Spacetalk Ltd. (formerly known as MGM Wireless) is an Australian technology company headquartered in Adelaide, South Australia.
| Company type | Public company |
|---|---|
| ASX: SPA | |
| Industry | Information technology |
| Founded | 2001 |
| Headquarters | Rose Park, South Australia, Australia |
Area served | Australia, United Kingdom, New Zealand, United States |
Key people | Simon Crowther (CEO) |
| Revenue |  A$15.12 million[1] (2021) |
 A$−1.78 million[1] (2021) | |
| Website | spacetalkwatch |
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 Gujurat.[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 $A 45m.[23]
The company’s European, UK American retail bricks and mortar footprint included over 2,000 stores including retail and mobile telco partners such as Best Buy (USA), Sky Mobile, O2, Telefonica, Virgin Mobile and other Nordic operates such as Elisa, Telia and others.[24] where it was considered the market leading children’s connected wearable device.[25]
Corporate affairs
In August 2021 the Spacetalk Shareholders Group (SSG) was formed by several generally non-associated Spacetalk shareholders. The SSG members work to share common concerns about the impacts of adverse governance and management of Spacetalk and are working to engage the company to improve the company for all co-owners.[26]
Board of directors
The company is run by a board of directors made up of most company outsiders, as is customary for publicly traded companies. Members of the board as of July 2022 are Georg Chmiel, Mark Fortunatow, Martin Pretty, Dr Brandon Gien, Saurabh Jain, Mike Rann.[27]
Financial
| Year | Revenue in mil. AUD$[28] | Net income in mil. AUD$[28] |
|---|---|---|
| 2018 | 2.74 | -1.12 |
| 2019 | 7.14 | -4.68 |
| 2020 | 10.48 | -4.26 |
| 2021 | 15.12 | -1.78 |
| 2022 | 20.7 | -6. |
| 2023 | 13.4 | -14.5 |
As of January 31, 2024, the company’s substantial shareholders include Thorney Investment Group, whose Chairman is Alex Waislitz[29] which has a 22.8% voting power in the company.[30][31]
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 [32]
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[33]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.[34]
The resolution was overwhelmingly rejected by shareholders.[35]
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.[36]The Spacetalk board appointment Saurabh Jain as the Acting Chief Executive Officer while the search for a new chief executive officer was underway.[37]
On October 14, 2022 Mark Fortunatow resigned as a Director.[38]
Simon Crowther, CEO Appointment
On 3 February, 2023 the company appointed Simon Crowther as CEO and Managing Director.[39]Simon Crowther was responsible for changing the key focus of the companies growth to becoming a re-seller of Telstra mobile network services.[40]
On February 10, 2023, Mark Fortunatow sold his 16% substantial shareholding in the company,[41]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.[42]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.[43]
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. [44]