Space Elevator Company LiftPort In Trouble

TropicalCoder writes "The LiftPort Group, founded four years ago with the lofty dream of building a stairway to heaven, has seemingly reached the end the line. The dream was to develop a ribbon of carbon nanotubes 100,000 km long, anchored to the Earth's surface and with a counterweight in space, providing a permanent bridge to orbit. Elevator cars would be robotic 'lifters' which would climb the ribbon to deliver cargo and eventually people to orbit or beyond. Now LiftPort has all but run out of funds, and the State of Washington's Securities Division has entered a Statement of Charges (PDF) against LiftPort Inc. dba LiftPort Group and founder Michael Laine."

Comments

Hah.

[daeg]

Lesson: You don't offer "common stock" to people without following detailed securities regulations and laws. In fact, you don't mention that at all until you've consulted with people that know of these things. The president of Liftport obviously never took an Economics class where you would have learned at least that the whole stock system is very complicated and very regulated.

Good call, Washington (state). Sucks for the idea, though.

Re:Hah.

[glenstar]

he... a prospectus that I used for one of my companies was 37 pages long. The first 10 or so pages were the legal boiler plate (ie... "YOU HAVE A 99.999% CHANCE OF LOSING YOUR MONEY"), followed by a few more pages of definitions. The next 10 or so pages were full of core business info (company overview, product(s) overview, executive bios). 5 or so pages were full of financial and the remaining pages were essentially a rehash of the "YOU WILL LOSE YOUR MONEY". It was embarrassing to be in the presence of a potential investor while they read through it.

Investor: "What does it mean, 'The Company's methods and operations are unproven'?"
Me: "That means we are a startup and have not been in business very long."
Investor: "Ok. What about: 'The Company's products and services may never make it to market'?"
Me: "Well, we can't guarantee that our services and products will ever sell"
Investor: 'Hm. What about: 'The Company cannot guarantee that its products and services will be able to compete with its established competitors'?"
Me: (Twitching uncontrollably and muttering something about first to market)
Investor: "So, it sounds to me that what you are looking for is someone to put money into an unproven company, that may never actually bring a product to market, and that if you do somehow manage to bring it to market, no one may care. Does that sum it up?"
Me: "Er..."
Investor: "Do I have the word 'DUMBFUCK' tattooed on my forehead?"
Me: "Err... no (under breath: fucking lawyers!)".

I understand the whole concept of not allowing companies to make absurd claims that ignorant sheep will buy into to, but having to essentially emasculate your company is, well... emasculating.

Blue Sky Laws

[whackco]

Well I would be interested to know how the State of Washinton came to these conclusions and charges. Blue Sky laws are put into place to protect un-savy investors from being taken by kinky investment opportunities, but the charges don't seem to translate into a direct blue sky violation, and at worst, seems to stem from his lack of registering with the State that he would be selling securities.

They mention that he sold to un-accredited investors, but this is allowable under Regulation D, assuming he didn't take more then $1M and that the people he took money from were previous business associates, friends, or family.

I think this boils down to an angry Washington resident that put money into this 'venture' and lost it, and now is angry.

Re:What if it falls?

[ptbarnett]

This issue is addressed in the Wikipedia entry for Space Elevator, with a reference to a simulation.

It makes a good disaster story, but analysis shows that only significant danger is to anyone that happened to be on the elevator at the time.