Rocket Lab raises $140 million to fast-track business of small rockets

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Rocket Lab’s year began with reaching orbit, and the company has not slowed down since. The company doubled its global workforce to 330 employees, with Spice joining as CFO earlier this year after nearly 20 years in the semiconductor industry. He has done about 60 acquisitions in his career, which Spice said is one of the key reasons Beck hired him.

The company opened an 80,700 square foot mass production facility in Auckland, New Zealand, in October.

Rocket Lab also announced in October it will build its first U.S. launchpad at NASA’s Wallops Facility in Virginia. Unlike its launchpad on New Zealand’s Mahia Peninsula, which is a private facility, the Virginia launchpad is on NASA property.

“The U.S. launch site is really to serve government customers who require launch off U.S. soil,” Beck said.

Spice said Rocket Lab plans to use about one-sixth of this $140 million investment round to add second and third launchpads at the company’s New Zealand facility “relatively soon.” Mahia has a “strategic value” that Spice does not think many people understand.

“It’s the only privately-owned launch facility and that is a huge differentiator,” Spice said.

Rocket Lab is going to need multiple facilities if it is going to reach its goal of launching on a weekly basis. The company has a backlog of launches for the next year and a half, with 16 planned for next year. Beck said the company is “tracking around a $3 billion pipeline” in future launches.

Another one-third of the $140 million will go to research and development. Beck said the company is beginning to work on three major R&D projects. And Rocket Lab is already preparing for its next orbital launch, set for December.

Beck estimated Rocket Lab will soon be profitable, saying when the company completes “these couple of launches by the end of this year we’ll be cash flow neutral.” But the company is well aware of how difficult spaceflight can be. That mentality remained front of mind for Spice when thinking about how this new funding should be utilized.

“We basically funded ourselves to survive a pretty lengthy shutdown on the pad if we have an anomaly, any unforeseen pricing pressure from well heeled competitors, and absolutely keep our foot on the gas from an investment perspective,” Spice said.

2018-11-15 14:00:00

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