Kook's Weekly - December 28

[00:00:06] Speaker A: This is the AST SpaceMobile Podcast. It will just basically come to your phone and be seamless regardless of where you are. We don't want the user even to know that it's connected by satellite. Listen, the opportunity that we have is very, very, very large. Okay.
[00:00:28] Speaker B: Hi everyone. I figured I'd keep the tradition alive, although it was coming down to the wire when I got banned yesterday. I got silly amped up on all this fraud stuff that I was trying to encourage Bill Ackman to, quote, die on this hill, Bill. And X construed that as a death threat, apparently. So despite me protesting them and saying that dying on this hill is a colloquialism of, hey, this is important, I got banned, which made me think. And I was telling Landpin Man and Tut, I was like, oh, this is great. My account is dead. I couldn't really unlock it because I forgot which email I tied it to. And so I thought, I'm just going to start a new account and see actually how many people follow me, which would probably be About 160. And then I spent the day without X and I looked up and I saw this beautiful world and happiness and realized that maybe X is not good for me, but it is the source of all of my research. So I'm kind of stuck between a rock and a hard place on this doom device that for some reason figures out how to make you really depressed. But anyway, Things that don't make me depressed are launches. And so this week, it already seems like a lifetime ago, honestly. We had FM-1 launch. This rocket torqued. It was super cool to watch. And I mean, this thing just like got up after it when they hit the ignition. So it was pretty, pretty cool. What was less cool was some of the crappy video stream they had. So when this thing froze, it froze on me at least, and I thought, Oh dear God, you know? And so, you know, I know that's what a lot of the shorts were open for, but then I would kind of whack my phone and I was sitting there with my tour guide who all of a sudden got super interested in this as well. And then we'd see, you know, that it was still going. So it was a great launch and great for India. Good for them. It was really cool to see the type of publicity we got from the launch, which tells you that this was strategic in nature. I don't know for this to be a fact, but it does strike me as pretty obvious that FM-1 and FM-2, these are SDA satellites. So that's, that's not really the question. It's, it seems like they are testing out alternative launch providers as well with these test satellites. So these satellites are really for the government to trial some new technologies, which then will go into Golden Dome. And so FM-1, FM-2 are these really interesting military satellites in my belief. And I think pretty obvious when you read all the documents. And then they're going up on non-SpaceX launchers as part of a diversification strategy. So I also think that FM2 will not be going on SpaceX, which is going to provide for a pretty interesting event for us all. So after we launch, getting to orbit is step one, big one. That's a very important— it is necessary but not sufficient for a successful satellite. The next step which is also necessary but insufficient, is for the satellites to actually establish communication. So the company, uh, is very generous to us in immediately notifying us when they establish connection with the satellites, which they did. So these satellites are now zipping around 17,000 miles per hour. I've been able to get my birdwatching software working, so I'll start publishing that. I know a lot of other people have posted the trajectory of the satellites and all the space orbit data, which is cool to watch. And we'll be certainly tracking for signs that they have unfurled. And so Scott is trying to change the nomenclature to unfold. But as someone who for no reason whatsoever likes to sort of annoy Scott, again, no real reason, just because I can, I'm going to continue to use the word unfurl. Until my last days on earth. And so when this unfurls, I'll let you all know if other people don't know in advance. So what's cool about launch is you get some information. So the company played the hype video with this commentator, Emma Yorna, who did a great job. And these hype videos actually contain a lot of interesting information. So if you study the company very deeply, Some clues are confirmed in what otherwise might be glossed over on these videos. And so, for example, one thing that I recently brought attention to again was the capability for ship-to-ship transfer, and they show this in the video pretty clearly. So what's interesting, if you're in the middle of the ocean, there's no ground stations, obviously. And while you could use optical inter-satellite links to beam the data somewhere in the world where there is a ground station, then you run into data sovereignty issues. And so think about the Pacific Fleet operating off of China. Where are they going to beam the data?
[00:05:33] Speaker A: Taiwan?
[00:05:34] Speaker B: Well, depending on the reason why they're off China, Taiwan might not be the place you want to beam your data. And so for ships to communicate with each other, what ASTS has is the capability for the data just to go up to the satellite and straight back down to another vessel without using a ground station. This is pretty interesting capabilities that the US Navy is very interested in. This isn't speculation on my part. I know this for sure. And the company again showed us this in the, in the video. So that's what's neat about these videos is if you're a very attentive watcher, I'm sure there's stuff I missed myself, but I did pick up on that, for example, and we'll get to the military stuff again in a second. There's also a really neat gallery. So if anyone's looking to collect any pictures of the LVM-3, I posted that for you. I know I'm going to be ordering my new scale LVM rocket now that we've had this successful. So I have my PSLV rocket, which should be arriving any day. I gotta just make sure this is exquisite quality because If there's one thing I take very seriously, it's beating Anpanman in everything. And so I noticed that his rocket collection seems kind of like a piece of shit. It's like some 3D-printed garbage made out of plastic, and it really speaks to the quality of his account. I'll probably get banned for this, but you know, Anpanman is known for kind of quick and dirty. So I'm willing to wait three to four months to have custom-made rockets made. I believe my rockets are being made in Kazakhstan, which is. which is why they're taking so long to get to me, but they're going to be awesome. And so I can't wait to have my LVM-3 rocket, and then I'm gonna get my New Glenn rocket. But I need to see if we're launching on normal New Glenn or New Glenn 9x4, because again, I'm gonna do it right. And, um, you know, you gotta have high quality. And that's why I suggest you, uh, only join Spaces with people who have been cited by world-class journals as well. That's the new thing I'm going to hold over Impenman till the end of time. So we also had some really cool videos. There was this company, I don't know, some shitco, AT&T. I think they own like a phone company, but they retweeted launch for reasons unknown to anyone, um, because apparently they were going to drop AST SpaceMobile for SpaceX any day. But they seem to not have done that, and instead they tweeted boosters on, wings out, and then hashtag SpaceMob, and they're CCing AST SpaceMobile to remind AST SpaceMobile who the cool people are, Space Mob. And that video's pretty neat. And there's, you know, a lot of interesting content. What is pretty unusual is to have the prime minister of a country congratulate your little apparently irrelevant SPAC with the success of their mission. And so Narendra Modi did not take me up on putting the red A in his name, shockingly. So I'm going to have to have my people call his people and get him on board to fix this grave mistake he made. But he did, to his credit, tweet 2 or 3 times about ASTS's Bluebird. And so this is a really big deal for India to have a US customer do something quite remarkable. Again, the largest commercial array ever launched brings a lot of attention to the Indian space sector. And to their credit, They pulled off a heavy launch successfully, dramatically again, because this rocket just seems like it's totally metal and good job to them. So hopefully they get some more business, you know, and glad we could have been a part of it. And this local market content I believe is important. And so I have a background in natural resources and with natural resources, everyone already has, always has their hands out. You know, you really just can't bring in an all-American suite of kit and expect to have a lot of friends in the places you're doing business. And so it's important then to have local content. And local content means including parts of the value chain in the country you wish to do business as a show of goodwill. And, you know, frankly, sometimes you're actually required to do so. And so launching with an Indian partner gets you quite a lot of accolades in India. And so then we also had our partner, I think it's VI, it's Vodafone India, retweet us as well, just confirming again who our strategic partners are gonna be in this market. So what comes next? So what comes next is the satellite is hurling through space doing somersaults. In the vacuum of space, it's difficult to have it stop doing somersaults. So this takes a little bit of time for it to do what's called detumbling. And then after that, what we believe happens is they have to wait for enough solar energy to be generated and recharge the batteries and do whatever they gotta do to then proceed with the unfurling. And again, I repeat, unfurling of the satellite. So what we also know to be true is that the unfurling of this satellite, despite it being larger, is in fact more simple.
[00:10:49] Speaker A: Okay.
[00:10:49] Speaker B: So the company has a chief simplicity officer, which is great, super smart position, and I think most companies should have one, figuring out how to have the least amount of action in the satellite as possible. Action, more action equals more opportunity for things to go wrong. And so here, what we do know is that in ASTS's massive satellite production facility, they have the ability to test this action and they are unfurled and refurled and unfurled and refurled over and over and over again, and they test it. like crazy so that there's a very high probability of this going correctly in space. To date, we are 6 for 6 of unfurling satellites of increasingly large size in space, and there's every expectation that I have that this one will also be successful. And that should happen provided there's no little issues that came up. So for example, there was an issue that came up in BW3 with some strap or something happened and it just took a while longer for the satellite to detumble. Forget the specifics, but what we know is that this could actually happen somewhat quickly. The company's now gotten pretty good at this, and so I'd expect this to unfurl within a month or something. Between here and there, I believe we're going to have one, potentially 2 additional launches. So launch, launch is the new tariff or COVID or European crisis, as it turns out. And so shorts have gotten so accustomed to thinking that dumb retail is just going to bid stuff up into launch and that everyone's going to sell the news, that that becomes a self-fulfilling prophecy. That's exactly what happened on Wednesday. And then Friday, frankly, the magnitude was a little bit shocking to me. I'm not, I don't want to say shocking because I'm actually not really shocked. But surprising to say the least. And so you almost wonder, like, if the rocket had actually blown up, would the stock be higher than it is today? It's like kind of like maybe that would've been the real plot twist. But the shorts took advantage of the situation and just drilled the stock into absolute oblivion. And, you know, this I think is really par for the course. It doesn't really concern me at all. I know a lot of us again, I wasn't really expecting the stock to trade off, but I was positioned so that if it did, I wasn't going to get, uh, hamstrung on my ability to make some adjustments to my position for what I believe to be an inevitable, uh, reapproach to the highs. And so the chart's really cleaned up and everything, but shorts slammed this thing. And what I think that they're maybe missing— and this is where I really thought a lot about on Friday, thinking, well, the pattern's pretty obvious— and then Most people think that there's this massive lag between launches because, you know, to date with AST, that's been the case. It's, they've had a lot of time between launch and next launch. What I don't know that the algos and the shorts have totally dialed in is just how quickly FM2 is going to have a launch date scheduled. And then I do not believe that the algos and the shorts have really reflected on what's going to happen when we have Batch 1. So that's my own sort of term, Batch 1 and Batch 2 get slated because Batch 1, Batch 2 is where the party gets started. In actuality, FM-2 again is an SDA satellite and very interesting for the military perspective, but it's really sort of like the first, first hamburger off the line when your key objective, objective is to make a McDonald's. The first hamburger off the line is not really important. It's the fact that there's a billion others that are gonna come behind it. Batch 1, batch 2 are the actual production satellites. They're gonna form the backbone of our constellation. And that's where the actual value creation is gonna occur, is putting this constellation up in space. So we did get FM2 out the gate. That's very exciting. And you, have to realize that the satellite was probably ready to be out the gate before. What was holding it up was the readiness of the launch vehicle. And so AT&T did us a solid and said, hey guys, who's ready for the next launch? That's pretty cool. So there was a Cape Canaveral roll call. I really hope that I'm able to go. I just have a couple things that I can't schedule around unless I wanna— blow up my career, which might be a real strong question I have to ask myself depending on the launch event. But hopefully that's going to not have a conflict so that we can go to it, or I can go to it. I'm sure everyone else can go. And then you ask yourself, well, if it was a wait for the launcher question, which launcher would it be? Since there's a very specific type of launcher which is tending to always be ready, and through the process of elimination, we know that we're probably not going to be launching on the Space Shuttle, although that would be lit. Um, so I'll leave it to others to start to guess. The other thing we know is that we don't have an approved STA for FM-2, which is a point that I think Tanner or Kevin brought up, as always, the smartest people on—
[00:16:16] Speaker A: Yeah.
[00:16:17] Speaker B: Earth. And so then you go, well, huh, if SpaceX requires an approved STA to ship and this shipped, I wonder what we could conclude. And then ASTS put up a webcast template saying Bluebird 7 launch coming soon. So I haven't given my orders to Scott yet. Um, my name is Christophe, and I like to tell him not to cross the bridge and don't go out in the water. And so we'll see what command is given, but it's very possible that Scott might have received a command to release a launch date next week, which would be great if that command was in fact issued. So as we build out the coverage, we had an interesting tweet from Daniel Thomas, who's the commercial lead of Vodafone, and he just said that approximately 20 minutes of coverage is created from each satellite that is launched. And so then we can start to do some math. about just how quickly intermittent service is going to build and sort of like building railroad tracks to form the Union Pacific. There will be a point where you no longer just have like a spur line going from New York to Ohio, but actually from New York to San Francisco, and you have the continuous coverage. That will be pretty good. And then we had Justin put out a nice tweet just simply on just the time between satellite launches. So 41 months to 24 months to 15 months to, you know, this is really collapsing. seen, which is good. Collapse is good because our satellite factory has been built. And a key thing that I think a lot of the bears miss is the complexity of getting to the new generation design. So the first things you had to tackle was, first of all, the original control set and the arrays. Then you had to upgrade the control set. You already had the arrays, but FM1. was a big engineering challenge to get done, but then they did it. So something that was difficult at first to do when replicating it is no longer difficult to do, which then allows what I have lovingly called the constellation constipation to end, and we shall flow freely very shortly. And the company has also changed its wording. And so now they've gone from saying that satellites are in various stages of production to saying that they're in various stages of assembly, integration, and testing. Aha. And I also posted something where I took this work and put it in PowerPoint slide format, which is my preferred way to identify myself as not Gen Z. And you can see that the ramp-up is happening. And pretty soon, I think in terms of T-accounts, because I'm an accountant, And so I like to think of satellites being thrown into the work in progress T-account and then being credited from that work in progress T-account and debited into the finished goods or finished satellites T-account and then upward into space. And so pretty soon what we're going to start to have is a lot of these satellites shift from in production assembly and testing to actually shipped. And that wording change to me tells us that we probably now have 6 satellites, so batch 1, batch 2, getting ready to ship 'cause they're in final vibration testing and TVAC, which is what it's called. And that's gonna, I think, be a real shock to the market when the company proves that they're actually gonna get it all done. We also had a really cool video come out which featured John Joyce, who's the VP of production, and it shows a behind-the-scenes look at how these arrays are assembled. But to me, if I'm a bear, if we go back to some of the bears like Mr. Pink, you know, and, and also this Dr. Smorgasbord kind of implying that ASTS is the Nikola of space, in other words, that there's no engine. These videos show you that there's actually a lot going on here. And it's a shame that the company hasn't let its citizen journalists into the factory, although frankly, I haven't asked, because seeing Is believing. We have been able to find people who have been inside. Some of these people, all jokes aside, are expert consultants and validate sort of the ramp-up. We've seen Ted Cruz and Brendan Carr go to the facilities. And so seeing the production would be to understand that it's all going to come. But you can see how people that are doing 5 minutes of due diligence and sort of pattern matching free revenue growth stories might think that, you know, it's all hat, no cattle. Well, they're going to be very surprised pretty soon when these satellites are coming out the door at scale and then they get their faces ripped off. Which brings us to catalyst season. So Anpanman and his poor quality 3D printed rockets did in fact do some quality work of, I mean, this is a crazy tweet. This is like Bill Ackman wrote this tweet. Of every single milestone and event and achieved milestone that's happened. I mean, this is crazy. And so there's a reason why his tweet got 100,000 views is because it's a really good tweet. I won't read it all, but let's just say that to anyone that is looking for an event-driven situation, this is a pretty good one. And it will transition from event-driven at some point to just actually being a high-quality secular growth stock. And that's a pretty interesting transition because that's usually when it gets away from spiffy hedge fund guys like me to then the Ron Barons of the world who just dial in the growth, lock, load, buy, hold, get rich. Pretty good strategy for those guys. And then interestingly, someone fed the stats to Grok and just said, hey, calculate the stock price. And Grok got it right, In my view, I'm just really understanding the relationship between satellites in orbit, cash flow, stock price up. And I've done some basic math just for my own purposes that I included in the DD doc, which do a simple calculation of just saying, will they produce some satellites?
[00:22:34] Speaker A: Yes.
[00:22:34] Speaker B: At what rate? You know, I have an assumption. Dial those satellites in. Each satellite is going to generate a certain amount of data capacity, just Because of its throughput. And so then, you know, through some other calculations which I show, you can get to how much, you know, saleable data there will be. And I just threw $2 a gigabyte on there and then multiply it by 50% to get to what my net revenue is. I believe that this is a very low number compared to what they're actually going to achieve. That notwithstanding, you could— it throws out an EBITDA number. I dial in some OpEx. I'll be wrong on that, but not off by a mile, maybe off by $100 million here or there. and then I put an EBITDA multiple on it, out comes the stock price. And so my belief is that that will represent a conservative estimate of where the market will actually price this thing. And that's why I have pretty high expectations of why the stock is going to be a great investment in 2026. So it's already been a great investment, but it will be a greater investment. And then the other thing that I've become really humble to in my old age is just listening to The world. And so when the world says we're going to deem space to be this monstrous national security priority and we're going to make 6G leadership this priority, blah, blah, blah, like, just like, don't overthink it. That's the thing that is going to get capital flows and is going to go up. And ASTS is squarely in the middle of this theme, if not the leader of it. And so that's why I think that over the next years, this is going to become the narrative that is highly, highly valued in the stock market and is going to set up to generate some astounding returns. So I hope. Now we have Goldendome. And so I've been spending some more time really trying to understand how these approvals work, and I'll post some more stuff on this. later. I'm still just gathering some information, but I'm still convinced that ASTS is, is in Golden Dome, is going to be a major part of it by way of the SDA, which feeds technology into the MDA. And I believe we're going to be very prominent in the transport and custody layers of Golden Dome, and that we'll all find that out soon enough. And I gave some tweets that Katzi did and Tough for You so that other people can start to brush up their own knowledge so that they're not Surprised by anything. Meanwhile, we have Brian Dorland, who's the principal director of space tech for the US Department of Defense, small little organization that buys guns. And he said that, oh, interestingly, he gave 5 startups that stood out this year. Number 1 was not Rocket Lab. Sorry, Rocket Lab bros, we beat you. Number one was ASTS SpaceMobile. And so, and he said, we demonstrated, past tense, direct-to-device connectivity using large deployable LEO satellites and unmodified smartphones. Quote, this is a genuine architectural shift in global communications. Huh. Sounds noteworthy. And then he talks about this company called Rocket Lab. So then we have FirstNet funding and they again keep talking about, quote, in addition to new terrestrial cell sites, the announced coverage enhancement includes funding for satellite direct-to-device services. So we'll find out how this ends up translating to money, but it's happening. And I don't know the timing. But first, that's definitely happening. Now we think about just the evolution of the shareholder base. And so this goes just to maybe an outgrowth of what I was just saying about how ASTS is going to go from this sort of heavy event-driven stock to sort of like a high sponsorship, long-only name. And Cathie has a tweet that just talks about where the borrow fee's going to be and Institutional ownership and things like that. I think that's all going to happen, especially as batch 1, batch 2 happen, because that's really the operational execution phase of the company and the monetization phase. And that's where the if versus unless framework that I've put, it's in the document if you don't know what I'm talking about. That's where all of a sudden everything sort of becomes an unless statement. And for a big long only that's going to buy 5 to 10% of the company, Investing behind unless statements is a much more prudent path than investing behind if statements. And if you don't know what that means, again, please refer to the pinned tweet in my profile and it's up in the front and it's a big slide that says if versus unless. And it's a very interesting concept, which I've tried to apply to my work. Now we have SpaceX. So it is useful, and I've summarized this in some other slides that just show that when people think that SpaceX is so far ahead of AST SpaceMobile, they're not doing the multiplication right. And so SpaceX is going to need about 5,000 satellites for some of this analysis to get to continuous direct-to-device satellites. So when people go, oh, they already have 750 satellites, well, okay, so that's like what, 15 of the required constellation. We might have that up as well by February, depending on batch 2. So who's behind? And even if Starlink had their full constellation up, are they really ahead given the architecture of their system, which is immutable, cannot change? That might really never even support frictionless voice calls, which is a point that Kevin Chen has pointed out, is that they might not be able to do voice over LTE. It might only really be through WhatsApp, which is sort of where the disclosure is pointing to. Seems like a problem. And then Elena also kind of came out saying, you know, really the problem is there their link budget. And so this was in response to changes in, I believe it was Tesla roofs to basically improve the radome of the vehicle so that it could work with Starlink. And she points out some of those flaws. So, you know, you can't change physics. And Starlink, as everyone knows, is really the kind of shoddy response to ASTS bursting on the scene and Elon repurposing the Chamath Swarm business, which was meant for IoT only, to try to do direct-to-device, which might have been a flawed concept. And lastly, we will just point out that other people in the industry kind of humorously are calling out Tim Ferriss as just saying things that are, in this particular instance, saying this was the dumbest thing he's ever heard, which comes as no surprise to Space Mob because most of what these expert consultants have done is contort small out-of-context facts to run a narrative. And then one might ask, well, why do they have this narrative? And it's become very clear over the past 5 years that they're paid anti-pumpers to help protect and defend the legacy incumbents. And that's really not that controversial of a statement at this point. And it was a valiant attempt and almost worked, but then ironically drove most of us to actually really study the company much more deeply than we otherwise would've. And it goes to also these other shorts where I just can't quite understand what they're doing. But I did invite Stone Fox Capital to be on the Spaces. He never responded, uh, nor did Pivotal Capital, nor did Dr. Schmuckraker. And so none of these shorts ever are willing to come on the Spaces where I would actually give them 5 to 10 minutes without interruption to present their short case, sort of channeling the energy Charlie Kirk had of just Let people, you know, let people give their opinion and then let it speak for itself. And, you know, I wish one of these guys would actually join me because I really would like to actually prove that I have the self-restraint not to interrupt them, which would be a true challenge for me. Every bone in my body would want to interrupt them and start viciously attacking both their opinions personalities and ultimate reason on earth, but I would put myself on mute so that all those interruptions would in fact be silent to the broader audience. But alas, none of these guys have been willing to show up, so we'll never know if I actually have self-restraint. So that's it for this week's weekly, and I would just point out that as I've been traveling the world, it has been remarkable how often I do not have cell phone service. And it is also remarkable how many people are also doing the same travels I am doing, which then means they also do not have cell phone service. And my guide was telling me yesterday that he'd had some people that got lost on a trail and they ended up having to do a search and rescue because there was no cell phone service. And 2 Irish girls sort of were overconfident, went on the wrong trail and got lost for 8 hours. So, you know, it looks like there's some demand out there for services like this. Even in the narrow use case of just simply solving dead spots. So that's all I got. I'm looking forward to a big week in, you know, we do have another holiday week, so it wouldn't necessarily be the ideal time for the company to drop a ton of news, but I think the news sort of drops itself because FM2 is, they need to announce that it has arrived at a facility, but then that will be really funny when they announce which facility. And then I don't think we're going to get any news out of FM1 for a while, which is fine, but the countdown for batch 1 is starting. And so I would imagine the next 1 to 2 weeks we're going to get batch 1 out the gate, and that is going to be a seminal event for the company. Whether the stock price moves or not, I don't know. But for anyone that's a long-term investor, That is the moment when you know that this company has transitioned from an incredible R&D experiment to really an N-of-2 operational story, because the only other company that can produce satellites like this is SpaceX. And ASTS is going to be one of the largest satellite producers by tonnage in the world. And I think Tanner actually did the exact math, but The just simple tonnage of spacecraft that this company's going to be producing on an annual basis is unprecedented. And so that, given that the world is rapidly realizing the power of the space economy, should be a very valuable thing to own. Thanks again for joining me on such short notice, and I hope everyone has a wonderful rest of their day.
[00:34:11] Speaker A: Thanks for listening to the AST SpaceMobile Podcast. If you enjoyed this episode and you'd like to help support the podcast, please share it with others, post about it on social media, or leave a rating and review. To catch all the latest news about AST SpaceMobile, make sure to subscribe. Thanks again, and I'll see you next time. We're doing something very, very And I think with this technology we can really affect a billion lives. AST SpaceMobile is the only company that has proven technology to deliver cellular mobile connectivity directly from space to the everyday smartphone. People will just basically turn on their phone and be seamless regardless of where you are. We don't want the user even to know that it's connected by satellite. Our role is to bring this into reality, always in partnership with the animals. Listen.
[00:35:17] Speaker B: Mmm, waffles.