XTI Aircraft I Huge opportunity or another loser?(crowd-funding)

felixbocharov

felixbocharov

Hi guys,

I am considering the opportunity of investing some cash into XTI aircraft (currently investments are on hold since the company has to do some paperwork for SEC). Here are my reasons to do it:
  • XTI aircraft might change the way we fly - vertical takeoff and landing are the things which most probably will transform the way we fight forever. With such an airplane one can easily land almost everywhere - even in your yard! sSo you do not need runways anymore!
  • Huge market - personal aircraft transportation seems only to grow in the future, and it is evident that many CEOs and billionaires will crave a jet, which can be used not only for a long-distance transportation BUT even for regular commutes .
  • If technology is a success they might go further to the mass-market and who knows - they might even be the next Tesla of the aircraft industry.

However, I feel like I have a lack of knowledge in the sector, and I could miss something important, what do you think about it,? Is XTI aircraft worth investing? (Investments are temporary on hold ) I would really appreciate your thoughts.

Some sources
 
felixbocharov said:
Hi guys,

I am considering the opportunity of investing some cash into XTI aircraft (currently investments are on hold since the company has to do some paperwork for SEC). Here are my reasons to do it:
  • XTI aircraft might change the way we fly - vertical takeoff and landing are the things which most probably will transform the way we fight forever. With such an airplane one can easily land almost everywhere - even in your yard! sSo you do not need runways anymore!
  • Huge market - personal aircraft transportation seems only to grow in the future, and it is evident that many CEOs and billionaires will crave a jet, which can be used not only for a long-distance transportation BUT even for regular commutes .
  • If technology is a success they might go further to the mass-market and who knows - they might even be the next Tesla of the aircraft industry.

However, I feel like I have a lack of knowledge in the sector, and I could miss something important, what do you think about it,? Is XTI aircraft worth investing? (Investments are temporary on hold ) I would really appreciate your thoughts.

Some sources
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I've been flying since I was 16, owned a plane since I was 20, and was a professional pilot for many years, much of it flying helicopters and running aircraft maintenance programs. I'm also an entrepreneur who's started several companies and I'm generally very bullish on startups in general. However I wouldn't recommend you "invest" a dollar in this or any other aircraft startup, or in any company through a crowd-funding platform. If you're interested in this company, or any crowd-sourced company that you think is doing cool stuff and you'd like to support, then by all means throw some money in but look at it as a donation that gets you involved and is fun, not an investment.
On this specific company/product, both history and a basic knowledge of aircraft design, production, and sales will tell you that it doesn't have a chance. You need deep deep pockets and years of time to both build any aircraft and get it certified. If you're crowd funding, you don't have either. I could give you dozens of examples of similar ideas that looked great on paper but never panned out for more conventional aircraft, and if you look at the "successful" vertical thrust aircraft like the F-35 and Osprey you see huge engineering challenges far beyond what the engineers anticipated.
On crowd sourcing, if you don't fully understand how VC rounds and term sheets work, then you're not investing, you're donating. If the company you put money toward becomes successful, especially in a capital intensive industry like this one, they will need outside funding beyond what they can get from crowdfunding. Those providing this funding are professionals, and they'll cram down the initial crowd-funded investors as a condition for funding the round to the point that you'll effectively no longer own anything. I could elaborate if anyone cares, but suffice it to say there isn't anyone who got rich from crowdfunding a capital intensive company, in fact not sure there's anyone who got rich crowdfunding any company. Even pretty sophisticated angel investors who fund a seed round and initially owned 15-30% of the company routinely get crammed down to sub-percent range in subsequent rounds.
 
Sig said:
I've been flying since I was 16, owned a plane since I was 20, and was a professional pilot for many years, much of it flying helicopters and running aircraft maintenance programs. I'm also an entrepreneur who's started several companies and I'm generally very bullish on startups in general. However I wouldn't recommend you "invest" a dollar in this or any other aircraft startup, or in any company through a crowd-funding platform. If you're interested in this company, or any crowd-sourced company that you think is doing cool stuff and you'd like to support, then by all means throw some money in but look at it as a donation that gets you involved and is fun, not an investment.
On this specific company/product, both history and a basic knowledge of aircraft design, production, and sales will tell you that it doesn't have a chance. You need deep deep pockets and years of time to both build any aircraft and get it certified. If you're crowd funding, you don't have either. I could give you dozens of examples of similar ideas that looked great on paper but never panned out for more conventional aircraft, and if you look at the "successful" vertical thrust aircraft like the F-35 and Osprey you see huge engineering challenges far beyond what the engineers anticipated.
On crowd sourcing, if you don't fully understand how VC rounds and term sheets work, then you're not investing, you're donating. If the company you put money toward becomes successful, especially in a capital intensive industry like this one, they will need outside funding beyond what they can get from crowdfunding. Those providing this funding are professionals, and they'll cram down the initial crowd-funded investors as a condition for funding the round to the point that you'll effectively no longer own anything. I could elaborate if anyone cares, but suffice it to say there isn't anyone who got rich from crowdfunding a capital intensive company, in fact not sure there's anyone who got rich crowdfunding any company. Even pretty sophisticated angel investors who fund a seed round and initially owned 15-30% of the company routinely get crammed down to sub-percent range in subsequent rounds.
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Wow. This is a really awesome reply, thank you very much. Do you like some aircraft stocks?
 
felixbocharov said:
Wow. This is a really awesome reply, thank you very much. Do you like some aircraft stocks?
More...
I love flying but truthfully it's a really hard place to make money. I think Branson had it right when he said "If you want to be a Millionaire, start with a billion dollars and launch a new airline." My personal theory is that you have a bunch of super smart, type A engineers who become pilots. They all love aviation and pursue a career in it once they stop flying for a living, so you end up with a whole bunch of smart, accomplished individuals all battling it out, leading to a high level of competitiveness if you're looking at a Porter's 5 Forces analysis. So I try to invest in boring, arcane areas but I do have to keep slapping myself on the wrist and saying "no!" when I'm tempted to invest in the latest cool aircraft thing. That said, it would be fun to work in such a company if money/career were no object, maybe a post-retirement kind of job.
 
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