In a virtual meeting Friday, July 28, the new CEO for AeroVanti, the beleaguered private air service based partially in Sarasota, laid out rescue plans for the company, which is grappling with at least five lawsuits, dozens of irate customers and other deep-seated challenges.
The main point? The business model has to change for the company to carry on.
In addition to the plans moving ahead, Hopes, during the call, addressed a major sticking point with AeroVanti members — many of whom paid at least $150,000 for flights and have yet to set foot on a plane, according to multiple interviews with members, allegations in lawsuits and social media posts.
The answer to whether members will be refunded: not likely — at least not likely in the near future.
That's because, Hopes says, the company doesn't have any money right now — save for a $2 million loan it recently obtained to get employees back to work. In addition, Hopes says the company's bank accounts have been suspended. He did say an internal forensic accounting investigation is underway to determine what happened to the funds.
The hour-long virtual call, for which the link was sent out to AeroVanti members and the Business Observer was allowed to attend, had 81 people logged in at one point. Hopes addressed several key issues plaguing the company, which operates on a membership model that costs at least $150,000 a year in exchange for members having access to flights.
When asked about the company's current business model, Hopes, the former Manatee County administrator, says it may have to change for the business to survive.
"I've looked at some of the earlier contracts and rates (but) unless we have a sustainable model and operation, it doesn't do anybody any good," Hopes says, hinting prices could be increased. "I do not believe the way it's structured right now is sustainable."
The hope is to have a new business model in the next couple of weeks before flights are operational. "I cannot think of anything more important," Hopes says.
Next on the to-do list? Maintaining Federal Aviation Administration compliance.
On Friday, Hopes says he spoke with Federal Aviation Administration officials, assuring them AeroVanti is in compliance of regulatory standards. "Part of that is because we don't have a plane flying," he admitted, before assuring members on the call that the company would stay in compliance when it's operational.
The FAA's involvement with AeroVanti dates back at least a month. The Business Observer previously reported the FAA was looking into the actions and activity of the company, which has a dual headquarters in Sarasota and Annapolis, Maryland.
An email from Cody Watson with the FAA's Washington Flight Standards District Office to an AeroVanti member who wished to remain anonymous, obtained by the Business Observer in late June, reads, in part “AeroVanti remains a top priority of mine. New information still comes in and we are actively working through our investigation process. Validating information and evidence can be very time consuming."
Getting AeroVanti and its planes back in operating status holds high significance for Hopes, who holds an airline transport pilot certificate. In a phone call with the Business Observer after the virtual call, Hopes explained that even a small occurrence like getting up to use the restroom while the seatbelt sign is on during a flight could cost him his personal certificate.
One of the big issues in lawsuits and social media posts from jilted members has been the lack of planes when people wanted to fly — the whole point people sign up for this service. At one point the fleet was basically grounded, though, at the time in late June, founder Patrick Britton-Harr, in an interview and text with the Business Observer, denied the planes had stopped flying.
As of Friday morning, Hopes says there were six AeroVanti planes on the ground at Sarasota-Bradenton International Airport, with another one located at St. Pete International Airport and one in California. Two planes were returned to their owners earlier this week. Each plane, Hopes says, is in various stages of inspection and repair.
When asked by a person on the virtual call about redemption agreements that were offered to members under the previous leadership, in an attempt to make up for lost cash, Hopes says, "To my knowledge there is no cash on hand."
Hopes is asking to see those agreements to determine the depth of how much was promised, but due to the company's bank accounts being suspended, he believes money was never available to be promised.
In response to the missing money, Hopes says the forensic financial investigation to take at least five and a half months. Pre-audit work was already completed.
It was also brought to light during the call that a $2 million loan from a Tampa Bay investor deposited Friday, July 21, was secured through "the assistance of Todd Britton-Harr," who is Patrick Britton-Harr's brother. Patrick Britton-Harr founded the company in 2021 and, in addition to the AeroVanti lawsuits, is a defendant in a civil case filed recently by the U.S. Department of Justice for alleged Medicare fraud at another company he owns.
Patrick Britton-Harr, meanwhile, no longer holds any role in AeroVanti — not only was he the founder and CEO, he was also the board's secretary, treasurer, director and chairman, Hopes said Friday.
"That sets up a very dangerous governance scenario where decisions may not be made in the best interest of the company or shareholders," Hopes says of one person holding so many positions. Hopes is now chairman of the board, CEO and president.
Hopes also addressed being personally named in lawsuits now as CEO. "I will continue to do my part to help negotiate sensitive resolutions on what appears to be mostly civil suits," he says.
Going forward, Hopes is seeking to diversify the board and add people to it. So far, Paolo Ferreri, who was announced as AeroVanti's COO earlier this year, has joined the board. Ferreri is the former CEO and chair of Piaggio America, a now out-of-business subsidiary of Italian company Piaggio Aerospace. Hopes says he's also in talks with an aircraft owner who plans to view the company's financial status before agreeing to join.
"Today," Hope says, "is really the beginning of the start of AeroVanti."