incredible core competency of ours and very very 0:13:31.400 --> 0:13:33.840 important to building any lower orbit networks. So we build 0:13:33.840 --> 0:13:37.040 our satellites ourselves, and then in terms of launching that network, 0:13:37.600 --> 0:13:40.240 we plan to work with all the major launch providers globally. 0:13:41.640 --> 0:13:44.200 What's the toughest part of what you are doing right now? 0:13:44.200 --> 0:13:46.360 Do you have enough capital to do what you need? Obviously, 0:13:46.360 --> 0:13:48.440 investors are pretty excited about what you're doing. 0:13:49.440 --> 0:13:51.760 What's the difficulties now? 0:13:51.800 --> 0:13:54.800 The unlock for us this year was really it really started. 0:13:54.480 --> 0:13:57.360 In January when we announced investment from AT and T, 0:13:57.960 --> 0:14:00.000 Vota Phone and Google, and then we follow that up 0:14:00.040 --> 0:14:03.079 with investment by Verizon in May. And so for US 0:14:04.200 --> 0:14:06.840 we're publicly traded on the Nasdaq. We've raised over one 0:14:06.840 --> 0:14:10.600 point five billion. We feel very good about our capitalization 0:14:10.840 --> 0:14:13.559 to achieve our near term objectives, and so. 0:14:13.520 --> 0:14:14.600 We feel good about capital. 0:14:14.800 --> 0:14:17.560 We feel great about the technology, with the demonstrations we've 0:14:17.559 --> 0:14:20.240 done over the last two years with our in orbit satellite. Yeah, 0:14:20.360 --> 0:14:22.760 and for us, it's really a race against time. We're 0:14:22.760 --> 0:14:25.520 building our satellite network as fast as we can, and 0:14:25.560 --> 0:14:28.280 our partners are very excited and based on the hundreds 0:14:28.280 --> 0:14:31.400 of investors who traveled to watch our launch this week 0:14:31.480 --> 0:14:34.440 at five am in the morning, they're very excited as well. 0:14:34.480 --> 0:14:37.920 I think there's a real strong latent demand for our service, 0:14:37.960 --> 0:14:39.800 and it comes from the fact that when our phone 0:14:39.920 --> 0:14:42.040 does not work, we feel very heavy. 0:14:41.800 --> 0:14:43.920 In our pocket paste and so. 0:14:43.960 --> 0:14:47.480 Super quick ten seconds. Do you go it alone? Is 0:14:47.480 --> 0:14:49.720 that the plan? Or would you be open to linking 0:14:49.800 --> 0:14:50.920 up with someone real quickly? 0:14:51.200 --> 0:14:54.400 Well, we're already partnered with many wireless operators right age, 0:14:54.480 --> 0:14:57.720 So that's all we do is we need them. 0:14:58.200 --> 0:15:00.800 All right, good, leave it there, look forward to future conversation. 0:15:00.840 --> 0:15:05.160 Scott Wazanouski, he's president, chief president of AST Space Mobile, 0:15:05.240 --> 0:15:05.720 joining us. 0:15:10.680 --> 0:15:14.520 You're listening to the Bloomberg Business Week Podcast. Listen live 0:15:14.640 --> 0:15:17.440 each weekdays starting at two pm Easter on Apple car 0:15:17.560 --> 0:15:20.520 Play and Android Auto with the Bloomberg Business App. You 0:15:20.560 --> 0:15:23.840 can also listen live on Amazon Alexa from our flagship 0:15:23.880 --> 0:15:27.680 New York station, Just say Alexa Play Bloomberg eleven thirty. 0:15:28.880 --> 0:15:30.360 All right, we knew we had to do this story, 0:15:30.400 --> 0:15:32.440 no doubt about it. It is among the most read 0:15:32.480 --> 0:15:36.360 on the Bloomberg terminal. It's also because it's someone associated 0:15:36.360 --> 0:15:39.000 with former President Donald Trump and key and Trump's thoughts 0:15:39.000 --> 0:15:41.840 when it comes to crypto. All right, we couldn't say 0:15:41.880 --> 0:15:43.840 it enough. Today we want to get to the dirt 0:15:43.880 --> 0:15:46.880 bag of the internet. We are going to ask about that. 0:15:46.880 --> 0:15:49.560 That kind of name, if you will, is the reporter 0:15:49.600 --> 0:15:51.240 who's been looking into him, writing about him. 0:15:51.320 --> 0:15:52.040 It is Zeke Fox. 0:15:52.080 --> 0:15:55.880 He's Bloomberg News Financial investigations reporter, author of Number Go Up, 0:15:55.960 --> 0:15:59.040 Inside Crypto's wild Rise and Staggering Fall. So he follows 0:15:59.080 --> 0:16:01.720 the crypto world very closely. Zeke is with us in 0:16:01.720 --> 0:16:02.400 New York City. 0:16:02.440 --> 0:16:05.120 All right, Zeke? Who is Chase Harrow or should we 0:16:05.160 --> 0:16:07.800 say Chase Hero, which is kind of it. 0:16:10.000 --> 0:16:12.000 It is pronounced hero, even though he spells it with 0:16:12.040 --> 0:16:17.120 two rs and he's the man behind World Liberty Financial, 0:16:17.200 --> 0:16:20.800 which I mean, just this in itself is kind of shocking. 0:16:21.120 --> 0:16:24.920 This is a crypto startup that the Trumps are promoting 0:16:25.720 --> 0:16:28.360 just you know, a couple of months before the election, 0:16:28.800 --> 0:16:31.720 and Donald Trump is going to unveil all the details 0:16:31.720 --> 0:16:34.360 he promises in a live stream on Monday. So I 0:16:34.400 --> 0:16:38.160 decided to dig into this business partner. And like you said, 0:16:38.680 --> 0:16:41.960 he calls himself the dirt bag of the Internet. And 0:16:41.960 --> 0:16:43.320 that's just the beginning of the story. 0:16:43.640 --> 0:16:45.960 Just what every presidential candidate wants to be connected with, 0:16:46.000 --> 0:16:47.440 the dirt bag of the Internet. 0:16:47.480 --> 0:16:50.640 Well, what do we know about Trump's connection to this? 0:16:50.960 --> 0:16:53.160 What role does he play in it? What role do 0:16:53.480 --> 0:16:56.200 his sons play in it? How connected is he to it? 0:16:57.560 --> 0:17:01.400 So here's the story from what I've heard, is that Hero, 0:17:01.880 --> 0:17:06.480 who until recently was running a one hundred and forty 0:17:06.560 --> 0:17:09.480 nine dollars a month get rich Quick class and he's 0:17:09.520 --> 0:17:13.080 a total unknown in the crypto world. But through a 0:17:13.359 --> 0:17:17.720 friend of Trump's, he got connected to the Trumps, and 0:17:18.040 --> 0:17:23.760 Hero had a defive venture called Doe Again just one 0:17:23.800 --> 0:17:27.439 of like countless crypto startups that seem to have failed 0:17:27.480 --> 0:17:31.600 to attract much Trading at All is a place to 0:17:31.640 --> 0:17:34.119 borrow and lend, but just only attracted a few million 0:17:34.119 --> 0:17:38.359 dollars before getting hacked, and Hero pitched them on starting 0:17:38.400 --> 0:17:40.679 a new venture that would be similar to DOE. But 0:17:40.760 --> 0:17:45.600 it's called World Liberty and I obtained a white paper 0:17:45.640 --> 0:17:49.760 for it. The Donald Trumps is at the top of 0:17:49.800 --> 0:17:54.080 the list of the people involved. His sons, Donald Trump 0:17:54.160 --> 0:17:57.879 Junior and Eric are Web three ambassadors, and even Baron Trump, 0:17:58.160 --> 0:18:00.679 his eighteen year old son, who just started his freshman 0:18:00.760 --> 0:18:04.600 year at NYU, is listed as a defive visionary. So 0:18:05.200 --> 0:18:08.240 the Trump family seems to be, you know, deeply connected 0:18:08.240 --> 0:18:11.560 to this. But from what I've heard, it's a Hero 0:18:11.640 --> 0:18:15.720 and his longtime friend and business partner, Zachary Folkman, who 0:18:15.800 --> 0:18:20.080 used to be a teach pickup artist classes like how 0:18:20.240 --> 0:18:23.760 to teach men how to hit on women. These are 0:18:23.800 --> 0:18:25.400 the brains of the operation. 0:18:26.560 --> 0:18:29.280 I mean, I know we're having fun with this. I mean, 0:18:29.280 --> 0:18:31.280 but I feel like, you know, the crypto world like. 0:18:31.280 --> 0:18:33.600 We have to be careful. We've seen, you know, when 0:18:33.640 --> 0:18:36.879 things can go astray. I mean, what do you I 0:18:36.880 --> 0:18:40.239 don't know the respected folks within the crypto world do 0:18:40.280 --> 0:18:43.000 they know this person, do they have views on this person. 0:18:44.320 --> 0:18:48.480 Right, like crypto, this is in the industry where you know, 0:18:49.480 --> 0:18:52.320 it counts as like a innovative startup if you just 0:18:52.480 --> 0:18:55.080 sell coins with a picture of a dog or a 0:18:55.119 --> 0:18:57.359 cat on them or something like that. And even in 0:18:57.400 --> 0:19:01.080 this world crypto investor were like, we never heard of 0:19:01.119 --> 0:19:08.400 this guy. This seems super dubious. They people were really 0:19:08.400 --> 0:19:11.480 excited because Donald Trump, who used to call bitcoin a scam, 0:19:11.840 --> 0:19:14.840 he changed his position and he said he's going to 0:19:14.920 --> 0:19:17.720 fire Gary Gensler, the SEC chairman, who's the enemy of 0:19:17.720 --> 0:19:21.000 the industry, and he's going to push for new regulations 0:19:21.000 --> 0:19:23.840 that will help crypto. So everybody liked that. And now 0:19:23.840 --> 0:19:26.600 they're like, ooh, you're gonna do your own coin. 0:19:27.400 --> 0:19:29.480 No, this is a bad look. 0:19:29.600 --> 0:19:32.600 That was the consensus of the dozen or so crypto 0:19:33.240 --> 0:19:34.359 investors that I talked to. 0:19:34.680 --> 0:19:38.120 What are they actually be selling those zeke And when 0:19:38.119 --> 0:19:40.520 we look at Trump's history and business, obviously he's known 0:19:40.560 --> 0:19:42.800 for real estate, but there have been many failed businesses too, 0:19:42.800 --> 0:19:46.600 I mean Trump Airlines, Trump Steaks, Trump University, Trum Vodka, 0:19:47.040 --> 0:19:50.720 some of the casinos. Yes, no question there. We know 0:19:50.800 --> 0:19:52.800 what he was selling with those though that it was 0:19:52.800 --> 0:19:56.680 in the name. What is he actually selling with this project, So. 0:19:58.040 --> 0:20:01.280 The details that he announces may change. But according to 0:20:01.359 --> 0:20:04.359 the white paper, this is going to be like a 0:20:04.800 --> 0:20:07.320 platform for borrowing and lending, and it's going to have 0:20:07.400 --> 0:20:11.880 its own token, also called World Liberty, I believe, and 0:20:12.119 --> 0:20:15.440