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00:00Talk to me about what kind of satellites we're talking about and what affordable means what are you doing. Swarm. Yeah absolutely. So our satellites are about the size of a grilled cheese sandwich smaller than my head. I don't have one with me here but they are about ten thousand times smaller than the conventional satellites that provide a similar service today. And they're kind of the next variation on this CubeSat form factor that's been popularized by companies like Planet Labs Inspire over the past five or 10 years. And what we mean by affordable our service is less than a Netflix subscription. It's five dollars per device per month that allows companies to connect devices at any point on Earth at any time. Middle of the ocean. The North Pole. Wherever you might be. That's about 20 x lower cost than conventional satellite internet has been. So what do you mean by connect. Does that mean I can use it for telephony. Can I use it for Internet access. Can I you know. Yeah. Watch big swaths of the earth. What can I do with it. Yeah. So it is basically text messages or tweets so you can send a message. That's about two hundred bytes through our network. So it's not telephone it's not broadband but it's small amounts of really valuable data. If you could imagine sending about 50 bytes your position and an s.o.s message could save your life though very small amounts of data can actually be super valuable. You're competing against some existing players I think Iridium is probably the one that comes to mind for many but we also to match point and we think I'm kind of satellite telephony Internet. We think of Starlink. We think of Jeff Bezos as company. You're not trying to occupy that space and yet they may occupy yours. I would imagine. So how do you fight off a bigger rival like that. That may be a pretty good deployment rates. Yeah absolutely. We actually find these companies the OnStar link in one web and hyper as a great validation that there is a ton of interest in kind of activity that these billionaires are developing these companies around the same space. There's actually a huge differentiator. So those companies are providing broadband direct to users and actually have a sterling terminal like backyard. It's a large terminal requires a ton of power basically needs to be plugged into a wall at your house and super high speed. And it's about a hundred dollars a month. By comparison Swarm is really focusing on IO T Internet of Things. Small assets that don't have power don't have a huge amount of area that they can fix something to like US soil moisture sensor or tuna fishing buoy that might be out in the ocean or an electricity meter. So it's really a different adjacent space and we see them as very synergistic. They actually can't do what we're doing due to the bands that they're using. I could go into the physics of it but you'll have to trust me on that point. So we are in kind of this niche space. How do you make money on this. I mean is it just the subscription service or is it just what people pay monthly or are you going to be collecting data as well. Will you be able to monetize that. What's the five year plan look like. 0 5 years well you never know our staff will be in five years but today we're making money on the hardware and then also the data services. And although it's that five dollar price point we have incredible margins. So we actually look like a software as a service company. So a lot of investors kind of drool over that type of gross margins that we see. And then looking up to the future you know we had aspirations of second and third generation networks that will do even higher capacity even better margins and an improved service lowering latency increasing data rates adding on security and things like that. And then there's absolutely a data play. You know that's where a lot of companies are headed. We. We move everybody's data. So we have kind of the kind of front row seat to do interesting things with it whether that's dashboards analytics providing business insights. So we're absolutely thinking in that space as well. But I can't give away too much of our strategic vision here.

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Swarm CEO on the Race to Space

Sara Spangelo, CEO and Co-Founder of Swarm discusses how she is connecting the world through satellite. She speaks with Matt Miller on "Bloomberg Markets". (Source: Bloomberg)

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