Surf Air Mobility secures $200m, in preparation for going public

Surf Air Mobility, a membership-based private operator, has secured $200m funding from Luxembourg-based alternative investment group, Global Emerging Markets Group (GEM), as it plans to go public on a mission to “bring private aviation to the masses”.

Whilst, Richard Koe, founder, WINGX, said the investment comes as good news for the business aviation industry challenged by Covid-19, it was not without significant risk he told Corporate Jet Investor.

“As much as I can build a a positive story about the investment, the fact remains it’s a gamble because we’ve seen so many other attempts to ‘democratise’ this specific area of private aviation. So far, to no avail and this segment has become the biggest graveyard of startups.” said Koe.

However, Koe thinks Covid-19’s demolition of scheduled services could create opportunity for firms like Surf Air to expand domestic connectivity offerings, as business aviation re-invents itself post-pandemic.

‘So many attempts to “democratise” private aviation’

“There are quite a few ‘alternative investors’ interested in business aviation. Why? Because on-demand aviation has come to be viewed as a necessity to reach certain destinations, especially in the US but also in Europe too. More than half the commercial flights are down and that is going to be very difficult to get back up. Meanwhile people still require point-to-point services.”

Koe continued: “What they need to do is consolidate this message, which is that business aviation is no longer about high net worth individuals buying private jets. That, in fact, it is a really important supplementary form of transport to get to certain locations, especially when it’s services that have withered on the vine due to the pandemic.”

The commitment comes with an advance of $50m, immediately available on the first day of trading. This provides Surf Air with substantial financial leeway compared with most companies in a similar position according to Koe.

‘Industry’s inevitable electrification’

In February the company acquired Blackbird, a marketplace for private aviation flights, that had ceased operation following investigation by the FAA. At that time Surf Air was renamed Surf Air Mobility, and the Blackbird title was retired. CEO Sudhin Shahani said that once the side of the business investigated by the FFA had been closed, shutdown he found the technology Blackbird had developed aligned with his vision for Surf Air Mobility.

“The launch of Surf Air Mobility Corp. and our acquisition of aviation marketplace, BlackBird, were the first steps in our original goal to bring the benefits of private aviation to the masses,” said Shahani.

“Now, we look to help drive the industry’s inevitable electrification, as that will play a critical role in making private travel accessible to all. The $200m commitment and $50m advance from GEM gives Surf Air Mobility the power to continue adding organic growth, executing strategic new initiatives, and acquiring leading technology players in the space.”

Meanwhile, Fred Reid, former Global Head of Transportation for Airbnb, has been appointed Surf Air Mobility’s new chief strategy officer. He said: “In recent years, electrification of automobiles and trucks has become nearly ubiquitous, whereas aviation is still at the starting blocks. Surf Air Mobility addresses this gap by assembling complementary elements which create a plausible and compelling path towards emissions-free flight in the very near future.”