Connect Airlines has been quiet of late, but that does not mean the company has not been busy. As it continues to work with the FAA towards certification of its operations, the company also scored new funding, adjusted its organizational structure, and expects that a major US airline will buy in to the plan.
New funding plans
As the certification work stretches on the company continues to fund its operations through cash on hand and a small investment round, including a former JetBlue executive*. Once it receives FAA approval to operate, the company plans a $40 million Series B equity raise to fund operations through its first year. As part of that funding round the company asserts a “major U.S. airline will become a shareholder in Connect with the stated intention of taking a larger position over the next three years.”
This is the same major airline with which the company has signed a MoU for significant commercial operation, American Airlines.
Connect is also working to secure grants and loans from the US Department of Energy related to its plans for converting ATR72 aircraft to hydrogen power. Connect expects the grant to support “deployment of infrastructure necessary to establish a marketplace with large commercial-scale production of clean hydrogen.” The loans would “fund not only Connect’s proposed acquisition and operation of hydrogen-powered aircraft but also its initial launch aircraft, the De Havilland DHC-8-400.”
Certification Progress
Connect submitted a revised copy of its operations manuals on July 31st, the latest step in it path to FAA certification. Assuming the FAA certifies the revised copies, Connect must perform additional proving runs to complete the certification process. The carrier anticipates completion “during the fall of 2023” but requested an extension of its application through the end of the year.
Org Structure Shuffle
Connect’s Chief Operating Officer Dave Marcontell is no longer with the company. CEO John Thomas “now has all operating groups reporting directly to him making for a flatter organization structure.” Connect points out that this same structure was used at the much larger Virgin Australia when Thomas was CEO there.
The full filing from Connect Airways/Waltzing Matilda can be found here.
*Easwaran “Eash” Sundaram served as an EVP and CTO at JetBlue. He founded the company’s venture capital group JetBlue Tech Ventures. He now serves as an operating executive at Tailwind Capital and serves on the Board of Directors for Intelsat. He is reported to have invested $100,000 in the latest $1.15mm SAFE pool.
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