Skylo has emerged from stealth mode, announcing a $116mn war chest of investment to pursue its plan to build a global Cat-NB network using existing satellite infrastructure. However, its $103mn Series B round was led by SoftBank, a company that has severely whiffed on several recent investments, and a superstitious investor might think SoftBank’s seal of approval is more a sign of a looming death spiral.
Pragmatists will argue that Skylo already has the cash, and even if SoftBank’s investors start tightening its purse strings, Skylo isn’t beholden to them and can spend this $116mn on its LPWAN plans. However, if the cash is being provided in chunks, and not one big cheque, then Skylo does need to pay attention to SoftBank’s bumbling Vision Fund antics – which could be enough to oust its CEO, should things get much worse.
In the meantime, Skylo is already talking about its network in the present tense, saying that it is hosted on existing geostationary satellites, ‘enabling immediate connectivity for customers, without the need to add new infrastructure in space.’ It claims that this provides industries like agriculture, logistics, and utilities with an easy way to connect IoT sensors ‘for the first time,’ (laughably untrue, but there we are).
Notably, it has not talked about existing customers or pilots, although it does claim that it is 95% cheaper than existing satellite solutions, costing $1 per user per year, with hardware costs less than $100. Now, it is quite evidently comparing itself against the conventional crop of satellite operators, and seems to be ignoring the emerging gang of Low Earth Orbit (LEO) nanosatellites that have generated a lot of buzz.
Some of those rivals are using non-standard protocols, but others are exploring how to use LoRaWAN (usually via ground terminals). Sigfox is in on this action too, via a partnership with Eutelsat, and while we thought it wouldn’t be long before somebody tried adding L-LPWAN to the mix, we had assumed it would be via LEO nanosatellites, rather than big fat GEO sats. Ligado is trying to build its own Cat-NB satellite network, which differentiates it somewhat from Skylo, although it is still trying to secure spectrum in the L-Band (1.5 GHz to 1.7 GHz) to this end.
The Skylo Hub is the end-device in Skylo’s network – an 8-inch square that might be all of an inch tall, the white plastic unit aggregates data and beams that data up to the satellites via Cat-NB. This data is then beamed back down to the ground units that connect these satellites to the wider internet, and then into Skylo’s Data Platform – the cloud environment where you can view the sensor data and hook up APIs.
The initial target markets on Skylo’s website are Disaster Management, Maritime, Fleet Management, and Agriculture. It points to its hubs being IP67 compliant, as proof of their suitability for deployment in rugged field conditions. For vehicular use, Skylo is also claiming location accuracy of less than three meters.
However, that’s about as much information as Skylo wants to share publicly. There is mention of Bluetooth and OBD-II, for connecting things to the hub, but there must be more I/O ports to cater for the massive variety of sensors out there on the market.
It says it has tested the network with early commercial partners, but won’t say who, only that they were in both enterprise and government, across the aforementioned fields. Light Reading says that India telco BSNL is working with the firm, however, to connect polling stations, and the outlet adds that Skylo has tested connections to Indian fishing boats.
With offices in California (HQ), India, and Israel, and founded in 2017, it lists only 3 employees on LinkedIn – although its About page says it has 11-50 staffers. It plans to begin global rollout this year, starting in India, with Light Reading saying that Indian Railways will be its first customer.
Of course, the Cat-NB approach is going to encounter many of the same problems that conventional satellite deals with. Line-of-sight with the sky is going to be necessary, as we severely doubt it is going to be any good at indoor or underground propagation, and the battery life of the Hub itself is a big wild-card, as it is going to need a power supply to act as a Cat-NB gateway for nearby devices. In theory though, it shouldn’t need more power than regular Cat-NB communications though, as there’s a lot less interference firing beams straight up into the sky than trying to blast them through obstacles at ground level.
To briefly recap our thoughts on SoftBank’s recent investment prowess, the recent WeWork farce has led many to question the veracity of the $97bn first Vision Fund, especially after the Uber IPO valuation debacle. Some 80 companies have received investments from the project, but with WeWork and Uber the most high-profile investments, the brand has taken a bit of a battering.
When SoftBank invested in WeWork, it was valued at $47bn. Rumors began trickling out that things were not well in the run up to the IPO, and the valuation was shifted down to the $20bn range. The IPO was then delayed, due to the scrutiny of the financials, and now the CEO has been booted. To this end, it looks like SoftBank can’t do due diligence properly, doesn’t understand Silicon Valley particularly well, or is just a whole lot more optimistic about the potential payoff than the wider financial community.
For companies that received investments from the Vision Fund that have actually completed the IPO, Uber is down around 30% from the filing price, with Slack down around 25%. Of the six total that have filed, only Guardant Health and 10X Genomics are above the IPO price.