While the stock market has a relatively quiet period every August, the space industry has been buzzing with activity, from recent SPACs to upcoming IPOs.
Spacetech’s SPAC trend arguably began in 2019, when Virgin Galactic merged with a special purpose acquisition company that was already trading on the NYSE. Then came SPAC deals for other space companies, many of which make small satellites.
Astra Space went public in July after announcing a SPAC merger in February, bringing its valuation up to $2 billion. Spire, another small satellite company, went public in August after raising $265 million. Satellite imagery company BlackSky also took the SPAC route, raising $283 million in its NYSE debut on Monday.
There’s still plenty of SPAC skepticism among investors, who view the blank-check deals as a risky way to bypass the IPO process, which typically requires more time, money and red tape. Because SPACs are just companies that have already gone public via IPO, space startups are seeing them as a shortcut to get publicly traded.
Spacecraft maker Rocket Lab is one of spacetech’s bigger public debuts this year. The company announced a SPAC merger last month, making its public debut on the Nasdaq on August 25. Rocket Lab’s valuation soared to $4.8 billion after the deal, and it plans to use its $777 million in proceeds to build Neutron, a larger rocket comparable to a Russian Soyuz, which would position it as a worthy competitor to Elon Musk’s SpaceX.
Peter Beck, who has already been called “the New Zealand Elon Musk,” founded the company in 2006, and much like Musk’s SpaceX, Rocket Lab builds every vehicle in-house from scratch. The company is also partnering with NASA for two upcoming missions — one called CAPSTONE that will send astronauts to the lunar surface, and the other, ESCAPADE, that will send two spacecraft to explore Mars.
Virgin Orbit, not to be confused with Richard Branson’s other space company, Virgin Galactic, announced last month that Boeing would invest in its upcoming $3.2 billion SPAC. Boeing already invests in Virgin Galactic, which deals in space tourism as opposed to Orbit’s satellite-launching focus.
One of Virgin’s unique features is its launch method: Instead of a vertical rocket launch, a converted Boeing 747 launches a rocket into orbit carrying the company’s satellites. Branson used the same launch method for his infamous spaceflight in July.
It’s not clear exactly when Virgin Orbit will go public, but the company is well on its way to becoming a rival of SpaceX, which currently dominates 30% of the $9 billion launch market.
Unlike most space startups going public, Voyager is planning an IPO as opposed to a SPAC. The Denver-based company is aiming for a $1 billion valuation, and plans to make its debut in early 2022. It’s currently working on raising capital with the help of JP Morgan, according to CEO Dylan Taylor.
Voyager is also much younger than most other space companies. Founded in 2019 by Steve Ehrlich, Voyager specializes in TK. The company has also used its capital to buy up smaller space tech firms — most recently a majority stake in Nanoracks, which built the first private airlock on the International Space Station.
Not all SPAC mergers go smoothly, as was the case with Momentus, a space company that makes water-based plasma engines, among other products. Momentus completed its deal and went public in August after a year of negotiations which resulted in the departure of its founders and a new CEO, John Rood. The original founders, Mikhail Kokorich and Lev Khasis, who are both Russian, were ousted after unspecified national security concerns were raised.
But Momentus’s problems didn’t end there. Its valuation was slashed in half from $1.1 billion to $567 million, followed by an $8 million SEC fine. According to the SEC, Momentus misled investors and falsified results from a 2019 prototype test. The company posted no revenue last year or this year, and expects just $5 million in revenue in 2022.