Planet Labs, the San Francisco-based Earth imaging business that tracks daily changes on the surface of our planet and describes its products as “Bloomberg terminal for Earth data”, is to go public through a $2.8 billion Spac listing. The listing, expected to complete in the fourth quarter of this year, will see Planet Labs merge with NYSE-listed Spac (special purpose acquisition company) dMY Technology Group IV.
The agreement with dMY Technology Group IV will see Planet Labs raise total net proceeds of $434 million after transaction costs and paying down its debt. A Pipe financing deal led by Blackrock clients and also involving Google, energy and chemicals group Kock and Time Ventures, the investment vehicle of Salesforce founder Marc Benioff, will contribute $200 million to the raise with the rest coming from the Spac as part of the merger deal.
Pipe (private investment in public equity) financing involves institutional and other accredited investors buy stock directly from a public company below market price.
Planet Labs runs a constellation of small satellites that capture daily data on changes to the surface of the Earth. It was founded by three former Nasa scientists in 2010 and operates around 200 satellites carrying cameras and other sensors despite some not being much larger than a shoebox. The satellite constellation captures a new scan of the entire surface of the Earth every single day and is used to track data on farming, deforestation, natural disasters, infrastructure and even ship and plane numbers and positions.
The company’s core clients are governments and companies who need the data it provides to measure environmental and social goals.
Commenting on the announcement of the Spac listing being agreed, Planet Labs co-founder and chief executive Will Marshall said:
“Planet is ready to go out into the world and the world really needs Planet.”
Spac listings have recently become popular with space tech start-ups. Other recent announcements have included reverse acquisition mergers with Spacs by rocket builder Rocket Lab and Spire, a manufacturer of the kind of mini-satellites Plant Labs controls.
Virgin Galactic, set to make its first passenger flight to near space tomorrow, carrying founder Sir Richard Branson, was one of the first space companies to take the Spac-route to a public listing. Its share price has doubled this year, taking the company’s valuation to $11 billion.
Planet Labs will, however, be one of the first ‘public benefit corporations’ to go public via a Spac with agritech company AppHarvest becoming the first earlier this year. Public benefit corporations (B Corps) operate to the principle investors must allow the company to pursue social or environmental missions that may compromise financial results. Planet Labs will become a B Corp following its listing but has yet to reveal the precise details of its mission.
Co-founders Marshall and Robbie Schingler will retain control of the company despite their holdings falling below 50% through the listing by virtue of a dual-class share structure that will give their shares extra voting rights.
Planet Labs currently has over 600 customers and grew its revenues by 18% to $113 million last year. The money raised via its Spac listing will be used to fund the further development of the company’s sales and marketing department and to improve its software so it is easier for customers to use. The company has hired former Instagram and Twitter executive Keven Weil as its head of product and business and he will oversee the drive to improve the commercialisation of the company’s products.
As well as public sector clients, Planet Labs sells its data to defence and intelligence groups, mapping providers including Google, and agricultural companies. A net loss of $127 million was booked for the previous financial year and the company doesn’t expect to reach profitability before 2025.
Planet Labs has raised around $380 million in investment as a private company.