Despite being a knight, billionaire, and British, Sir Richard Branson just can’t keep it up for Virgin Orbit. Now, the satellite launch corporation is on the chopping block as they look for prospective buyers. Based in California, the 750-member company will be laying off 85% of its workforce almost immediately.
Virgin Orbit’s leader Dan Hart told the press had “taken great efforts” to safeguard their funding as well as raise more capital, but sadly “we ultimately must do what is best for the business.” The goal is now on finding a buyer for the business, “to provide clarity on the future of the company to its customers, vendors, and employees.”
It was formed in 2017 as an offshoot of Virgin Galactic, a space tourism company. At their UK satellite launch, a rocket fuel filter became dislodged, thus the engine overheated and the mission failed. Originating from Spaceport Cornwall, near Newquay, this launch was seen as a true milestone for the future of UK space exploration. After the disaster, funding dried up and backers withdrew support.
Despite being publicly traded on the NY Stock Exchange since 2021, their $153.5 million of losses last year made the investment a rather risky one for anyone to try and take on. April 4th saw Virgin Investments (another arm of Virgin Group) offer up $31.6 million in capital to guide Virgin Orbit through the arduous process of finding a buyer.
Filing for Chapter 11 bankruptcy protection, the company has limited actions it can do now asset-wise, but as per expectations Sir Richard’s kingdom is safe, and the wasted taxpayer incentives he received remain just as gone as his ambitions of space. Most concerning is the explanation from former President Will Whitehorn. Instead of accepting their failed premise, he has, instead, coupled the failure at Spaceport Cornwall with the collapse of Silicon Valley Bank. As far as he sees it, the two caused the downfall given their timing with the attempts to raise funds.
Yet, Whitehorn isn’t very worried about their future. “What you have got to remember is they have got nearly 50 satellites into space already, so I think there’s a chance they’ll be back.” Thankfully Spaceport Cornwall was smart enough to have deals with other companies like the US-originated Sierra Space.
Melissa Quinn, head of Spaceport Cornwall calls Virgin Orbit’s news “very sad,” but they always will “remain focused on furthering the international space industry.” As the only spaceport in the UK, they have a monopoly on the idea, and given the unique topography and layout of the nation, it only makes sense to bring space travel to the island.
With what Hart calls “cutting-edge launch technology,” there should be no shortage of buyers for the company. However, that technology isn’t all in a fully proven state, so many will have to wait until that changes to see the full potential of the company. For many, the risk isn’t worth the reward, especially as Elon Musk’s Space X has dominated space exploration, and is even giving NASA here in the US a run for its money.
The UK Space Agency is performing at an incredible rate, and generating £17.5 billion in income is no laughing matter for the nation. With the UK space sector flourishing, the loss of Virgin Orbit does little to the market besides tarnishing the crown of Sir Richard just a little bit. Then again, much like many other billionaires, this is just another failed venture with lots of learning lessons.
By keeping Virgin Orbit separate from himself and other Virgin lines, he once again escapes any real problems for the company failing to produce at the level he anticipated or that investors expected. Now as the pieces are picked up for the company, he’ll dust himself off, collect a nice profit, and ride off into the sunset. And he’s likely to reinvest in Virgin Galactic since that space program has been wildly profitable despite doing little.