Sir Peter Beck created Rocket Lab by developing a wide range of skills over a long period in New Zealand before its launch in the US as a space unicorn.
Pete Beck’s Attention to Detail Enabled Rocket Lab to Soar
There was a lot of excitement generated a few years ago by the idea of space tourism, as celebrities and wealthy individuals boarded the initial suborbital flights of the likes of Richard Branson’s Virgin Atlantic and Jeff Bezos’ Blue Origin.
Elon Musk took some of his attention off down-to-earth Tesla Motors and the virtual world of X (ex-Twitter) and put it on SpaceX, whose satellites power much of the internet while it helps NASA develop new space capsules for astronauts.
But most of the efforts to commercialize space in one way or another have fallen back to Earth.
“At one point we counted 140 companies trying to do what we do, which is mostly carrying spacecraft with satellites on top of our rockets and releasing them into orbit,” Peter Beck, founder and CEO of Rocket Lab USA, Inc., told Startup Savant. “Since our first in 2017, we’ve deployed 190 on 50 Electron rockets as of June 2024, the fastest of any privately-held company. “
Satellites serve as essential relay stations, delivering a wide range of reliable and cost-effective communication services such as TV, radio, internet, mobile phones, as well as GPS for navigation and weather forecasting. They also support critical command-and-control functions across land, sea, air, and space. Despite their vital role in everyday life, most people remain unaware of this infrastructure and often take it for granted, he noted.
“Putting something into orbit is a very, very difficult thing to do, like running through a maze at night, and we’ve also enabled 1,700 missions of wide variety, including functions of the James Webb Space Telescope,” he said. “Our potential competitors have mostly been aspirational, trying to convince customers that they can deliver services at a lower price, even though they’ve never launched anything but a trendy video. We are the only end-to-end space company, designing and building the spacecraft, then launching and operating it. We also manufacture the rockets and can provide the satellites, as well as components and software for others in our industry, all at our headquarters in Long Beach, California.”
The main launch site for the Electron is in New Zealand, while a new, much larger rocket in development, the Neutron, is being tested on Wallops Island off the Virginia coast, where it is expected to begin commercial and government launches in mid-2025. Two-third of the company’s 2,0000 workers are based in the US and it has acquired a handful of specialty firms in Maryland, Colorado, Albuquerque, and Toronto.
“SpaceX has revolutionized big rockets and we’ve done that with small rockets, while governments are gradually getting out of the business, since we can do it more cost-effectively,” he explained. “Rocket Lab launches every couple of weeks, putting it just behind the US, China, and Russia in frequency. The Electron can carry a payload of up to 700 lbs., typically to orbits around 310 miles above Earth, but also as high as the Moon. The Neutron will have a capacity of as much as 15 tons, with a reusable first stage that will land on a floating platform, similar to the recovery of Falcon 9 by SpaceX.”
“We can get to low Earth orbit, where the spacecraft completes an orbit in 90 minutes traveling at 28 times the speed of sound,” Beck explained. “The satellite will stay up for three to five years.”
Looking To the Heavens From the Beginning
Beck, 48, spent his childhood in the town of Invercargill, with 50,000 residents, at the bottom of the South Island of New Zealand. His father was a geologist and the owner of an art gallery in a museum, while his mother taught a wide variety of subjects in school.
“I was lucky that they encouraged me to not accept the status quo and as it became apparent I was fascinated with rockets, I was told that explosions were fine, the bigger the better,” he recalled. “No university taught anything about space, of course, so I went to a trade school to get the engineering skills I needed to build engines and rockets.”
He then spent eight years at appliance maker Fisher and Paykel, learning a lot of hand skills and eventually becoming a production design engineer. This was followed by a year working as a project manager for a billionaire’s superyacht company and the US government to help those competing for the America’s Cup, working with advanced composite materials.
“All of this helped me understand supply chain management and how to communicate and work with a wide variety of people,” Beck recalled.
By 2006, he felt ready to launch his own company, funded by $300,000 from angel investor Mark Rocket (his real name), and had its first experimental rocket in the air three years later.
But by 2013, he realized they needed a lot more money, and after a trip to Silicon Valley he moved the company first to Huntington Beach, south of Los Angeles, putting Rocket Lab closer to investors, customers, suppliers, and qualified employees. It was moved to nearby Long Beach in 2020 to consolidate operations.
Many components of the rockets are made by 3D printers, so production can be easily ramped up by bringing in more. The company is constantly developing innovations in materials, engines, propellants, and now a reusable first stage. It has also acquired several vendors.
Early venture investors included the New Zealand government through Callaghan Innovation, Bessemer Venture Partners, Vinod Khosla, Stephen Tindall, and Michael Fay. Later, Lockheed Martin saw the potential. In 2010, the Operationally Responsive Space Office awarded a contract to study a way to put a low-cost space launcher into orbit, with the support of NASA valued at $6.9 million.
Then in 2021, Rocket Lab announced it was merging with the special-purpose acquisition company (SPAC) Vector Acquisition Corporation, the new entity valued at $4.1 billion. The IPO as RKLB was on August 25, 2021, starting at $10 and going up to $16 a couple of months later, then gradually sliding down to $4-$5 since mid-July 2022. Beck attributes that to the impact of the pandemic on the market, its volatility due to global economic instability, the depressed outlook for most space stocks, and the public’s lack of understanding of the industry.
The price for a launch starts around $7.5 million and half the customers are commercial and half government entities, he says. Revenue in 2023 was $245 million, two-thirds of that coming from the spacecraft division, with the company overall profitable at $183 million in net income.
“VAC provided $770 million in working capital and we are heavily investing in the Neutron, which everyone expects to be a major game-changer for us and the industry,” Beck explained. “We’re about five years ahead of everyone except SpaceX’s Falcon 9 and it is good to provide it with some competition.”
But Rocket Lab won’t be retiring the Electron once the Neutron is on the market. “We have built up trust with our customers by not making mistakes and being ruthlessly efficient so we can meet our promised timelines.”
In January 2024. Rocket Lab agreed to be the primary contractor for a $515 million project to build satellites for the Space Development Agency, its largest to that point.
June 2024 was another great month for the company and for Beck personally. It signed its largest Electron launch contract ever for 10 flights for the Japanese Earth-observation firm Synspective. And he was made a Knight Companion of the New Zealand Order of Merit.
Sir Peter is ready for his crowning achievement when Neutron carries its first payload into space.