Spacetalk

Last updated

Spacetalk
Company type Public company
ASX:  SPA
Industry Information technology
Founded2001
Headquarters Rose Park, South Australia, Australia
Area served
 Australia, United Kingdom, New Zealand, United States
Key people
Simon Crowther (CEO)
RevenueIncrease2.svgA$15.12 million [1] (2021)
Decrease2.svgA$−1.78 million [1] (2021)
Website spacetalkwatch.com

Spacetalk Ltd. (formerly known as MGM Wireless) is an Australian technology company headquartered in Adelaide, South Australia.

Contents

The company's education division provides school-to-home communication for absence management, news and emergencies [2] using SMS, apps and cloud based technology.

History

MGM Wireless was founded in 2001 by Mark Fortunatow, Greg Sincock and Mark Hurd, who lent their initials to the name of the company. Mark Fortunatow was CEO and drove the company's sales, product development and business activities for a 21-year period from 2001 until 2022, whilst Mark Hurd drove product development.

Following coverage by local and international media in late 2003, their messageyou service became part of a state government solution to solving truancy in South Australia. [3] During 2004 and 2005, MGM Wireless services were made available nationally. [4] In 2005, MGM Wireless began to roll out services internationally, with trials in New Zealand. In 2006, trials began in the United States city of Tucson, Arizona. [5] In 2007, further trials began in the Indian city Ahmedabad, the capital of Gujura t. [6] In 2007, MGM Wireless signed a major, whole of state contract with the Western Australian Education Department for more than 800 schools. [7] In 2010, MGM Wireless won preferred supplier for 400 schools in New Zealand. [8] In 2011, MGM Wireless expanded into the childcare market across Australia and in New Zealand. [9]

In 2015, Mark Fortunatow identified the emerging wearable device market, and drove the company's expansion into the category of connected wearable watched for children as a logical expansion to the school messaging business. [10]

The development process for Spacetalk was funded entirely from the MGM Wireless school messaging business, which remained profitable throughout the development period, reporting a 2015 net profit of $1.04m in 2015, and $0.5m in 2016. [11]

In September 2017, MGM Wireless launched its Spacetalk brand of family location and child safety wearable devices. The Spacetalk watch is a combination of mobile phone and watch which allows parents to locate their children using mobile phone bandwidth devices. [12] [13] The device features no open access to the Internet, social media and apps. [14] Since launching the Spacetalk watch, it has won an Australian good design award [15] and is now available via the Qantas store, [14] and over 800 leading retailers in Australia and New Zealand. [15] MGM officially launched the product in the UK market in May 2019 [16]

In 2017, Mark Hurd passed away, and according to his wishes, his family sold his shares in the company and bequeathed the proceeds to his school, Westminster Schools, which used the funds to build the Hurd Design Laboratories, a superb facility across three levels to deliver science, psychology, engineering, IT and digital technology, fashion design and other related education. [17]

Mark Hurd established the funding for the Mark Edwin Hurd Memorial Scholarship at Adelaide University. [18]

The company changed its name from MGM Wireless to Spacetalk Ltd. on 12 November 2020, to reflect its primary focus, which is to develop and commercialise innovative wearable devices. [19] [20]

Spacetalk Children’s Wearable device

The Spacetalk watch grew to become a successful business, with the company's revenues growing seven-fold from $2.62m in 2017 [21] to $20.7m in 2022. [22] During this period, the company's share price increased from 3 cents to 45 cents, and market capitalisation from approximately $A 3m to $A 45m. [23]

The company's European, UK American retail bricks and mortar footprint included over 2,000 stores including retail and mobile telco partners such as Best Buy (USA), Sky Mobile, O2, Telefónica, Virgin Mobile and other Nordic operates such as Elisa, Telia and others. [24] where it was considered the market leading children's connected wearable device. [25]

Corporate affairs

Shareholder Association

In August 2021 the Spacetalk Shareholders Group (SSG) was formed by several generally non-associated Spacetalk shareholders. The SSG members work to share common concerns about the impacts of adverse governance and management of Spacetalk and are working to engage the company to improve the company for all co-owners. [20]

Board of directors

The company is run by a board of directors made up of most company outsiders, as is customary for publicly traded companies. Members of the board as of July 2022 are Georg Chmiel, Mark Fortunatow, Martin Pretty, Dr Brandon Gien, Saurabh Jain, Mike Rann. [26]

Financial

YearRevenue

in mil. AUD$ [27]

Net income

in mil. AUD$ [27]

20182.74-1.12
20197.14-4.68
202010.48-4.26
202115.12-1.78
202220.7-6.
202313.4-14.5

Major Shareholder

As of January 31, 2024, the company's substantial shareholders include Thorney Investment Group, whose chairman is Alex Waislitz [28] which has a 22.8% voting power in the company. [28] [29]

Controversies

On July 25, 2021, it was reported that the former global sales directory Ian Hume would be taking legal action in the Federal Court against Spacetalk. Hume was allegedly fired via text message after repeatedly warning the company about its stock issues and that it was losing the trust of its business partners because it could not provide product. Spacetalk has not commented on the allegations and legal action remains pending [30]

On July 5, 2022, Spacetalk was served with a Section 249D Notice by Peter Julian Cossetto, a former director of failed company Australian Mortgage Finance Limited (ACN 615 711 772) Administrator Appointed [31] on behalf of Merewether Capital Management Pty Ltd as Manager of Merewether Capital Inception Fund, Harry Basle, Ian Cameron, Lindsay Cardno, Mitchell Cardno, Peter Cossetto & Annamaria Cossetto ATF Cossetto Family Superannuation Fund, Coz-E Pty Ltd ATF Cossetto Family Trust, Mark Gately, Savvas Ioannou & Maria Ioannou, Matthew Payne, Lasse Petersen and Lasse Petersen ATF the Icebear Trust and Neil Page being shareholders claiming to hold at least 5% of the shares in the company to call for a general meeting and proposed a resolution for the removal of three directors of the company: Mark Fortunatow, Georg Chmiel and Michael Rann. [32]

The resolution was overwhelmingly rejected by shareholders. [33]

On October 10, 2022, Spacetalk terminated the employment contract of Mark Fortunatow, Founder, chief executive officer with his declining health believed to be the underlying reason. [34] The Spacetalk board appointment Saurabh Jain as the Acting Chief Executive Officer while the search for a new chief executive officer was underway. [35]

On October 14, 2022, Mark Fortunatow resigned as a Director. [36]

Simon Crowther, CEO Appointment

On 3 February 2023 the company appointed Simon Crowther as CEO and managing director. [37] Simon Crowther was responsible for changing the key focus of the companies growth to becoming a re-seller of Telstra mobile network services. [38]

Mark Fortunatow Sells Shareholding

On February 10, 2023, Mark Fortunatow sold his 16% substantial shareholding in the company, [39] ending his and all other  founder involvement in the company.

Closure of Spacetalk International Operations

In March 2023, the company announced closure of all its successful international operations, namely Europe, UK and USA, which at June 2022 accounted for 40% of its revenues and growing at over 30% annually. [40] Spacetalk's exit from the European and UK market enabled is closest competitor at that time in those markets, Xplora Technologies to significantly grow sales from 18,000 devices in 2021 to over 250,000 devices in 2023 and become the market leader. [41]

Business Re-structure Strategy

On May 10, 2023, the company announced a business ‘turn-around’ strategy centred around Jumpy SIM card sales, a focus on Australian and New Zealand Sales only and the rebranding all products, including the MGM Wireless school messaging service to Spacetalk. The Jumpy SIM income was to be called Annual Recurring Revenue or ‘ARR’, a term normally only used for Software as a Service monthly subscription revenue. [42]

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References

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  2. ↑ HINDE, SUELLEN (6 June 2005). "Text messages to stop kids wagging". Northern Territory News.
  3. ↑ Doherty, Linda (22 May 2004). "Y is your child wagging school 2dA?". Sydney Morning Herald.
  4. ↑ Matas, Kimberly (13 August 2006). "Kids' Truancy to Prompt Text Message to Parents". Arizona Daily Star.
  5. ↑ "Savvy text to nab Indians". Melbourne Herald Sun. 11 April 2007.
  6. ↑ "MGM Wireless offers Cloud to schools". Computerworld. Retrieved 14 May 2017.
  7. ↑ "MGM wireless signs." (PDF).
  8. ↑ "MGM Wireless offers Cloud to schools". Computerworld. Retrieved 14 May 2017.
  9. ↑ "The kid-friendly smartwatch designed to keep youngsters safe". www.9news.com.au. Retrieved 10 December 2017.
  10. ↑ "MGM wireless launches new revenue stream" (PDF).
  11. ↑ "consolidation completed with successful..." (PDF).
  12. ↑ "Helicopter parents to double MGM revenue with child-tracking smartwatch - Stockhead". Stockhead. 20 September 2017. Retrieved 10 December 2017.
  13. ↑ "Helicopter parents to double MGM revenue with child-tracking smartwatch - Stockhead". Stockhead. 20 September 2017. Retrieved 10 December 2017.
  14. 1 2 "SPACETALK SP-1005T Kids Smartwatch, phone & GPS Device". Qantas Store. Retrieved 4 November 2019.
  15. 1 2 Changarathil, Valerina (22 August 2019). "Adelaide Company MGM Wireless Revenue Soars on Spacetalk Sales". www.adelaidenow.com.au. Retrieved 4 November 2019.
  16. ↑ Spence, Andrew (18 November 2020). "Name change to help Adelaide tech company walk the talk". InDaily. Retrieved 24 November 2020.
  17. ↑ "Old Scholar News - Edition 16 - 2022". Westminster School. Retrieved 2 February 2024.
  18. ↑ "Mark Edwin Hurd Memorial Scholarship | University Scholarships". scholarships.adelaide.edu.au. Retrieved 2 February 2024.
  19. ↑ Spence, Andrew (18 November 2020). "Adelaide tech co MGM Wireless rebrands as Spacetalk". Startup Daily. Retrieved 22 November 2023.
  20. 1 2 "Spacetalk Shareholders Group". Spacetalk Shareholders Group. Retrieved 9 August 2022.
  21. ↑ "2017 Annual report" (PDF).
  22. ↑ "Preliminary final report" (PDF).
  23. ↑ "2017 Annual report." (PDF).
  24. ↑ "SpaceTalk ltd annual report".
  25. ↑ "2017 financial results".
  26. ↑ "Corporate Governance - SPACETALK". Spacetalk. 2 July 2022. Retrieved 8 July 2022.
  27. 1 2 "SPA - ASX". www2.asx.com.au. Retrieved 7 July 2022.
  28. 1 2 "Board Of Directors – Thorney" . Retrieved 2 February 2024.
  29. ↑ "change of interest of special shareholders".
  30. ↑ Martin-Guzman, David (25 July 2022). "MGM Wireless plagued by 'severe' smartwatch shortages, exec claims" . Retrieved 17 July 2022.
  31. ↑ "Rapsey, in the matter of Australasian Mortgage Finance Limited (Administrator Appointed) [2021] FCA 189 (9 March 2021)".
  32. ↑ "Section 249D Notice". ASX. 5 July 2022. Retrieved 17 July 2022.
  33. ↑ "Results of extra ordinary general meeting 2022".
  34. ↑ "ASX announcement update." (PDF).
  35. ↑ "Fortunatow terminated as Spacetalk CEO". itwire.com. 10 October 2022. Retrieved 13 October 2022.
  36. ↑ "Further Leadership Update". ASX. 10 November 2022. Retrieved 28 November 2022.
  37. ↑ "Spacetalk appoints new CEO" (PDF).
  38. ↑ "Annual general meeting addresses and presentation" (PDF).
  39. ↑ "Form 65".
  40. ↑ "4QF2022 Update".
  41. ↑ "Xplora Technologies AS – Invitation to presentation of Q3 2023 results". Xplora UK. 23 October 2023. Retrieved 2 February 2024.
  42. ↑ "Stabilisation and growth strategy" (PDF).
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