Starry, the ISP that delivers internet to your home using wireless antennas instead of cables, is laying off around half its workforce, or just over 500 people, according to a statement from the company and a report in The Boston Globe. The company is also telling investors that they can no longer count on the expectations it set for this year — information that probably doesn’t come as a surprise after its earnings report this summer revealed that it had around $100 million in cash and had lost almost $90 million since the beginning of 2022.
Starry says it’s also freezing hiring and non-essential expenditures, again in order to “curtail our cash burn while we pursue strategic options,” as Chet Kanojia, the company’s CEO, put it in a statement included in the press release.
This summer, the company only had around $100 million in cash — and was burning through it fast
Another part of its cost-cutting measures includes scaling back on its expansion plans. In August, Starry said it was “strongly positioned to continue on its growth trajectory,” but now it’s saying it plans on focusing on the places where it’s “already invested capital,” as in the places its network can already reach. That means Starry is “pausing deployments to new areas that are not in our existing markets,” according to spokesperson Mimi Ryals. As it announced last week, Starry won’t be fulfilling the bids it won through the FCC’s Rural Digital Opportunity Fund, which were set to net it $269 million, according to Light Reading.
The company operates in Boston, Denver, Los Angeles, New York City, Washington, DC, and Columbus, Ohio, and its Thursday report says it currently has more than 91,000 “customer relationships,” its term for both individual users and ones included in bulk billing agreements. That’s in contrast to the nearly 6 million homes it says its service can reach.
Starry launched in 2016, promising to provide gigabit internet using wireless networks instead of more traditional DSL, cable, or fiber infrastructure. It works by using a big antenna that beams data to other, smaller antennas spread across a city, which then connect to more traditional routers. Part of its business plan involves teaming up with building owners so companies that run apartments could offer the service to tenants.
The company went public earlier this year via a SPAC (read: a merger with a shell company that’s already gone public, which helps skip the traditional IPO phase), raising around $176 million, according to the Globe. Since then, its stock has cratered; it peaked in June at around $10.61 but is currently trading at around $1.15. That makes it very difficult for Starry to raise cash, which its own press release notes that it needs. We likely won’t know just how much it has left in the bank until November 2nd, when the company releases its Q3 results.
Update October 20th, 6:12PM ET: added confirmation from Starry that it’s pausing deployments to new markets.