Charles Kohnen, co-founder of the submersible manufacturer SEAmagine Hydrospace, estimates that there are 200 manned vessels worldwide. Some are used by scientific institutions, others for tourism. But a growing number belong to a select group of yacht owners.
While a ticket aboard a submersible tour, like the one that ended in tragedy this year en route to the Titanic shipwreck, is too pricey for most people, owning a submersible requires another level of wealth and boating infrastructure.
Only sufficiently large yachts — at least 120 feet — can hold a sub, which typically costs between $2 million to $7 million (not including the cost of a crane to lower the sub, the speedboat needed to board, and services like mapmaking and guides that can run about $15,000 per day).
“It’s not like a fancy car,” Kohnen said. “It’s more like a $5 million spacecraft.”
Just as having a helicopter and launchpad on a yacht was hot in the 1980s, Kohnen said, getting a personable submersible is increasingly a thing for the wealthy.
Ofer Ketter, whose company, SubMerge, caters to personal sub owners, sees a similar trend. “You have a mega-yacht, a super yacht — a submersible has become the next thing to have,” he said.
Deep-sea explorations have a growing fan base among the elite. The filmmaker James Cameron and the billionaire investor Ray Dalio have both donated vessels to the Woods Hole Oceanographic Institution and invested in the submersible manufacturer Triton Submarines. Dalio said it was about discovery. “The ocean is the greatest resource we have,” he said. “It’s twice the size of all continents combined — and underexplored.”
Some submersible owners lend out their vessels for documentaries and scientific research, while others are in search of never-before-seen species or want to explore shipwrecks. And there is a kind of mixed-use model that is versatile for everything from an underwater wedding to cocktails on the reef, dinner or a poker game, said Craig Barnett, Triton’s director of sales and marketing.
The personal submersibles industry has grown with the size of yachts. When SEAmagine started in 1995, mostly robots were used for deep-sea scientific work because lowering submersibles into the ocean with people inside was unwieldy, Kohnen said. The company built a model that could be boarded from the water, and this relaunched an era of manned submersibles for science and tourism. Around 2005, SEAmagine got its first yacht commission — and competition. Another submersible manufacturer, U-Boat Worx, started operations in the Netherlands, and Triton soon followed. Yachts were becoming bigger, but, Kohnen said, people were also starting to value experience-seeking over luxury.
Making “the moment.” Where to dive and how long an expedition lasts depends, but an adventure can take months of planning to scout, map and set up. SubMerge has coordinated five expeditions with three different private clients this year, Ketter said, and the company works with about six luxury travel firms, including submersible manufacturers.
A typical day “in a good spot” usually involves a few dives that last about an hour or two, with breaks for meals, Kohnen said. “Even after a thousand dives, it never stops being exciting.”
What about the implosion of the Titan? The fatal OceanGate tour shined a harsh spotlight on deep-sea adventure. But Kohnen said the craft involved was an “outlier” that was not built to specifications and had been a cause of concern in the submersible community for years.
Ketter said that his company had not had any cancellations since the accident. Triton likewise said that it had no cancellations, that it was building five submersibles and experiencing “remarkable demand” from private owners and tourism companies.
Although private submersibles are gaining momentum, Barnett said, the number of scientific institutions using them was “regrettably low.” Dalio said he thought filming the ocean from private craft would spur more investment and exploration. “It’s very underfunded, but it’s picking up,” he said. — Ephrat Livni
IN CASE YOU MISSED IT
The Fed could pause interest-rate rises next month as inflation cools. Consumer prices rose moderately in July, according to Consumer Price Index data released this week, and consumers expect inflation to slow over the next year, a closely watched University of Michigan survey showed. The wild card is volatile food and fuel prices, which could add to inflationary pressures.
Goldman Sachs’s longtime chief of staff steps aside. DealBook reported that John Rogers, the bank’s longtime chief of staff, would start handing over some of his responsibilities to Russell Horwitz, a former deputy. The shake-up occurs as Goldman’s C.E.O., David Solomon, conducts an overhaul of the bank, which has seen prominent executives leave.
Disney vows to stem streaming losses and doesn’t rule out selling its TV businesses. The entertainment giant’s C.E.O., Bob Iger, said subscription-price increases for Disney+ and Hulu would go into effect in the fall. And, like Netflix, it will crack down on password sharing. Wall Street is getting impatient as Disney’s streaming losses have ballooned to more than $11 billion since 2019.
Zoom’s A.I. data policy sets off a backlash. The popular videoconferencing platform issued a clarification this week that it would seek customers’ consent before using their audio, video or chat data to train artificial intelligence models. Digital rights’ advocates, however, worry that may not be enough to protect unsuspecting Zoom users as privacy concerns multiply alongside the explosion in popularity of A.I. tools like the ChatGPT and Bard chatbots.
A Kennnedy bets on start-ups that serve the disabled
The Kennedy family has for decades made advocacy for the disabled one of its signature causes, from Senator Ted Kennedy sponsoring the Americans With Disabilities Act to Eunice Kennedy Shriver founding the Special Olympics.
Now, a scion of the political dynasty, Christopher McKelvy, has teamed up with Judd Olanoff, a former JPMorgan Chase banker, to approach disabilities in a new way: by starting a venture capital firm focused on the community.
Meet K. Ventures. McKelvy — a grandson of Patricia Kennedy Lawford and a former tech executive — and Olanoff initially worked together on public policy advocacy for people with disabilities and their families at the Joseph P. Kennedy Jr. Foundation. (McKelvy is a trustee at the foundation.)
They realized that the start-up sector offered both new services for the disabled and viable business models that could scale because of developments like Medicaid reimbursements. McKelvy and Olanoff left the foundation last year to start their firm. Its backers include Brian Jacobs, a longtime investor who runs Moai Capital, who told DealBook that the founders’ connections “are definitely unique and valuable.”
“My family’s hope,” McKelvy told DealBook, “is that K Ventures will be the next chapter” of our work on behalf of the disabled.
The firm is a bet on the growing market for disability services. The Centers for Disease Control and Prevention estimates that up to 27 percent of the country’s population has some kind of disability. The agency also found in 2020 that one in 36 children has been diagnosed with autism, up from one in 44 in 2018, thanks to better recognition of symptoms.
Olanoff said big companies were also starting to invest in providing disability services and benefits, presenting an opportunity for start-ups.
K. Ventures has made three investments, including Juno, which provides cash benefits to parents if their children become severely injured or disabled; Juniper, which automates billing for behavioral health services providers; and NeuroNav, which helps adults with developmental disabilities in California devise their own customized help services.
Major investment firms have also started to take notice of the opportunity: Andreessen Horowitz and Y Combinator have backed Juniper, while Pear VC has invested in NeuroNav.
McKelvy and Olanoff are using the Kennedy name and resources, including by bringing in advice and networking opportunities from relatives like Tim Shriver, the chairman of the Special Olympics, and Patrick Kennedy, the former congressman. For the past two years, it has also hosted a forum for disability start-ups at the Kennedy compound in Massachusetts.
Shriver believes disability advocacy needs philanthropy, but also businesses with sustainable and profitable operating models. When his team heard about K Ventures, he said, “we thought, bingo, that’s the missing piece.”
The reporting behind Netflix’s ‘Painkiller’
The Supreme Court temporarily blocked a bankruptcy deal for the Sackler family’s Purdue Pharma, the maker of OxyContin, on Thursday. The agreement would have capped the liability of the Sacklers at $6 billion and protected the family from any more civil lawsuits connected to the opioid epidemic. But the ruling will likely delay payments to the thousands of people who sued the Sacklers and Purdue.
In 2003, Barry Meier published “Pain Killer,” a book about the illegal methods and distorted science that Purdue had used to promote OxyContin. This week, Netflix released a series based on the book starring Matthew Broderick as Richard Sackler, the former president of the company, who led the push to develop the drug and make it a routine treatment for pain.
DealBook spoke with Meier, a former reporter at The New York Times, about what had changed — and had not — since he first began investigating the role companies played in the crisis. This interview has been edited and condensed for clarity.
Why does the story remain so relevant two decades after the book was published?
It’s remarkable, and sad that it took as long as it did for the book to reach this big audience. But there’s hardly a person in this country who hasn’t been affected in some way. It’s 20 years from when it was published, and during that time more than a quarter of a million people died of overdoses from prescription opioids like OxyContin.
You said the book was a “total flop” when it was published. Was there an inflection point when people started paying more attention to the story of Purdue Pharma?
It started about 2017, 2018, when there was this new wave of lawsuits brought against not only Purdue, but individually against members of the Sackler family. That was a real turning point, because we began to see internal documents that were written by Richard Sackler. And, subsequent to that, the photographer Nan Goldin began her campaign for museums to take the Sackler name down from their walls, which turned out to be a remarkably successful political and cultural campaign.
Has anything changed in the relationship between the pharmaceutical industry and Washington?
I would hope that the Food and Drug Administration will never again make a decision as catastrophic as it did when it allowed Purdue to claim that this incredibly powerful and potentially addictive drug might be safer than competing drugs without even a shred of evidence.
But you can never be sure. I have seen numerous instances where a medical product that was valuable for a limited pool of patients has run amok because its manufacturer decided that in order to make billions of dollars, it was going to have to promote it to as many patients as possible — patients for whom the benefits of the drug began to be outweighed by its substantial risks. This is not a pattern that’s unique to OxyContin.
Could that pattern be shut down?
Until we start seeing corporate executives marched off to prison for violating the trust that doctors and patients have put into them, nothing is going to change.
We’d like your feedback. Please email thoughts and suggestions to [email protected].
