Q&A with Startup investor: What is your one investment that you think will pay off big time?


Startup and Venture Investors generally ponder big questions including:  What is your one investment that you think will pay off big time?\

Anurag Bhatia

(Image: LinkedIn)

Here is a response from Anurag Bhatia, Hedge fund manager @minancecapital.com

I invested in a startup at the napkin stage itself. I never, never do this but I had to make the exception because I was excited. I was excited and anxious; anxious because I didn’t want to miss out.

The mission statement is straightforward: provide wifi connection on domestic Indian flights at 1 mbps or more. In a few months you’ll be able to access internet while mid air, and I’ll have a small part to play in that.

Now let that sink in for a minute! Can you imagine the upside potential?

  • About 95 million people fly domestic every year  [1]
  • This number is growing at >20% per annum  [2]
  • A survey by Inmarsat [3] conducted in May 2016 showed that 86% of Indian would fly with a carrier that offers Internet connectivity over one which does not and 66% said they’ll pay for more faster in-flight wifi  [4]

As of Oct 2016, on board internet services is not allowed because of security reasons. Indian security agencies didn’t have the technology to monitor mobile data transmission over Indian airspace. However, in a statement in August 2016, Civil Aviation Secretary Rajeev Chaubey said those regulations were about to change. [5]

The startup plans to use ATG-4 [6] coupled with Ka-band [7] technology to delivery connectivity. I helped the founders secure contracts with three major airlines for two flights each as a test run. What the startup does can be termed as data reselling. They will purchase mobile data from telecom companies at wholesale prices. [8] They have partnered with a company that manufactures the hardware and does the installation. Once an airline is onboard, it takes 13 days for the hardware to be installed. When that’s done, the airline can chose to add the price of wifi to ticket prices or let passengers buy it in-flight in a revenue sharing model with the startup.

airwifi

Image 1: Hardware schematic for ATG-4 tech. The hardware is bulky and adds weight to the aircraft, something all airlines go great lengths to avoid.

Image 2: ATG-4 antenne

Image 3: What a hardware pack for ATG-4 look like

Footnotes

[1] Indian air traffic continues to see double-digit growth | Travel Daily India

[2] Aviation soars with 25% growth in passenger traffic; IndiGo’s domestic market share hits almost 40%

[3] Home – Inmarsat

[4] Huge demand for in-flight WiFi, finds Inmarsat survey

[5] Airplane Wi-Fi Facts: Everything You Need To Know About What Connects You To The Ground

[6] Gogo ATG-4 – what is it, and how does it work?

[7] Ka band – Wikipedia

[8] airtel Global Data Solutions

[Guest post by Anurag Bhatia]

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