Amidst uncertain merger with Woz's Privateer Space, Orbital Insight CEO Kevin O'Brien bails to cryptocurrency surveillance firm Chainalysis
After the collapse of Orbital's commercial business and pivot to Indonesia, Orbital was ordered to pay $2.2 million for defaulting on its rent and its main phone hasn't functioned for five months.
2024-05-06: Reuters confirmed this publication's reporting on Orbital's planned acquisition by Privateer, albeit more than six months later, with no with no credit and no discussion of Orbital’s primary funding source becoming Indonesia’s State Intelligence Agency.
With the public transition of CEO Kevin E. O’Brien to President of the Government Solutions division of cryptocurrency surveillance firm Chainalysis on Tuesday, the collapse of pattern-of-life analysis company Orbital Insight is effectively complete. Roughly three weeks ago, on January 22, Orbital was ordered by Santa Clara County courts to pay $2.2 million to its Palo Alto landlord after defaulting on its roughly $370,000 per month rent. The company’s main phone line has also been nonfunctional for at least the last five months, and Orbital has attempted to salvage the company through a possible merger with Privateer Space, a Hawaii-based space-debris-tracking company co-founded by Steve Wozniak which has branded itself as a bastion of “space environmentalism”.
According to documents obtained by the author, Orbital planned to merge with Privateer into a company initially valued at $90 million in late December 2023 or January 2024 alongside a $30 million Series A fundraising round for Privateer led by Aero X Ventures, a space-focused venture capital firm headed by a former Chief Financial Officer of Domino’s Pizza, David Mounts. Orbital, Privateer, and Aero X Ventures did not respond to requests for comment on the status of the planned merger or on Privateer’s planned Series A round, even with two weeks’ notice.
Despite having raised more than $130 million in investments from flagship organizations such as Google’s GV and the U.S. Intelligence Community’s In-Q-Tel, Orbital began its financial freefall in January of last year through a series of emergency fundraising rounds which devalued its “liquidation preference stack” — essentially the order and amount investors are paid in the event of a bankruptcy — down to just one tenth of its previous $200 million amount.
Orbital’s difficulties arguably stemmed from the degradation of the commercial cellphone location-tracking data market in the wake of Apple introducing its App Tracking Transparency requirements and family safety application Life360 cutting off its data brokerage activities. As revealed by the author in a series of articles based upon leaked investor presentations, Orbital responded to the challenge by shifting the bulk of its income to a secretive contract with Indonesia’s State Intelligence Agency — known as the BIN — and Singapore-based surveillance contractor Grandrich Corporation, which it codenamed “Project Alpha”. According to a former employee, Project Alpha involved Orbital helping the BIN fuse together myriad surveillance data sources, including satellite imagery and “full untethered access” to cellphone location data, particularly in the politically contested region of West Papua.
In addition to its work with the BIN through Project Alpha, O’Brien claimed in his September 2023 investor presentation to be in active talks with the militaries of: Singapore, Israel, Ukraine, Taiwan, Qatar, Saudi Arabia, the UAE, Thailand, and Vietnam. O’Brien’s slide also claimed that the UAE military’s “Emirati [surveillance] leads” were a “strong HawkEye 360 customer", in reference to Orbital’s partner, satellite-based radio-frequency surveillance company HawkEye 360. Later the same month, the Pentagon announced that HawkEye received a $12.25 million contract routed through Naval Information Warfare Pacific (NIWC Pacific), with $6.5 million deriving from Foreign Military Sales to the governments of Indonesia, Malaysia, Philippines, and Thailand, and the remaining $5.75 million coming from the State Department’s Bureau of International Narcotics and Law Enforcement Affairs (INL).
While HawkEye 360, NIWC Pacific, and the State Department’s Defense Security Cooperation Agency have so far not responded to requests for comment on which government agency in Indonesia HawkEye’s products were sold to, INL stated that it “supports the [Biden] Administration’s efforts to enhance maritime domain awareness by bringing cutting-edge technology to the Pacific Islands under the Quad-supported Indo-Pacific Partnership for Maritime Domain Awareness (IPMDA) initiative, as announced at the 2023 U.S.-Pacific Islands Forum Summit.” According to the White House’s September 2023 announcement, IPMDA involves cooperation with the Pacific Islands Chiefs of Police’s Pacific Transnational Crime Network.
Mr. O’Brien’s new role as head of the Government Solutions division of Chainalysis drops him into the middle of numerous multi-million dollar contracts with U.S. law enforcement agencies, including an ongoing, five-year, $25 million ceiling agreement with the FBI’s ‘Division 1600’ — the Criminal Investigation Division — which has so far paid out $13.2 million.
Apple’s privacy constraints apparently contributed to the downfall of Orbital’s commercial pattern-of-life analysis business, but it seems increasingly unlikely that Apple co-founder Steve Wozniak’s “space environmentalism” company Privateer will follow through as Orbital’s lifeline given the company’s continuing implosion.