Chet Kanojia, CEO and Founder of Aereo Inc.
Adam Jeffrey | CNBC
In this weekly series, CNBC will cover the companies that created the first Disruptor 50 list 10 years later.
This is one of my favorite moments in the history of the Disruptor 50 list.
Tuesday, June 17, 2014.
Aereo, a web-based TV subscription service startup The second list has been named.. Although ranked 7th on the newly ranked list, he faced an existential crisis in the Supreme Court. Trying to rule a copyright infringement proceeding It was opposed by major broadcast networks.
Aereo Founder and CEO, Chet Kanojia, Appeared on CNBC’s “Squawk Box” And Julia Boorstin asked, “What if (the incident) didn’t benefit you?”
Canozia replied, “I don’t know.”
The stunned Andrew Ross Sorkin jumped in. “Is that a bargaining stance?” He asked. “That is to tell the world that we don’t have Plan B …. If you really did, we could do it this way and the judge said it wasn’t good. If so, we can do it another way. Are you saying there is no way? How to do this the other way? “
“The point of Aireo was to create a free open platform,” Kanojia replied. “And if we don’t succeed in doing it, we won’t succeed in doing it.”
In less than two weeks, it turned out that Canodia was 100% honest.supreme court Rules for AereoAnd by October 2014, a start-up company that raised $ 97 million from investors, especially IAC Chairman Barry Diller, filed for bankruptcy and sold scrap for less than $ 2 million.
But less than seven years later, Canozia is on the verge of bringing her next move to the public market. After all, he had some kind of Plan B for himself and his team in case Aereo shuts down. He founded a new company called Starry. It provides home customers with more affordable wireless internet services. If Aereo was alive, Starry would have been a companion product to the Aereo platform.
“Basically the same group of people continue to travel,” Canozia told me in an interview this week. He was relaxed, confident in the new venture, and looked very thoughtful about the lessons he had from Aereo’s experience.
We often hear from Silicon Valley celebrities that failure is an important element of innovation, but we rarely see failure on public displays like we saw in Aero. But this was another kind of failure. It wasn’t the fault of the fraudulent founder, but the product that didn’t work as promised, the runaway spending, or the lack of customer demand.
“We entered [to Aereo investor meetings] “We say this is an alternative risk, like a drug discovery company, and with FDA approval, it would be very successful,” said Canozia. If not, it is not. And it seems 50% likely to get FDA approval. I had a tradition. We sign the paperwork, wait a day, then call the investor again and say, “Are you sure you want to do this?” Before cashing the check. Because binary risk was still there. “
Canozia admits that Aero may have done something else to save herself.
“I didn’t expect how soon I would arrive at the Supreme Court. I wanted a short fuse, fast yes / no, go / no, but I still thought it was 3-4 years, not a bloody 18 months. . “”
If we had the time, Kanozia would have had the opportunity to lay a larger foundation for our loyal customers. And he says it was a “big mistake” that didn’t launch in Washington, DC before the case was brought to the Supreme Court.
“If we launched in DC and all the clerk of these judges and the people who were part of the machine could access the product, they would have built some affinity for it. [the Supreme Court decision] There was no basis in any legal debate, which was basically “we don’t like Aereo”. There was no factual basis. “
Looking back on Aero’s victory more than failing, Canozia said her overall experience allowed her to maintain a level of trust with investors and rebound quickly.
“The fact that we ran Aereo and people saw this team run ended in 18 months and now has 600,000 users and 120,000 customers while fighting a legal battle. We had a beautiful product that worked well. A stage that the team can perform. “
October, Starry Firstmark Horizon Acquisition Corp.. , SPAC supported by FirstMark Capital. FirstMark Capital is a key investor in Aeroseed Round and reunited with Canozia in 2016 to lead Starry’s Series B round financing. The deal, which is reported to be worth $ 1.6 billion for Starry, is expected to close by the end of the quarter.
Unlike Aereo, Starry’s future success is not based on a set of risk binaries. Instead, it relies on expanding its loyal customer base, not only for its customers, but also for its wireless spectrum, while overcoming fierce competition with competitors with much deeper pockets.
Canodia doesn’t seem to care. “They weren’t competitors in the days of Aero,” he smiled. “They were just enemies.”
CNBC is currently accepting nominations for the 2022 Disruptor 50 list. It sees every year private innovators using breakthrough technology to transform the industry and become the next generation of great public companies. Submit a recommendation Until 3:00 pm Eastern Standard Time on Friday, February 4th.