San Diego Tech News Weekly – November 14, 2021

Welcome, welcome. Hello, everyone. This is Neil and Jonah here for this week in San Diego. Tech news coming at you, a little delayed, but still relevant. Lots of good news. How are you doing, Jonah?

I'm awesome. Yeah, we're hanging on a Sunday. We pushed back a little bit later. I mean, I think all of this is still so hot and fresh out the presses, as they say. But yeah, I'm glad we got to get this in. Why don't we, why don't we dive in?

Yeah. Real quick, Neil Blum here from Fresh Brew Tech and the tacos and tech podcast that you are listening to this on and Interlock Capital. And this is Jonah.

Oh, yeah. What's up, everybody? Jonah. Done some ops work, Marketplace builder, Lime Handy and postmates, maybe. We sent some ops professionals to your house and just thoroughly love in San Diego. Love our tech scene and what we're building here. So we're. Why don't we dive right in? Have you seen this? This consolidation is going on in space. We love space here. We love killer.

Yeah.

Tell us this headline. Why don't you lead us in?

All right, so Carlsbad's ViaSat just acquired a rival satellite maker for $4 billion. In oursat another good one by Mike Freeman. Oh, man, where's my bell? We always love a good article about Mike.

We need a mic noise.

He covers the big tech like no other. And we love what's happening in space. Space. I worked in space for five plus years and it was not necessarily hot. It was kind of its twilight era, honestly, from 2008 to 2013. And now it's smoking hot again. There is so much activity happening in the space world. Love it. And part of that, honestly, SpaceX has helped really kind of rekindle a lot of things, especially the putting constellations of satellites in space. All of a sudden, everyone wants to do it all over again. But ViaSat's been doing it for a while. ViaSat is a maker of high, high expensive satellites. We're talking billion, multi billion dollars per satellite that beams Internet back to Earth, whether it's Air Force One, which I believe is using viasat technology, private yachts, and then a lot of new airlines are using viasat Internet. But they have got a challenger in the space in our sats. And by buying out in our sats, geostationary satellites, what they call constellation of satellites, they are getting a little bit deeper into the geosynchronous space. Geosynchronous. Do you want to do this? You want to do science by Jonah?

Yeah, let's Go for it. No, I looked this up because I was like, oh man, geosynchronous. I wasn't really sure what that meant. And basically what that means is you have a satellite that's a little bit deeper in orbit, you know, than some of the other ones you might see in the starling constellations. But the satellite moves at the exact same speed as the Earth rotates. So think of it as sort of a fixed place in the sky which is really interesting instead of, you know, if you're laying outside and you see a satellite or like a solid color light kind of going across the sky, looks like a star. That's typically a satellite closer to orb these you might not even see. They're just going to sit right there, right over certain points of the Earth. And that's how you can get this kind of this network above the planet for communications. Kind of cool. One thing to add though, you know, this brings the, they don't actually have that many. You know, this brings their count to 19. So with the acquisition Immersat's satellites, they have 19 and they're going to add 10 more in the next few years. But Viasat alone, they don't have that many. Uh, so I think this acquisition almost, you know, tripled if not, if not more. They had five and then three more under construction. So it's a good acquisition.

Yeah, Saddle satellites are very, very different from each other. So starlings got about 1800 satellites in or I think it's 1600 in low earth orbits. But because they're so much closer to Earth, they only really can touch like a city or a county. Whereas one viasat satellite can handle like the entire US So very not all satellites are equal. That's why it depends how far away we're talking. Geosynchronous orbit, you're like 15,000 miles away in orbit versus SpaceX will be like 100 to 300 miles up. So very, very different kind of satellites. Low Earth viasat is very much in the super powerful multi billion dollars. Obviously SpaceX going a different approach. Just launch hundreds if not thousands of them and if they fall out, just launch another one and it'll be okay. So yeah, super interesting to see. ViaSat's going to double its revenue. It's going to add 3,000 employees and increase their patent count to 2,500 patents, all off of the satellite space. So $850 million in cash, 3.1 billion stocks. So $4 billion. Deal. But that also means Inmarsats come and is getting about 37.5% stake in Viasat. So almost more like a joining of forces than really an acquisition in this regard specifically. So this is interesting.

That's crazy. I mean that's a massive, massive deal. Did you see what happened to the stock after this happened? I feel like it dipped a little bit. But you think in the long run this is a pretty major move for them. It's just really expensive in a lot of ways. But again, space final, it's the next frontier, right? I mean we need this, we need this type of thing. We're running lines through our city streets. It's like, come on, if you can send it to the sky, that's actually a much, much more interesting option. And sure, let's just tear down some power lines. It'd be kind of nice.

Yeah, seriously. No, you're right. ViaSat stock's been down a bit over the year. It's up. But you gotta imagine because of pandemic lack of travel and having a lot of revenue related to um, consumer Internet in, in the airlines that probably affected it, but over the year they're up. They're up. What are they up? Oh, 67% on the year, but just in the last month they are down. And this deal hasn't really helped, hasn't really kicked in yet. But this is a long term play for them obviously to go and attack the eventual consumer Internet beaming to your house from the space.

So, okay, we can go from super far away from us to very, very close in this next one. Looking at the first time ever a life science company spins out of the San Diego blood bank. I think this has never happened before. It's just a really interesting, interesting one. Do you know, do you want to do a breakdown of what the San Diego blood bank is? I mean fairly obvious, but maybe high level notes.

Yeah, the blood bank, man. It is a nonprofit in a sense that really champions having a bank of blood as it says so many. You probably see the blood buses out in your community doing blood drives. And the blood bank, not only does it store them, but it actually does a lot of research and creates a bunch of data available for the community. Tends to flow towards our healthcare systems and our life science community. Um, but it's pretty cool that now it's also an incubator of companies, right? We've got life science companies coming from ucsd, we've got them coming from other companies and now we've got them spinning out of nonprofits. So the CEO is leaving the blood bank to you know, help, develop, help Commute, help run Community Bio, which is going to help other biotechs develop therapies against deadly diseases. So, yeah, it's the first time they've spun out a life science company, but it won't be the last, I bet. Especially if you see success from this, because this is a for profit company that's spinning out and so. Go ahead.

Yeah. One thing I'd love to add to that, you know, we can kind of talk a little bit more about this story is like, you know, when you, a lot of people are so close to problems, they're just like, oh man, that's the way it is, you know, and this is a really interesting example of them noticing an opportunity and problem, if you will, but an opportunity within a company. They say, hey, let's build this into something else. Let's spin this out. And I think that's super cool when you see this happening. I think a lot of times, you know, many of us, if we find ourselves in sort of big organizations or big companies, we kind of sometimes get ourselves in the, you know, the position of rolling your eyes and being like, oh, well, that's just the way that it is. But it doesn't always have to be, you know, you can, you can spin something cool, some cool tech out of, out of sort of a, anywhere really. A nonprofit, like you said. Qualcomm does it constantly, but, you know, nonprofit. Let's, let's get a couple more of these. This is awesome.

Yeah, definitely. So their customers are research groups and life science companies. Uh, this is Community Bio. You're gonna be selling materials to develop and test therapies on cells. So typically companies are using like teeny molecules or bulk gay proteins. You want to give us a little insight of what, what those are, Jonah?

That might be bulky proteins. Bulky proteins. Not really sure. That could be. We're gonna have to go dig deeper on that and contact Ms. Frizzle. But, but basically, yeah, they're operating on live cells, so not really necessarily using these sort of minuscule, you know, proteins and molecules to do these, these types of testing. One thing that's super cool is they're still partnered with the San Diego Blood bank, which means that blood bank has a stake now in this new company. So this is another interesting way to fundraise is by spinning out a company instead of asking people for donations. So that's. What do you think about that?

No, I think it's awesome. It's super great for thinking about longevity and, you know, succession planning of where, where funds can come from. Um, I got to imagine don't. Blood donations were definitely affected during the pandemic where people not wanting to go in, you know, and be touched and prodded by, by needles. So yeah, but the one thing that you've always been able to do when you donate blood is consent to your blood being used for research. And this isn't specific to the San Diego blood bank like 23andMe does this whole bunch of areas, you know, have the opportunity to say hey, we've got your blood but can we, can we do more? Can we, can we benefit society and make it better? And there's actually another company in town, Luna DNA, who had also had a partnership to allow people to track and understand where their blood bank donations, what happened to it, which, where did, which research pieces was it contributed to, which is cool as well. So I've got to imagine Luna DNA is going to get involved here with Community Bio, the spin out and like we've seen there's huge demand for further growth in the biotech hub. So got to imagine they're going to have a lot of local customer base, which is great as well. And this current company, Community Bio is spinning out which will allow them to raise money as a for profit company, which includes getting funded by a Bay Area VC this time around and has potential, like you said, to fund the blood bank for years to come if they really do hit a profitable partnership, which I gotta imagine they're going after data, so they're not necessarily going after this. They're not developing a drug, so they probably will come to revenue much quicker. Right. They're going to be selling a service to other companies. So more of a B2B play than a strictly pharmaceutical or therapeutic research. Yeah.

Couple additional details to add. The VC firm declined to be named. They didn't want to be named in this article. That's what they said specifically. So I'm not sure quite the reason why that would happen. Maybe you have some insights. But one thing to really add on top of that is basically the blood bank operates at almost break even. It's like a 2% profit margin. And so the whole thing is built on getting donations. So adding this new potential revenue stream or a new company is something that might have the potential to fund them for years to come. So kind of an interesting fundraising strategy as opposed to going around. But yeah, I guess really the way that it work is you give some blood, it would go into the hospital system to help people who need it, but then you're able to check a box and Say, hey, give a small percentage of this to research and so they can use that for testing into the future. I'm not sure if you're anonymous in that case or not. I would imagine so. But maybe they need to tie back to certain ailments to see about testing. We'd have to go a little deeper on this.

Interesting. Well, we'll keep an eye on this for sure because definitely have a lot more biotech news to come, I think, which is only the beginning as well. So stay tuned. Let's jump into our next story. Another area of strength for San Diego is our blue tech economy. This is all areas that touch the ocean or waters in general. And UC San Diego first of all announced their first BlueTech accelerator called Start Blue Partnership of Scripps Institute of Oceanography and Rady School of business at UCSD. And they announced their first cohorts team of 10. And actually I've spoken at the cohort, spoken with the cohort twice now in the last month. And as you as we talked about, this is all about innovating in the world's oceans. So we're talking about things from Anchor Tech, Storm technology, power generation, 3D printed coral reefs, taking algae and other ocean plants and finding energy uses for them, fuel, energy, materials science kind of stuff. It's interesting to see what these companies are doing already. No cost to the program. Most of them are master's or PhD students at Scripps, I believe. And with this they're getting mentorship connections to customers, potential investors. I've done one roundtable with them or it was just kind of like a ask me anything. And then I also did a talk on the art of storytelling to get them ready. Not necessarily about to pitch because honestly they all are quasi funded through their research through this whole year. But I said well, if you don't need to pitch yet, use this whole year to plan out what your story going to be. And so we had a good chat about that. And so benefiting the marine economy, which is massive. It's a $373 billion economy, says the Department of Commerce. That was in 2018. So can only imagine even more so now, especially with our war on climate change, the oceans are just going to be even more and more of a need for, for everything you can think of.

You want to dive in a little.

Bit more of this.

Yeah. So this is pretty awesome. They are looking for more mentors, corporate mentors and will announce in December. But check out Start Blue's accelerator website for this. Start Blue UCSD EDU is pretty good place to keep an eye on that, especially if you have any sort support, you know, if you want to mentor, maybe you have an idea of some customers to refer over. But I thought it was, I thought it was super fascinating the variety there. There wasn't really one company, they had eight or 10. There wasn't one that really overlapped with another. It was such a variety of companies. They did either an awesome job picking them or it just sort of fell that way. But yeah, super impressive. And I can't wait to kind of see how they, how they do develop and evolve.

Yeah, I think check out. We just interviewed Gwen Nero, the program manager on the podcast about a month ago. So go, go back about a month, about four episodes maybe now actually eight episodes and listen in about Gwen, about how they developed this. Awesome. Yeah. And see if you need a connection to them, if you can help them out, let us know. We're happy to connect you guys. Yeah.

One, one last thing. Important piece. I think it was awesome. You're talking about storytelling and sometimes we get so zoomed in and like, oh, tell the story to raise money. But you, you need to convince people to work for you. You need to sell your customers. And so storytelling in general I think is a super valuable skill. So if they're already funded, it still adds a ton of value. And think about storytelling when you're kind of from a ton of different angles. It's not just closing the checks.

Yeah, exactly. Well, especially if they've got eight more months until they really are out of this program. They can really design what the milestones they're going to talk about that they've hit in the past and going forward. Right. It could be a time based thing. Hey, every month we did this or this is the one biggest thing that happened to us during the program. We met Blank who was, potentially became a customer. I think that's all about that, is that it's super important around setting the tone about traction and momentum because you know, if you purely say it's just about revenue, then that's all anyone's going to judge you by. If you don't have any. Hard to judge anyone. So yeah, kind of it's your destiny on storytelling. You determine what you want to be judged by in terms of what you've put into your own company. So there's a great discussion. I don't know if they recorded or not. If so, we should put it out there as well too. But we got to bring it back to another satellite conversation because we love you know what else we love those natural resources and water. You know, we've actually just last week we talked about desalination. Right. We've talked about dam technology that's out for bid right now. The city of San Diego is doing. But a Israeli company is opening an office in Rancho Bernardo to use radar to detect leaks. You want to tell us a little bit more about this?

Yes, it's cool. I think if this was to talk about blood cells, this would cover all three of our stories. But they're not looking for blood. Basically what's really cool is they're using satellites to look for, find and repair leaking water pipes. So they can see up to 10ft into the ground. But these pipes started living maybe about four feet below the sur. It's super cool. So basically they've passed the proof of concept stage and they've actually grown from about four to 18 people. They plan for 26. And those are in San Diego. And they're involved in like 400 projects, detecting nearly 40,000 leaks. There's 38,000, I'm sure there. That counter is continuing to go up. But what they can do, which is super cool, is if a pipe's leaking underground and you might not have noticed you're losing a lot of water that way. But don't forget, I mean, the sewer is a super important place to track leakage as well, because not only is it water, but there's obviously some, some, you know, unsavory things within that sewer. So you got to know what's going on underground. And we can't obviously see. See how much they tear up our roads to. To just replace these pipes. And you know, my neighborhood alone was like. It was like cast iron recently. These pipes were disintegrating in the ground. But one thing that I learned from the story, that's super cool. Well, kind of cool, I suppose. But anyways, they said 20% of power generated in California goes towards pushing water around. That blew my mind. One fifth is just to push water through pipes. Like, what the heck?

It's crazy. I know. Yeah, that's why it's topography matters. Right. If you can. And that's why if you look at like how water agencies, where do they cover? Sometimes it feels so random. But it's purely been topography so that they can take advantage of, you know, kinetic energy around that. But yeah, it's crazy how much we spend just bring water places, which is why we need to be. We need to get into water independent in all of our communities. But that's a Desal conversation and other things.

Right? Well, I think that's a huge, I think that's important because desal is expensive. But what we don't want to be doing is desaling a ton of water to leak it into the ground around the area and then make my bamboo grow like crazy.

Someone's not the first.

But one last thing too that's really interesting about leaking water. You know, you're like, ah man, the water is being wasted. And that's, that's true and that's horrible. But you can also think about other sort of potential risks. Think Big Sur water starts pooling on a cliff or sort of canyon type of topography and that can just cause a landslide too. So you might be able to use this technology to sort of look and find these sort of at risk areas and say, oh shoot, we got water leaking there. Or maybe we need to think about diverting it in another direction. So there's multiple use cases for this, this, you know, and it's kind of cool that they're able to use satellite technology to start to look for these types of leaks underground. Did any of this come up when you were doing some, you're doing some work with some city water districts, I think you had said in the past, any of this comes up, they haven't.

Done, they haven't used radar for this. But I'm going to talk to them about it for sure. What they've been. There's another standard company that wires up manhole covers with sensors that can detect different things. There's can detect leaks, can detect speed of flow, odors, all those kinds of things. Forgetting the name. Oh, it's Smart Cover in Escondido. But now we got another one. We got another smart water company here, Estera in Rancho Bernardo. So adding to kind of our blue economy. It's water, right? So yeah, another good San Diego story here. Love it. Well, good stories, we got four or three quick fundings to mention. Another week, another unicorn, no big deal, not even need a sound at this point because it's old news. No, I'm just kidding. Drata cybersecurity company. These are all actually my former co founders of Portfolium have gone on to do their next company, Drata, which is doing SOC2 compliance. They raised 100 million at a billion dollar valuation. They only came out of stealth mode 10 months ago when they raised their seed round. So they did a seed round, series A and series b all within 10 months. So this is a fast, fast growing company. I saw something around 100% month over month growth in terms of. Wow.

I know. I was going to say when do you actually build your company? If all you do is fundraise.

You know, I guess you just hire enough people quickly enough and they do it for you.

So when it's working, you get. You get people knocking on your door.

Yep, that's true. Another company hone. This is a company all about virtual employee trainings. They started before the pandemic but obviously have boomed during the pandemic. Tom Griffiths and team, the CEO Tom Griffiths, who is former FanDuel co founder actually cool. Went into a very different space, virtual trainings and they raised a $16 million Series A. So go team. They're up in Encinitas. They're in that union in Encinitas. So that's another downtown Encinitas company. And lastly, go share your friends with a truck. Is. This is a. It's kind of like Uber for. For. For moving. Anyone with a truck can sign up to, you know, use their truck for moving things. You can also add a person, add two people to do the moving itself as well. They raise an $8 million. I think this was a seed or a Series A. They've been largely bootstrapped with a few outside financings, but they've. They're evo Nexus company back in the day and have continued to grow. So go Sean and team at GoShare.

Heck yeah. That's awesome. Yeah, that's a fun concept too. You know, it's funny, you see all these pristine trucks driving around the city. But you know, the people on Go Share, they're actually using those things to haul around stuff for us. I think it's amazing. I love that idea. Kind of a. Kind of a. Yeah, the Uber. Uber support. You know, we always think about that. How do I move this thing?

Yeah, right.

Scratching my head. Which friend do I know that has a truck?

Well now you got an app for that now. And I want to see when the first electric Chuck shows up on Go Share when the Rivian shows up. I'll be curious to see when that one comes out. Rivian, an OC company or Irvine base just went public this week. Also the largest IPO since Alibaba. I'm giving some OC news real quick.

Say the revenue real quick.

A million dollars in revenue. So not unlike our friends at Tusimple though. Unlike TuSimple's 8 billion dol. Billion dollar market cap, Rivian is I believe over a hundred billion. After its IPO, it listed at a 75, 65 billion and it is popping the last three days. So yeah, I think they've, they've delivered a hundred trucks so far or so, but they got a hundred thousand orders from Amazon just on. That's on vans which they haven't even started delivering yet to. So there's demand.

Well, they are really interesting this actually I was just like did some side searching. Rivian is now the biggest US company by market value with no revenue.

Not. So there's a go ahead.

I'll say it is. I. Because you're talking about the Amazon deal. What's really, really, really cool about what Rivian's doing is they're advertising the truck as a truck. But they do this really, really cool like skateboard sort of chassis that you can put anything else on. So it's basically just like motors, wheels, a bunch of batteries and then it's like whatever you want on top. So you plug in your Amazon truck, you put the top on, boom. And now you've got Amazon trucks. You want, you want your own truck, you want a different type of vehicle. It's kind of really clever way of building a vehicle platform.

Love it. Well, a lot of people obviously loved it too. And people like companies like Ford, Amazon and our friends at Cox Enterprises were big investors in this. Cox put in and put in 500 million initially and continue to invest over the last few rounds as well. So congrats to them all for seeing and getting in on a deal like this. A company that moved from Michigan to Irvine, their, their engineering headquarters and I believe hq. So I think Orange county is a place to watch for large scale EV manufacturing design and I believe that will, that will continue to trickle down to San Diego too. So SoCal A EV Automotive Headquarters, a heavyweight. It's pretty exciting to see.

Yeah. Last thing, Rivian is now the biggest US company with no sales. I have a thread to pull later. I'll do this after the pod. But let's go back to San Diego. Those are our stories for the week. Thanks, Neil.

Those are rad. Yeah, those good ones. Thanks Jonah and thank all of you. Please check out more@freshbrewtech.com you can hear us every week on Clubhouse at 12:30. Well, most weeks and also on the Tacos and tech podcast network. Thank you.

Yes, thank you for listening. All right, we'll see you later.

Cheers everyone.