Have you ever heard the adage “a picture is worth a thousand words”? The meaning of course referring to a photograph can often demonstrate an idea with one look, much more quickly than a narrative can explain things.
In the case of Planet Labs, an Earth imaging company based in San Francisco, California, the picture and the machine-learning data together may in fact bring a new meaning to this expression.
About Planet Labs
Planet Labs was founded in 2010 by three NASA scientists with the goal of providing a daily scan of the Earth’s surface. Many industries benefit from having consistently updated scans of the Earth’s surface alongside the historical database for past scans. From agricultural efficiency to hedge funds looking for a competitive edge. Currently, Planet’s network of satellites orbit around the earth and captures over 3 million images a day providing a comprehensive scan of our planet. This scan provides data to over 700 customers who make up some of the world’s leading agriculture, forestry, intelligence, education, finance companies, and government agencies.
Today, Planet has deployed the second-largest satellite constellation behind only SpaceX’s, a company led by Elon Musk. With over 200 satellites in orbit, Planet Lab satellites can visit certain areas on Earth up to ten revisits per day and cover the entire Earth’s surface roughly twice per day.
Once the data is captured by the satellites, Planet stores the images in its database and sells access to specific areas of the Earth’s surface to customers.
Applicable Use Cases
High quality daily imagery and data of our planet has become a fascinating topic in the investment community at least in my opinion and has many use cases to generate revenue. By providing key data for these industries to increase operational efficiency, Planet could become an important player in the sustainability space. The demand for Planet’s service could also grow exponentially over time as they further develop their satellites and their platform used to access the data.
Source: Page 26 – Analyst Day Presentation by Planet Labs – September 2021
Life After The SPAC
Planet was brought to life sort to speak through a financing mechanism call a SPAC – an abbreviation for Special Purpose Acquisition Company. SPAC’s are essentially shell companies of various investors who pool their money together. Sometimes a SPAC is called a blank-check company because it doesn’t have any actual operations. Instead, the company is created for the purpose of taking a private company public, hence the birth of Planet Labs.
What I find interesting is that 98% of investors decided to stay on board through the SPAC conversion and 99% voted for the transaction to be approve, (which is not always the case with SPAC deals), so its not a stretch to think that investors truly believe in Planet’s growth potential.
Planet’s long-term growth potential is attractive however not without an acceptance of high risk. A lot can go wrong both in space and on Earth, so it is important to factor in all risks before investing.
What is this week’s takeaway?
With so many headlines on inflation, interest rates and market volatility, gathering intel on new investment considerations may not be top of mind. In the case of Planet Labs who went public last year (December 8th) during a volatile period for stocks, perhaps the same can be said for this satellite and data intelligence company.
After Planet Labs walked away from the SPAC deal with over $590 million in fresh capital including investments from Google, BlackRock, Salesforce and the CPP Investments – Canadian Pension Plan, it seems that well financed investors could also believe in Planet’s growth potential.
Have a great weekend everyone!
Talk soon,
Michael
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