If you turn up tomorrow and say, "I want to build a thousand satellites." Good luck. It's a CAPSTONE mission to the moon we did for NASA a few years ago that was done out of here.
Yep. The Electron rocket was under $100 million and 80 people put the first rocket into orbit. These particular missions are very difficult missions. They're like 12-year lifespan operating in nasty, nasty radiation and they're missions that just cannot fail. We have 13 acres of factory around the world. Yeah. So this is a pretty small piece of rocket land.
Is there anything we haven't seen? We're not allowed to see.
Lots. We just saw a tiny portion.
Yeah, yeah, yeah. We are here today at Rocket Lab in Long Beach with Sir Peter Beck. Thanks for having us.
So, what are we going to see today?
Well, we'll try and show you a little bit of Rocket Lab. You know, we're spread across the entire United States and Germany and New Zealand and a little bit in Australia. So, there's a lot to see, but we'll show you headquarters here, a little bit of satellite manufacturing, and some engine developments.
Amazing. Let's walk through. You have one of the coolest entrances I've seen.
So, does it remind you of anything? This is how I test how much of a sci-fi nerd—
No, it's probably a little bit old. It's 2001: A Space Odyssey.
Oh, that's exact— that's what I was— yeah, that's exactly what I was getting at.
The best sci-fi movie ever made because it's the most accurate. But this bit is supposed to remind you of the bit where they shut down the HAL 9000 computer, you know.
"Don't do that, Dave." You know, it's like that.
Do you have any other inspiration of sci-fi movies in here?
Well, when we walked in here earlier, we were kind of stuck to the timeline because it's jam-packed with so much stuff. There's so much going on. So, it might be cool to walk through some of that and kind of show what you have in the lobby area. It seems like a showcase.
Yeah. Well, like any company, it's like the 20-year overnight success. So started the company in 2006 down in New Zealand. And sort of between 2006 and 2009, we were like our own little technology development house. And in 2009, we launched our first suborbital rocket called Ātea-1. And we were the first private company in the southern hemisphere to reach space. Not orbit, just into space.
Just three years after starting.
Yeah. Yep. And with like 80— I think we had a total capitalization of under $100,000 New Zealand dollars, which is like $60,000 US at that point. So—
Wow. And to think there's billionaires starting companies now that don't actually reach space.
This is true. Yeah. I think one of the success stories of Rocket Lab has been we have this saying— well, it's actually we stole it from Ernest Rutherford, and that's why the engine is called Rutherford— is he said, "We have no money, so we have to think." And that's kind of the ethos of the company. We came from very humble beginnings, and on that rocket actually is like Swagelok fittings that I'd salvaged from a junkyard.
Well, yeah, cuz I could only afford the ferrules, not the cost of the fitting. So, I would get the fitting from the junkyard and buy the $3.20 ferrules to put in it and recondition it into a fitting, you know. So, it was seriously constrained stuff. But from that adversity comes good ideas.
And then in 2010, we won some work with DARPA and developed a new kind of propellant and propulsion system. Did a little InstantEye, a rocket-launched UAV, and then 2013 is really where we started to grow up. That's when I went out of New Zealand and came here to the United States and started raising our first venture capital. Khosla Ventures were the first folks to put in some venture capital into the entity, and at that point we flipped from being a New Zealand company into a US company. Khosla put $5 million in for the Series A round, which you know, at that time for me that was the most insane amount of money imaginable.
For that, we got our first 3D-printed Rutherford engine hot-fired and proved out a whole lot of composite structures and stuff. Then did the B round in 2014 with Bessemer leading that. And then 2015, we broke ground on our Launch Complex 1 in New Zealand. So that was the very first private orbital launch site. 2016 we finished it. 2017, we launched our first vehicle and we raised our D round, which we became a unicorn at that point. That's when—
Things started to move a bit. Yeah. And then 2018 we launched three rockets. And probably the fourth rocket in the stable there, number four, was one of the, I guess for me personally, one of the more satisfying ones because prior to this, I was a kid sitting in New Zealand dreaming of working for NASA, like this little plastic space shuttle that would sit in my desk beside me. And then when I started my career in engineering, it used to sit on the top of my toolbox, and then the top of my laptop, and so on and so forth. I never really got to be employed by NASA, but I got to launch their payloads. So that was—
And you couldn't be employed by NASA because you didn't go to college, right?
Yeah. No, I was objectively too dumb, and also a foreign national. So, foreign national, no degree. It wasn't looking good.
How does that bleed into the culture here? I've heard that you're a eight-wire or a wire-eight type of person. What is that?
Oh, no. It's a New Zealand saying: number eight wire. I actually personally hate it because it means— well, it's got two connotations in New Zealand. It means to bodge stuff together, and I'm the opposite of a bodge stuff together kind of guy.
But its subliminal meaning is more making do with not much, which I think is technically accurate.
Yeah. So how does that, even from the beginning, how does that bleed into the culture today?
Well, today, if you look at what we achieve with the amount of capital resources that we expend, it's always pretty significantly better than most people. For example, the Electron rocket, I think it was under $100 million and 80 people put the first rocket into orbit.
And at the time, our nearest competitor was Virgin Orbit, and that was funded by Sir Richard Branson. And in the end, I think Richard put $1.2 billion into that company before it ultimately went bankrupt with a handful of launches under their belt. So, yeah, we are never the most well-financed, although as a public company we're certainly much more endowed than we ever have been. But it's sort of hard-baked into the culture here that everything is ground right down to the very last bit.
There was an interview we did where someone mentioned that startups often die from indigestion of funding.
Totally. Absolutely. If I look back and think of lots of startups that I've seen or been involved with, the ones that have failed most spectacularly have been the ones that have been funded the most significantly.
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Yeah, so there was a couple of reasons to go public. One kind of logically and one kind of almost— well, sort of logically, but personal. And I think being a public company teaches you extreme discipline. Like you can't be messing around as a public company and wasting capital and not delivering. So the company has always had a really strong culture of delivery, but as a public company it's just even much, much more intense. And then sort of the personal reason why I wanted to take the company public is I'm trying to build a multigenerational space company, and so many companies in this industry are defined by their founders or a small group of people. And if you have to ask yourself, like when they ultimately kick the bucket, what happens to those companies? And the only thing that my parents ever said to me as I was growing up was have impact; have the most amount of impact in your lifetime. So you can have an amount of impact when you're alive, but if you can keep that impact going after you're dead, then by proxy you have much, much larger impact.
So the idea here with going public is is enforcing that discipline so that when I'm long gone, this thing just keeps going and going and going and going. Whereas a private company, it's like if the founder, CEO, and all of that just cuts it one day, then what truly happens to those companies? It's interesting cuz this is when you start making a heavy amount of acquisitions, which has become one of the defining factors of the company as you build out the entire platform. Like you're not just a launch company, and I think that's a big misconception. You do a lot of components and space manufacturing and that kind of thing. So how do you see the evolution of Rocket Lab as we look through this entire timeline and what goes forward?
Yeah, it seems to just be a constant exponential ramp up. That's certainly what it feels like. And to your point, 2021 was a very busy year. We went public and acquired three companies. Don't recommend that. That is really painful.
Why? Because of regulatory stuff with each acquisition or—
Well, anytime you acquire a company, it's like— you go out to a used car lot. They're going to hate me for this analogy, but you go up to a used car lot and you look around a nice big polished car, and it all looks great and it's all shiny. And then it's not until the drive home that you realize that like the visor is squeaking, the wheel's rumbling, and all of the things that just aren't quite right.
So there's no such thing as a small acquisition. And ironically, like some of the smaller companies have consumed vastly amounts more time than some of the bigger companies. So it's just a lot of work to integrate a company in and aggregate all the financial systems and get the culture where you want it. It's just a huge piece of work. So doing three at once was just— that was not fun. But ultimately it was great; we got there in the end. But to your point, I think people focus on the rocket because it's the big firework in the sky and everyone gets emotional and it's all very cool. It's hard to get emotional about a reaction wheel, a little star tracker, or a little component that goes into a spacecraft. But the reality is that launch is a huge moat, but all of these spacecraft components are huge moats as well because it doesn't matter how much capital you've got. If you turn up tomorrow and say, "I want to build a thousand satellites," good luck. It's just not happening because the supply chain is so small and fractured. So we saw that to get to this end-to-end space company and our vision, we needed to own all the components that go into the spacecraft so that we could literally build any spacecraft we want.
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Yeah, one of five. This is generally for satellite operations. Sometimes we'll do launch vehicle stuff in here as well, but it's mainly for satellite operations. So this mission control has seen some really cool missions. A couple of spacecraft, EscaPADE on their way to Mars, that was all controlled out of here. The CAPSTONE mission to the moon we did for NASA a few years ago, that was done out of here.
You did it out of this location? Oh, wow.
Yeah, and New Zealand actually, both, because it was a 24/7 operation, so the control room would just hand off. It was one of the advantages of having things in opposite hemispheres is like it's always sunshine somewhere. So, yeah, it was really good.
Did you discover anything on the moon that you can't share, but you're going to share today?
No, no aliens. That mission was actually the very first part of the program. So we went into a really weird orbit that the Gateway mission was going to go into to prove that that orbit was stable. So it was a crazy, crazy mission. In fact, that's the CAPSTONE spacecraft behind us, the engineering—
That one went to the moon?
