Fortress Investment Group recently expanded its investment strategy to offer its investors a totally secured investment in iPass, a leading worldwide provider of global connectivity options. The amount of the funding totaled $20 million, $10 million of which was available immediately to iPass. Gary Griffiths, iPass CEO and President, commented, “With our balance sheet strengthened by this financing, we can shift focus back to growing our revenue and closing the gap to profitability. Moreover, using our patents as the security for this loan brings credibility to the prowess of the patents that provide the basis for iPass SmartConnect and Veri-Fi product families.”
The loan is secured by all of iPass’s considerable assets that include its SmartConnect technology and patent portfolio. Riley Financial, Inc., brokered the deal. Riley Financial, which operates in four segments–Auction and Liquidation, Capital Markets, Principal Investments and Valuation and Appraisal–is an investment bank that specializes in putting together these kinds of high-profile deals. The company is well-regarded in the financial world for its highly ranked equity research. The company understands the value of equity, and the iPass-Fortress deal obviously met or exceeded the company’s valuation protocols.
iPass Operates the World’s Largest Wi-Fi Network
iPass operates the world’s largest Wi-Fi network that enables consumers and businesses to access millions of Wi-Fi hotspots to enjoy always-on Wi-Fi. Designed as a Software-as-a-Service, or SaaS, application, iPass Wi-Fi provides strong value to customers with unlimited Wi-Fi on an unlimited number of devices. Customers can access more than 64 million hotspots worldwide. These include hotels, airports, restaurants, train stations, outdoor entertainment venues and convention centers.
The number of hotspots is expected to grow to 340 million by the end of 2018. Exponential growth in Wi-Fi technology makes iPass a good investment for Fortress, and its investors can certainly appreciate the wisdom of investing in Wi-Fi technology.
Under the agreement with Fortress Investment Group, iPass gets immediate access to $10 million. iPass Unlimited is transforming into a cloud-based business, and third-party analysis by Maravedis Rethink found that there will be more than 340 million global hotspots by the end of 2018. iPass hopes to leverage many of these in its business model to provide unlimited Wi-Fi to individuals and companies. This demand has been recognized by forward-thinking companies such as HP and Microsoft. Fortress joins these elite companies by investing in iPass and its cloud-based SaaS strategy.
FIG Expands Its Influence in Critical Areas
Fortress Investment Group was organized in 1998 and became the first private-equity investment group to go public. The company has always been a trendsetter and prefers to invest in areas where its clients can receive strong risk-adjusted returns for long-term investing strategies. Investing in iPass is a perfect match for this philosophy because iPass offers astonishing convenience in Wi-Fi access, which is only going to become more popular over time as companies and individuals increasingly work on-the-go and in extraterritorial work environments. Many people now combine work and vacationing year-round, and iPass technology can enable Wi-Fi access at millions of global hotspots.
The deal between Fortress and iPass is secured by iPass assets and patents that provide the basis for Veri-Fi products and iPass SmartConnect, which enables customers to enjoy the best roaming experience available. SmartConnect software learns from experience to build a real-time picture of available networks so that customers can make wiser connection decisions. Fortress Investment Group made a wise decision to support this technology with investment capital. FIG employs 900 people and is headquartered in New York where it manages more than $40 billion in assets for more than 1,750 investors.
Fortress recently raised $2.9 billion in May of 2017 in its sixth round of funding. Fortress earned more a 39.7-percent return for its private investors between 1999 and 2006. The company launched on the New York Stock exchange on February 9, 2007, and by June 30, 2016, it managed more than $70.2 billion in alternative assets.
Fortress was named “Institutional Hedge Fund Manager of the Year” by Institutional investor Magazine on June 30, 2014. The company has won many other types of recognition from peers in the financial industry, and the company employs more than 953 asset management professionals in its New York and affiliate offices around the world.
It’s likely that iPass can lock down a competitive advantage with $20 million in funding and become profitable quicker than planned. Simple, secure Wi-Fi will likely remain a wise investment for the foreseeable future. $10 million, or half of the deal, has already been drawn down for iPass to use. As of March 31, 2018, Fortress manages about $40.9 billion in assets. This deal promises to raise the profile of both parties and deliver long-term dividends to investors.