Mars Exchange
Why is going public such an important step for Mars One?

Why is going public such an important step for Mars One?

by Suzanne Flinkenflögel on Tuesday, 8th November 2016 in Inside 360

Earlier this week, Mars One announced that a takeover agreement was signed between Swiss company InFin Innovative Finance AG [FRA:KCC] (“InFin”) and all shareholders of Mars One Ventures PLC (“Mars One Ventures”) to become listed at the Frankfurt Stock Exchange (read the press release here).

Following the announcement, we’ve received several questions about what this means for the mission, and why Mars One has chosen this funding route for our mission to Mars. Below we will further explain some important aspects of the agreement and explain why this is such an important step for Mars One.

What’s the difference between the Mars One Foundation and Mars One Ventures?

Mars One consists of two entities: the not-for-profit Mars One Foundation and for-profit company Mars One Ventures. The Mars One Foundation implements and manages the mission and owns the mission hardware. It also selects and trains the crews, and is building an ever growing community of experts and fans that follow the progress of the mission and contribute to it. The Foundation has transferred all global monetization rights to Mars One Ventures to be able to attract investments to successfully kickstart the mission. Revenue streams for Mars One Ventures are sales of merchandise, ads on video content, broadcasting rights, brand partnerships, Intellectual Property, and many others.

For the Mars One Foundation, taking the mission closer to successful completion step by step is the only important goal. To make sure that the interests of the Mars One foundation and Mars One Ventures (hence investors) are aligned, a funding structure was developed that ensures that both entities mutually benefit from each other's success. Read more about this here: What is Mars One’s funding model?

Does Mars One already have enough funding for the next steps in the mission?

One of Mars One’s main challenges has been securing enough funding to move the mission forward at the pace as presented in our Roadmap. A successful listing will help tremendously in fundraising. This provides us an opportunity to accept both small and large investments on a large scale.

Around the listing we’re in the process of a private placement round and we’ve already welcomed some new shareholders. We expect to get more investors on board before listing as we’ve already received interest for some substantial amounts of investments.

Being listed on a stock exchange makes fundraising more straightforward. After all, the price per share is determined by the market. With the share price known, Mars One can (after shareholder approval) create new shares and offer them to the market, or can place a large batch of shares directly with an investment firm.

How will Mars One use new funding to progress its mission to Mars?

Mars One Foundation will use the funding to move the mission forward. The most important first steps are:

  • Award new contracts to suppliers. Mars One's mission design is currently in the early mission concept phase, or as called in space development terms: Phase A. In this phase, suppliers with relevant experience will be contracted to perform conceptual design studies for every major (sub)-system required for the permanent settlement mission.
  • Organize the next round in the astronaut selection process. The first two rounds have already been successfully completed: one hundred Round 3 candidates remain. Mars One is currently preparing for Round Three and Four. The design for the next rounds is ready and the next steps are determining the locations and dates, expanding the team of selection and training specialists, and logistics.
  • Hire team members with experience in implementing Mars missions, and crew selection and training.

For more information about the next steps, also read Current Mission Status.

Why is a stock listing good news for the mission?

The Mars One team is very excited about this deal, for several reasons:

  • The listing will help Mars One in fundraising, as the price per share will be determined by supply and demand in the market. This means that the value is not set by Mars One or a prospective investor, but by the market itself. It is the price that investors are willing to pay for projected future earnings. The decision to actually buy a share will therefore not merely depend on how much someone supports Mars One, but how much an investor actually believes his or her shares are and will be worth. The market force of this process of many investors together, makes the determined stock value and therefore value of the company a lot more objective. With the share price known, Mars One can create new shares (after shareholder approval) and offer them to the market, or can place a large batch of shares directly with an investment firm.
  • The initial investments through the listing will accelerate mission progress. We've already received interest from a number of investors and we expect to be able to announce quite some exciting mission news updates in the months that follow!
  • Being listed at the renowned Frankfurt Stock Exchange will add significantly to Mars One's credibility. There are very strict rules and regulations to be listed there, and only trustworthy companies are accepted. Stock exchange listed companies need to report their finances in detail, so it also gives investors and supporters the ability to check what Mars One is doing.
  • It will make it possible for our supporters anywhere in the world to be part of this adventure and to actually own a piece of our historic venture.

Does this takeover agreement mean that Mars One is already listed?
The acquisition is subject to customary closing conditions, including InFin shareholder approval of the agreement and due diligence. The extraordinary shareholder meeting of InFin will take place on the 2nd of December 2016. The board of InFin has received irrevocable commitments for over 70% of the voting shares of InFin to agree to the acquisition at the shareholder meeting.

Why become listed through a takeover instead of listing Mars One Ventures directly?

Mars One has been working on several funding routes to be able to accept investments but this route is by far the most cost effective way for us to be listed on Europe’s leading exchange for fast growing, smaller companies.

Does Mars One Ventures have a prospectus?

Every stock listed company needs to have a prospectus. Mars One Ventures will amend the existing InFin prospectus to a Mars One Ventures prospectus.

Is it already possible to buy Mars One Ventures shares?

The acquisition is subject to customary closing conditions, including InFin shareholder approval of the agreement. The extraordinary shareholder meeting of InFin will take place on the 2nd of December 2016. Until then it is possible to purchase InFin shares at the Frankfurt Stock Exchange [FRA: KCC] ISIN; CH0132106482. If all goes well at the shareholder meeting, they will be renamed to Mars One Ventures shares on December 2nd. If you are not an experienced investor, we recommend you seek professional advice.

According to Mars One’s funding model, 5% of Mars One Venture’s revenue goes to the Mission, is 5% enough?

For the Mars One Foundation, taking the mission closer to successful completion is the only important goal. To many investors in Mars One Ventures however, a positive return on their investment may be more important than the actual mission success. It would be impossible for Mars One to raise capital without a viable business case that projects a solid return on investment. The 5% revenue share over gross revenue (not profit!) is a good balance between a good ROI for investors and enough money flowing back into the Foundation. Mars One's business case projection supports at least double the mission budget estimates.

Next to the license fee, the Mars One Foundation also receives donations from all over the world from individuals that support our human mission to Mars. Our historic data shows that with every step we have taken to date, like contracts with aerospace companies or next rounds in the selection process, more people start donating and the average amount goes up. We expect that by the time send our first unmanned mission, donations will contribute significantly to mission expenses.

Is Mars One just a marketing plan in disguise?

Mars One’s goal is establishing a permanent human settlement on Mars. Monetizing the mission will play an important role to generate revenues to actually finance the mission. So will donations. If private donations alone would be enough to completely fund the mission that would be great but it is not realistic to count on only one revenue stream. Traditional mission plans often rely on governmental funding, but with political changes and budget cuts, there are no concrete current human Mars mission plans.

As a private organization, Mars One does not rely on governmental funding. If we want to accomplish our goal to settle Mars, a realistic and inventive business model is required. In other industries, commercializing exciting stories have proven to successfully generate a lot of revenue without making the story any less exciting. Take the Olympics for example: billions of dollars are generated on broadcasting rights and sponsorships alone, but as a viewer you only care about ‘your’ athletes and the amazing accomplishments they're achieving. Are their individual performances any less exciting because the for-profit organization behind the Olympic Games is generating money around sharing the athletes’ stories with the world?

Also read how Mars One adviser and NASA’s former Chief Technologist Mason Peck comments on this topic: Is broadcasting the human Mars mission as entertainment opening up moral risks?

What will the Mars One team look like after the stock listing?

The existing Mars One team members as presented on the Mars One team page will continue in their current position, with Bas Lansdorp as the CEO of the Mars One Foundation. The current CEO of InFin Prof. Moritz Hunzinger, will be the interim CEO of Mars One Ventures. Mars One is looking for a new CEO for Mars One Ventures with a proven track record in growing start up companies and leading established media content companies.

To make sure the goals of the Mars One Foundation and Mars One Ventures are aligned, two of the three board members of Mars One Ventures will be Mars One Foundation team members. Bas Lansdorp will be appointed as Chairman of the Board of Directors of Mars One Ventures. Further Members of the Board of Directors will be Prof. Hunzinger, InFin's current CEO, and Suzanne Flinkenflögel, Director of Communications of the Mars One Foundation.

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