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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