Rocket Lab Wants To Be The FedEx Of Space

January 19, 2020

5 4 We have ignition Launching rockets is serious business The market is predominantly filled by massive government contractors as well as the $28 Billion SpaceX And lift off for the Falcon 9 They all put satellites the size of school buses into orbit around the earth But there’s a new side to this industry Going smaller with the Rockets could lead to a new big business Rocket Lab, a 12-year-old company based in New Zealand and in California, valued at over $1 billion, wants to do just that and launch, a lot Had to be, you know, launched affordably and launched frequently, everything is about that The company’s electron rocket comes at a price tag of $5.7 million dollars A fraction of the $50 million or more it costs to launch a larger rocket Rocket Lab’s not trying to compete with those big Rockets It’s targeting a different customer says CEO Peter Beck But he thinks it has the potential to revolutionize the benefits we get from satellite technologies Electron lifts the spacecraft about the size of a refrigerator Or, or, you know, we joke your mother-in law and her chair To give you a sense of the scale, Rocket Labs electron rocket is about five stories tall That’s only about 1/4 the size of the SpaceX Falcon 9 rocket Being small and cheaper, opens up new opportunities Think of SpaceX as the joint train that goes once a month and we’re the Fedex Vans that go every day If we’re if we’re launching at one, one a week, then everybody’s lives that are watching this significantly different Take, for example, the agriculture industry We like to think we live in a connected world and we do in the cities but outside the cities, we’re not very connected So you know that on a global scale is, is a very powerful tool for you know farmers and industries globally To be able to understand food yields and understand you know efficiencies of food crops but also understand shortages Most people I don’t think would know that their plane flying across the ocean, yeah, isn’t being constantly tracked Or that Cargo shipment more than a couple hundred miles offshore, right? That’s, that’s, that’s consistent across a number of industries, not just aviation in, in, in Marine. 4, 3, 2, Ignition In January 2018, Electron reached orbit for the first time Putting the company at the front of the pack in the small rocket race Beck estimates that there are over 100 companies trying to catch up But rocket lab has already completed its first commercial launch and has 16 launches planned for 2019 Not everybody is sure this industry will take off While there’s potential, the demand is still speculative Leading small launch providers are hoping takes roughly 30 launches next year and they’re probably averaging $3 million per launch So if everything went perfectly, they would have just over 1.5 percent of the launching stick But you look at this and history suggests, they’re gonna experience delays and there’s huge development risk And then, longer term sustainable demand, I say even more speculative as pseudo-satellites and drones can offer similar capability to the end customers Remember people were skeptical of the private space industry just a decade ago Now there are more than 300 space companies, worth tens of billions of dollars And Beck says his company will soon be profitable We complete these a couple of launches by the end of this year, you know we’ll be cash by neutral, cash flow positive So when will you be able to send your satellite into space It could be sooner than you think A group of high school students in Irvine, California already launched their small satellite Sending it up to orbit with Rocket Lab in November The, the main payload is the 3 megapixel camera and we will be using it to capture images of stars and planets These kids aren’t paying for it themselves, they’re funded through private and corporate sponsors, including Google and Wells Fargo But still pretty cool So when will you be able to invest in Rocket Lab The company says they want to be launching consistently before an IPO

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