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I don't know any specifics, but I'd guess that united's up-front payment is near $0, and the main benefit for boom is not the immediate cash flow but the abilit
by notatoad 5y ago
I don't know any specifics, but I'd guess that united's up-front payment is near $0, and the main benefit for boom is not the immediate cash flow but the ability to take united's order to a bank and use it to secure a loan.
- notahacker 5y agoThey won't even be able to take it to a bank, but it'll enhance their credibility with VCs. United get a bit of PR, and if Boom does work out they're at the front of the queue and have probably influenced the design a bit by the time it comes to deciding whether to actually pay.
- refurb 5y agoAgreed. These types of agreements, this early, tend to be Letters of Intent that aren’t legally binding OR a contract stating that “if Boom produces planes to agreed upon spec by 2029, United will purchase 15...” plus a bunch of out clauses.
- cududa 5y agoUnited could’ve also invested in the co as part of the deal.
- notatoad 5y agoThey could have done, but usually if they're making an investment they'll want to make a big splashy announcement about that.