As Michael had eluded to when he lost his building he needed to regroup and focus on what could be done between the time he lost the building, mid-April, up until September when his money runs out. And as Alan Boyle over at MSNBC reported on April 19th he and his team have decided to focus on tethered towers. Here's how his new company is described;

"Tethered Towers is a newly formed communications company. We specialize in the manufacture and deployment of high elevation towers that open a whole new realm of possibilities. Tethered Towers are flexible, quasi-permanent, portable, towers that can be deployed to considerable attitudes in minutes, with applications for which we provide development and deployment services of custom operational-service-packages (OSP’s)."

At the same time that Liftport was reinventing itself it had to deal with another new problem. On the Space Show Micheal was quite candid about talking about his problems and setting things straight but he did not mention one problem few people know about. On April 18 the Washington State Department of Financial Institutions, Division of Securities issued the following order with regard to Liftport;

"Liftport Inc. dba Liftport Group; Michael Laine - S-06-077-07-SC01 - Statement of Charges (PDF)

On April 18, 2007, the Securities Division entered a Statement of Charges and Notice of Intent to Enter an Order to Cease and Desist, Impose Fines and Charge Costs against Liftport Inc. dba Liftport Group and Michael Laine (“Respondents”). The Statement of Charges alleges that Respondents raised at least $117,000 from at least 85 investors, nine of whom are Washington residents, by offering and selling unregistered securities in Liftport, Inc., a company formed for the purpose of developing a space elevator. The Securities Division alleged that the Respondents acted as an unregistered broker-dealer and/or securities salesperson. The Division also alleged that the offer and sale of securities by the Respondents violated the anti-fraud provisions of the Securities Act of Washington. The Securities Division ordered the Respondents to cease and desist from violating the securities registration, broker-dealer and/or securities salesperson registration, and anti-fraud provisions of the Securities Act of Washington. The Securities Division gave notice of its intent to collect fines and charge costs. The Respondents have a right to request a hearing on the Statement of Charges. "

After reading the statement of charges above I was not surprised when Michael said in the show:

"It would be terribly unethical for me to ask for investors at this point because I don't the shape of this company, I don't know if it can, if it can stand on its own two feet. So if we don't generate revenue, there's not another source, and I'm not willing to go and ask for people for money right now, that's not a good plan for me."

I can understand why Michael would not want to ask investors for money with a cease and desist order out there.

For his newly formed entity Tethered Towers to survive he said he needed to generate $25,000 a month by September and that there was no backup plan. As well they are planning on a high visibility demo of their tethered tower system in the Seattle area around June 20th plus or minus 5 days if the FAA gives them approval. And if the demo fails or if they don't start generating revenue by September Michael said he would have to close shop.

Another new idea he mentioned was to use the open source model for developing a space elevator. A novel idea coming from a company that spent fours year as a closed company and hardly participated in the current community efforts.

I would certainly like to see Liftport succeed with its new venture but the odds, and more importantly, time are really against them. And they didn't get into this predicament through the actions of others. They spent fours years doing research and development (R&D) without the proper financial resources in place and did not produce a single product that was taken to market. If you have deep pockets or some serious financial backing you can spend fours years focusing solely on R&D, but Michael gambled everything he had on being able to do it his way and that gamble appears to be one he is about to lose.