In case of Virgin Orbit it is truly curious. In barely two years, Richard Branson’s company went from being a potential rival to SpaceX, to fighting to prevent its disappearance. And for these hours, he’s clinging to the chance to get some oxygen — fresh money, come on — to survive a disastrous start to 2023.
Reuters reports that Virgin Orbit would receive an investment of 200 million dollars by American businessman Matthew Brown. The agreement would be close to closing and, according to the aforementioned media, it would serve as a “confidence boost” for the firm dedicated to sending satellites to low Earth orbit.
If the contribution is confirmed, Richard Branson’s company could breathe after long months of concern. Virgin Orbit was already in a complex situation, with financial losses and a decrease in available money in recent quarters. However, what really brought her to her knees was the failure of a crucial mission to launch 9 satellites from the UKlast January.
It was the first time that the company had tried to complete a procedure of this type from British territory. However, an anomaly caused by a misplaced fuel filter prevented the rocket’s second stage from functioning properly. LauncherOne —which is air-launched, attached to a modified Boeing 747—, preventing it from reaching Earth orbit. The transported cargo ended up falling into the Atlantic Ocean.
The impact of the failed mission was such that last week Virgin Orbit was forced to lay off virtually all of its staff and temporarily pause its operations. The move was taken as Richard Branson’s men were discussing “strategic options” to keep the company on its feet.
Virgin Orbit wowed the world, but now it’s in trouble
Virgin Orbit is one of many companies trying to carve out a place in the highly competitive market for sending satellite payloads to low-Earth orbit. Although Elon Musk’s SpaceX is the most important reference in the sector, several players have tried to make a name for themselves, especially with the implementation of less conventional methods of launching or recovering the rocketsunder the promise of reducing costs along the way.
Those of Richard Branson astonished the world with a proposal that, at first, seemed nothing more than a crazy idea. It is that, unlike their competitors, they did not use a traditional launch platform for their rocket, but they deployed it from the air using a specially prepared Boeing 747, baptized as Cosmic Girl. And the bet paid off, because in 2021 the company achieved what seemed impossible: launch a rocket into space from an airplane.
That early success led to Virgin Orbit going public later that year after merging with NextGen Acquisition Corp. II, a SPAC or “special purpose acquisition company,” commonly known as “blank check companies.” . So, reached a valuation of 3,200 million dollars. However, in just one year its market capitalization has collapsed. Yesterday, his Nasdaq stock fell more than 14% to close at 44 cents, making his market capitalization now it is only 150 million dollars.
This Wednesday, meanwhile, the stock rose to almost 98 cents in the premarket, after knowing the possible investment of $200 million by Matthew Brown. In any case, Virgin Orbit’s situation remains delicate.
waiting for fresh money
In the last hours, the aerospace firm summoned a small group of licensed employees to work on updates to its rocket. The idea is that the work restarts on Thursday, according to Bloomberg. However, it is still unknown if operations will be able to resume normally once the expected financing is closed. “We want to return to our mission and return to orbit,” they declared from the company.
The other big uncertainty is when Virgin Orbit will present the financial report for the last quarter of 2022. Results for the third quarter of last year, with data up to September 30, indicated losses of nearly $44 million, while cash holdings fell to $71 million, from $122 million in the previous quarter.
Will Virgin Orbit be able to save itself and continue to offer its satellite launch service? Today the panorama is not encouraging, but neither is it definitive. Although it is a warning sign for other companies in the sector, such as RocketLab.