Science

In 5 years, 5,000 spacecraft will be looking for launch: Rocket Lab CEO Peter Beck

M Ramesh Chennai | Updated on September 07, 2019 Published on September 07, 2019

Rocket Lab’s founder & CEO Peter Beck talks about the booming space business

Last month, Rocket Lab launched its eighth rocket — since its first only two years ago — and put four satellites in orbit, adding to the 35 it had sent up in its previous missions. The California-based company’s other claim to fame is its impressive array of investors — Khosla Ventures, Bessemer Venture Partners and Lockheed Martin, to name just three.

It has not been easy to get there, said Peter Beck, the company’s founder and CEO, in an email interview to BusinessLine. Beck, who won the ‘New Zealander of the Year’ award in 2015, believes the company’s fortunes are soaring. Excerpts:

The market for small satellites is big and growing. What triggered this mega-trend?

We’re in an exciting new era when it comes to satellite technology. There is a shift away from large geo-stationary platforms, which traditionally have required hundreds of millions of dollars to build and launch, and have been needed to provide services from orbit for decades, offering little opportunity for new technology developments. Now, we’re seeing a shift towards small satellites that are highly capable but faster and more cost-effective to build and launch.

Constellations of these satellites provide resiliency in numbers, and also present better opportunities for innovation as technology develops since they only have an orbital lifespan of a few short years.

There is massive demand to get these small satellites on orbit, and that’s where Rocket Lab has found its success. Rocket Lab has now completed seven launches (eight, since) with a 100 per cent launch success rate for customers. We’ve delivered 35 satellites (39, since) to orbit for various commercial and government customers, including NASA and the US Air Force. We have monthly launches scheduled for the rest of the year — in fact we are licensed to launch from New Zealand up to 120 times a year. Our manifest for 2020 and beyond is booking up fast.

Can you give an idea of how big the market is?

In the next five years, by some estimates, around 5,000 spacecraft will be looking for a ride to orbit. At last count, more than 130 companies are trying to build launch vehicles to cater to this market. To date, Rocket Lab is the only commercial, dedicated small satellite launch provider to have flown.

Designing, building and launching a rocket is only the first step in building a small satellite launch business.

Even after the first flight is off the pad, there are several other factors which come into play which can take years to resolve as well. It took Rocket Lab roughly the same amount of effort and capital to go from founding to first test launch, as it did to go from that test launch to regular commercial operations.

How are the returns in this business? How is the investor interest in this?

Rocket Lab is a private company. We are funded by tier-one Silicon Valley venture capital to the tune of $288 million. Our latest funding round in November 2018 saw us raise $140 million to continue scaling production and for R&D projects. Now, in our second year of commercial operations, with a rocket launched roughly every month, Rocket Lab is cash flow positive.

What are your company's immediate and long-term plans?

From day one the focus at Rocket Lab has been on launch frequency and we continue to increase this. We are scaling production facilities, building new launch sites, and growing the team to reach our target cadence of one launch per week. This is what the small satellite market needs to become truly accessible.

To support this launch frequency, Rocket Lab recently revealed plans to recover and re-fly Electron’s first stage and move away from being an expendable launch vehicle. The programme is still in development and testing, but if successful it could remove the need to build a new first stage for every mission, saving precious time.

There are a few Indian start-ups who are promising to provide launch services at a fraction of the cost that it takes in countries like the US. What is your comment on such start-ups and how would you compete against such low-cost launchers?

Being the first at anything is good, but in the small launch provider market it is particularly important. Being the first, and currently only, commercially operating small launch provider anywhere in the world today is a huge difference between Rocket Lab and others still trying to make it. Getting to that first flight took years and years of hard work, dedication and resilience from the team. But we’ve since found that it took the same amount of time, capital, and energy to get from that first commercially-viable launch as it does to get to flying once a month. Being the first to launch successfully is everything, and flying regularly is just as important.

A small satellite customer now has the choice between booking a launch on a vehicle that has yet to get off the ground and risk missing out on a ride to orbit on a vehicle that’s already proven itself and is fully operational. By operating our own launch site, we can launch more frequently than any other launch provider in the world, offering our customers unmatched schedule control.

Published on September 07, 2019
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