Rocket Lab hits $US1b valuation
Rocket Lab has raised $US75 million in its latest funding round (its fourth), and is now claiming a private equity value of more than $US1 billion.
Founder and chief executive Peter Beck says the money will be used to increase production of his company’s 18m, Electron rocket, which can take small satellites into low earth orbit of the (by aerospace terms) bargain price of $US5 million.
The rocket man says the first of three test launches should take place within two months, with the first commercial flights hard on their heels.
“We have a number of commercial missions we need to get out this year. We have a NASA mission that needs to fly. We also have a Moon Express mission that needs to fly by the end of this year.”
The first test rocket is now on the launch pad at Mahia.
If all goes to plan, there will be seven flights this year, and 18 next year. To put that in context, there were 19 rocket launches in the US last year, Mr Beck says.
“Demand is extreme,” he adds.
US heavy hitters
The Auckland-founded Rocket Lab is a success story, but also one that’s being pulled inexorably into a US orbit.
The company is now incorporated in the US and based in LA, where it will shortly open a new facility because manufacturing will shortly be maxed out in NZ.
It will also build more launchpads, but “I don’t think we’d build at other sites around New Zealand,” Mr Beck says.
“We’re looking at equatorial sites and sites in the US to meet our demand.”
Already, Rocket Lab has access to NASA's Cape Canaveral launch site via a partnership agreement with the US space agency, plus a private launchpad in Alaska.
It's share register has also become progressively less Kiwi since it was founded by Mr Beck in 2006. While Sir Stephen Tindall’s K1W1 was an early backer, other investors have been the US heavy hitters Khosla Ventures, Bessemer Venture Partners and military giant Lockheed Martin. Mr Beck also has a holding.
Rocket Lab's first launch complex is on the Mahia Peninsula, between Gisborne and Napier, where an Electron rocket is already on the launch pad ready for the first test flight (click to zoom). The company plans to build other launch sites, founder Peter Beck says. Some will be outside NZ.
The $US75 million funding round announced overnight was led by Silicon Valley/San Francisco-based firm Data Collective, a VC outfit whose other investments include Rocket Lab customer Planet — a supplier of satellite imagery.
It was also supported by another newcomer, the Chicago-based Promus Ventures, while Bessemer, Khosla and K1W1 chipped in further funds.
In all, Rocket Lab has now raised $US148 million.
It refused to give NBR a breakdown of shareholdings pre or post the latest raise.
Fight with Space X for talent
How many staff does Rocket Lab have today?
“I should probably know this,” Mr Beck says during an NBR Radio interview. It’s hard to keep tabs, he says, as Rocket Lab is hiring three to four staff a week between Auckland and LA.
A spokesman later said “Over the next few months we’re likely to range between 150 and 200 employees."
Of those “10 to 20” are management staff based in California. The balance are working at the company’s facility in Mangere beside Auckland airport or at Mahia.
Rocket Lab is not directly competing with Elon Musk’s heavier-lifting Space X for launch business, but Mr Beck says there is a fierce fight for limited number of skilled staff. To land the right rocket scientist, his company will pay to relocate their whole family to NZ.
Rocket Lab recruits aerospace engineers from around the world, but is also sponsoring a PhD course at Canterbury University to foster local talent.
Economic development minister Steven Joyce makes final inspections of an Electron. Rocket Lab's rise prompted MBIE to introduce new space regulations.
A full pipeline
A 2016 report by Sapere Research Group said the NZ aerospace industry founded by Rocket Lab would contribute between $600m and $1.55 billion to the economy over the next two decades.
Rocket Lab has not put a dollar value on any of its contracts, but NASA says its contract, which covers one flight plus services, is worth $US6.9 million.
Other customers in the pipeline include Moon Express, which has booked three launches as part of its plan to ultimately send a robotic probe to the lunar service, and satellite imagery outfit Planet. Rocket Lab's "rideshare" model means more than one customer can share a flight, as long as they can all be accommodated within the Electron's 150kg payload.
“We weren’t expecting to see such demand for a vehicle that hasn’t even flown. Generally speaking the space industry is very, very conservative. But it’s a testament to the team and the product that we’ve had customers pile on and take up two years’ of manifest. It’s a quality problem to have.”