There's a bit of a symmetry to this, we started the event talking about raising growth rounds. And also, we started that session with a discussion of snacks. So we have a panel dedicated to that very topic. And in general talking about taking your space startup public, so to explain, please welcome. killin Brandon from Astra who will be joining us virtually on the screens. Andrew rush from red wire, Adam spice from Rocket Lab and your moderator is Devin Coldewey. Thank you for
joining us. And thank you, Darrell for stealing the joke I was gonna use to open my panel. So really good start for us. And thank you, Kelly, for joining us via zoom. I hope you're I hope you're feeling better. So I think we can we can assume some general knowledge about Spax in the audience here. So we don't need to go into the details of what exactly one is. I think we learn more if we just hear from you all, how and why you arrived at this as the the choice for moving forward in for your company, because you are all very different companies. And you all chose this for different reasons, I'm sure. So Kellen, if, if you wouldn't mind starting out, I'd love to hear why you went with why you went with the SPAC?
Well, it's it's interesting. Previous to this dispatch process, I've taken two other companies public and in a traditional IPO. But really why the SPAC was right for Astro was that it allowed us to accelerate our path and our roadmap. And quite frankly, we would not, it would have taken a lot longer to be where we are actually today without the spec process being available to us. So for us, you know, our business is capital intensive. And so getting out to the public markets allowed us to really accelerate.
Absolutely, the speed is obviously a big part of it. The the IPO process, I haven't tried it myself, but I hear it's kind of rigorous. Andrew, you have any other any reasons we should hear about?
Yeah, I mean, I would, I would classify red wire as a public space company, not a spec company. Sure. And, you know, our, our focus is on enabling, you know, enabling people to participate in this second golden age of space to be to help build that very, you know, next infrastructure in space. And that's a longer, that's a long term view, you know, we're just on the doorstep of the future here. And being a public company, really sets us up for that long term success. And so that's why that's why we strove to be to become a company when we did.
Yeah, I'd say for Rocket Lab, when I joined about three and a half years ago, you know, Peter Beck, and I really thought that a traditional IPO was going to be our path. And I think, you know, having, you know, multiple years of revenue, made that a real possibility for us. But I think what really made us pivot towards this, the SPAC was really that the quantum of money that could be raised, right, so given the pretty, you know, ambitious plans for neutron or larger launch dates, in particular, it that's something where, you know, the amount of money we could raise traditional IPO would have pretty much consumed all have that right, and left us with anything else to go pursue other things, which we've been doing a lot of other things. So it was really just the size of rays that we could do was really what drove us in that direction. But I would say that, like there is no free lunches, it's not such an easy process, it's not typically quick process, I think it's got a lot of unique attributes to it that make it difficult to start your life as a publicly traded company versus an IPO where you can really kind of build that institutional shareholder base as you kind of go through your process. So it's, it certainly doesn't come without trade offs. For sure.
I'd like to hear more about the benefits of being a public company, because it seems to me this is sort of how I might ask it for like, my friends who don't fully understand the differences here. We have a lot of goodwill, a lot of capital in this industry, a lot of interest in launch in all kinds in like, you know, on orbit operations, and there are companies that are raising hundreds of millions of dollars in their series, you know, e f, g, all these, like, just a huge amount of money coming in from private investors. Why Why not go that way? Why not stay private? Why not seek one of those huge private rounds? Anybody?
I could take a stab. I mean, from, from my perspective, so much of it, you know, like in any business is about the people, right? And so I think that, you know, giving people liquidity and letting them kind of realize the, the fruits of their labors that in many cases take span many, many years. I think the people view the equity very differently. Now, as a publicly traded company. It's allowing us to recruit a different level of experience because there's a certain view of like, you know, longevity that's kind of assumed when you have hundreds of millions of dollars on your balance sheet, and you've got a public currency. So I think probably the big biggest enabler of it really from you know, how it can change the business is just the fact that you can attract a different type of talent, and you can retain the talent, because they now see value in wealth creation for themselves. So I think that that that to us is very powerful.
I mean, I think I think those are great points, right? Like, it can't be underestimated how important it is to attract and retain top talent. And having that public currency really, really helps. But I think there's a broader look in the financial markets in a broader way, it's never been easier to raise money. As a space company, it's never been, and throughout the entire lifecycle of a, of a space company, right. And so I think having, like now, today, having not only remote sensing companies, telecommunication companies, launch companies, but companies focused on infrastructure in a wide variety of ways, being able to, you know, access everything from seed to, to going public, and you know, and capital in those markets, really is enabling us to be very, very successful. And that that wasn't true. Like, three years ago, that wasn't true five years ago, that wasn't definitely wasn't true a decade ago. So I think you're seeing companies go public now, because it's the right time for them in their cycle, whether it's capital, or attracting and retaining talent, or having that sort of forever home platform. It's just
a lens that does that tally. With your experience, you talked about the speed, but is it also about the stature and the the being a public company?
Absolutely, I will tell you as we were going through the process, and certainly now we've, we have hired some of the best talent, you know, out there, and certainly being public. And having that currency has helped us recruit, you know, we pull people from the automotive industry, from the space industry from, you know, software companies. And it's allowed us to attract a lot of talent, which is very competitive today. I'd also say that having that currency opens up broader m&a activities for us as we think about our product roadmap, when we think about, you know, what our strategies are. So being a public company, and having that current currency in our back pocket for a bill versus buy. scenario is important.
Gotcha. And just really quickly, I feel like maybe we should try to there's, there's correlation. In the last couple years, we've had COVID-19, and like very weird markets, all kinds of stuff going on. And at the same time, there's been a big boom in Spax, as a vehicle for taking a company public. Are these things related? Or are they just coincidental? It feels like there must have been something to do with like, you can't go You can't IPO when pandemic is raging, and you're a little more unsure about your stature or your your standard. You think they're gonna do you think they're connected? killin?
You know, they, when you pose the question like that, they may be I can tell you that, you know, the biggest impact of COVID Certainly, for Astra was, you know, as you think about doing, you know, at that point, they would be looking to do their seed round, you just saw that from the investment side kind of private equity, the funds dried up. So that was, you know, the biggest impact. But when you post a question like that, it could be it could be related, because suddenly, when the investment started opening back up, there was opportunities with a variety of different different specs. And I think it just accelerated, accelerated our opportunity, and we were able to bring in a significant amount of cash.
Any thoughts on that? Yeah, I
mean, I'm, it's above my paygrade, to tie the macro economic background economy to, you know, a global pandemic and how those two things interact.
Above your pay grade, think about my pay.
I, I do think that an element that all three of our enterprises have explored is the is, you know, m&a. And there are certain classes of company that really found that, you know, that they started thriving and COVID. They're showing us as a company that maybe had more struggles, you know, due to the pandemic. Some of those don't haven't quite fit, you know, haven't quite fit the profile from from an acquisition perspective, but that certainly has, I think, driven more conversation potentially has driven more conversation. In that, that portion
of it, I don't want to assert that there is a causality here or anything, but I just thought it was important to sort of either doesn't try to disentangle or, you know, acknowledge the possibility of these things being related to connected.
Yeah, I don't know. I think it's probably more a function of the fact that there's been just the world's been awash in capital, which you can maybe attribute that to all the stimulus that's come from the pandemic and everything else. I think there's just been a bigger a greater appetite for risk assets. And certainly, you know, space assets are risky assets, you can vary growth he of course, as well. But I think that, to me, I think it's if there's any connection to the pandemics, probably that and I think, you know, also didn't hurt to have the two richest people on the planet promoting our sector on a daily basis, right. So having Jeff Bezos and Elon Musk being out there being the poster people for space, I think it's attracted a huge amount of attention. And a lot of ways, maybe too much retail attention. Like, you know, I know that particularly, you know, in my stock, we have a very high percentage of retail holders. And, you know, that can be a blessing and a curse, right. But I think it's just such a sexy area right now. I mean, I never would have predicted, you know, 510 years I don't come from an aerospace background, I come from a semiconductor background and the how many people are just so fascinated with space right now that it's it's it's much broader out there societally than I ever would have predicted. And I think that has driven some of the the investment enthusiasm as well.
Now, Andrew, you mentioned that this that people are people are taking this route, because it's the right move for them the right timing, the right, the right positioning, but all three of your companies are at very different stages. And I'm wondering, how can it really be the right solution for three? So very different companies? You know, is it really that flexible of a financial vehicle to, to be able to be the perfect, you know, it just happens to be that everybody went for it and got a ton of money all at the same time? Because it was a perfect fit for everybody. Right? So I would I would like to hear a little more actually, let me enter all the shoes since I've picked on you just now. I'll let you let you respond to this. Why do you think this is really the is this really the best vehicle for for you and for this company going forward?
I mean, yes. Okay, nevermind.
Really sorry. But I couldn't continue because you're talking about like, you mentioned, like having a couple years of revenue is like a good thing to have under your belt. red wire has got all these like acquisitions, and like you're, I'm interested in where you're going to go forward with that. But I'd love to hear why, like your reasoning why it really is the best choice for you. And then I'd like to hear from Kellen as well.
Yeah, I mean, I think I think the lens is being a public company. Yeah. Right. Because whether it's traditional IPO, this background or direct listing, the net effect of that is that you are a publicly traded company. Yes. And for us, being a publicly traded company, is is the vehicle is the right vehicle for us to be a great mission partner, for our customers and for our stakeholders. And to, you know, help them you know, play our little part, in, you know, in this second golden age of space, because it is a transformational moment that we exist it but it's a moment, it's in moment isn't even the right word. It's a transformational time, right, it's gonna take years for us to go from where we are now to, you know, people living you know, to substantial numbers of people living and working in space to 50,000 60,000 satellites and Leo to sustained lunar exploration by humans. And that's that's a fantastic goal to be working toward and be playing a part in and being being a publicly traded company being a public enterprise and working toward that goal that that was the right fit for us.
In killin I want to ask an Astra seems to be at sort of a pivotable pivotal moment in its in its history, like you are going to be like really ramping up launch and getting starting to do real missions to orbit all this kind of stuff. This is like right around the corner. But it's a very, it's a you're still in a very high risk stage. How do you account for these very divergent paths that your company could go down where it's, you know, when does your over, you know, which of these launches will be like the launch that sets you on the path to your revenue and your in prophethood, prophethood profitability. But then there's, you know, there's also the other alternatives where it may take a little longer, there's delays, there's all these kinds of things. It just seems like this is such a, this is such a watershed moment for the company, and taking that taking this this route. It seems like it could go either way. How do you account for those with the with the financial situation that you have now?
Well, you know, I, so, that's a lot to unpack. Yes. It's okay. So, we reached a real milestone in November by launching and reaching orbit, congratulations, by the way. And, and we did this and really record time. You know, we're now working on our launch that we've announced that's in January, that will be at a separate as a second site for us at Cape Canaveral. You know, some sub you know, and and the, the spec process has really, it's a process. It's a vehicle we're now a public company, but being able to kind of build proof our balance sheet has, I believe accelerated, you know, our our hitting COVID Based on the talent that we've been under the hire when we came in. So again, I like the I like the thought that the dispatch is a process or vehicle. But once we started trading on July 1, we were a public company. And I think being a public company aligns our employees and our investors and our strategy all together.
I'll take a bit of a contrarian view on this. Well, I actually think that this this party is gonna end very badly for a number of companies. I think it's a, I think it's a lot of ways is a dangerous product. I think that you have to be the right fit for it. I think it's, it can be viewed as a de risking tool for founders. And for VCs. I think that it's, you know, transferring the risk to public shareholders, before the company's got, has proven technology and customers. And the market, I think, is, it's, to me doesn't sound like real recipe for success. I think that eventually, once the dust settles, I think you'll find a lot of companies that are going to be trading for under cash value, and will be an opportunity for people to pick those bones, if you will. It reminds me a lot, again, you can draw on your, you only can draw on your own experience. But spending a couple of decades in the semiconductor industry, it reminds me a lot of the late 90s, early 2000s, during the.com bubble, when a lot of companies came public before they should have, and they became the Walking Dead. And they were over capitalized by a bunch of passionate founders who didn't want to get out. And I think you end up in a situation where it can cause challenges to pricing, and a lot of other things in the market. So I actually don't necessarily see this back. Wave is a great thing for industry. I think, again, I I don't see necessarily happy ending for a lot of companies in this in this in this path.
I guess you're young, I was actually I was going to bring up some of the criticisms. Of course, there are many, as we all know, but I would like to give you two chance to respond to your thoughts, Adam. But I would like to ask also, do you agree that there is a sort of fundamental elements of risk shifting towards future investors towards the public investors in that is inherent to the stack process?
I don't I don't think it's about I don't think it's about risk shifting. I think that two thoughts and I appreciate appreciate your view, and your your experience. But I think that we for the first time in our sector have access to like the full suite of tools of financial tools. And we're we are a capital, in general, we're a capital intensive sector. There are elements that aren't for sure, but we in general era, capital intensive sector, and having access to, you know, soup to nuts, from angel investors, to VC to private equity, to, to public to the public markets, lets us actually, you know, give effect to well reasoned business plans, and, you know, products and, you know, introduce products, where that wasn't really the case. before. I also think that it's awesome that there are more pure play space companies that are publicly traded Now than, than there were a year ago that that people can, that there's an element of like the democratization of space in that, that, that, that that folks can in, you know, in well regulated financial markets, you know, participate in, you know, participate in, in the space sector in a way that previously, there just weren't really, really any any options,
right? It just caused me concern when you see companies that couldn't raise money in the private markets, raise huge amounts of capital in the public markets, from what arguably could say be less sophisticated investors than the private markets. So I agree with Andrew, I think the democratization of space is a great thing and something we all strive to deliver. And I do think that, you know, people pick their investments wisely, I think this could be a really good thing. There's some great companies that are that are in space market, especially this new space. But I just, again, I just I just think that you see, it just doesn't strike me as common sensical, were companies that struggled so hard, and in some cases, were on the brink of going under. Now all of a sudden had access to hundreds of millions of dollars and billions of dollars evaluation, that just I think I just can't make the I can't converge those those kinds of environments.
You kill him. You have some some thoughts on this.
Well, just you know, you can't discuss the risk right? If you think about investors coming in, into your business even if you are pretty revenue, you can't discuss the risks without discussing the opportunity. And what this allows is that it allows companies that, you know, wait longer to effectively get publicly listed, you know, will stifle the ability for investors to join in on the growth and Spax. And this process gives him the opportunity to join join at a at an earlier stage.
I can appreciate that. And of course, the nobody's going into these things completely blind, there is some amount of due diligence being done. But I What about, are there? Are there technical aspects that people should be more aware of? Like? Is this a specific structure of like the vanilla spec that a lot of people have taken? Is that factor into this? Like, are we going to see the the instruments or evolve into something a little more less controversial in some people's eyes? Or is that really not
matter? I don't think it's a I don't think it's a structural thing with Spax. I think, you know, the warrants and all those kind of things that go along with it. I think that challenge the fact that, you know, you've got it space business, you pick launch pick, you know, spacecraft, it's incredibly complex, right. And I just think that, that I wonder whether people really can assess risk appropriately, on such complex products. And I think that's why I think that's why having a track record of revenue is so important before you go to this process, because by the by the fact that you have revenue, means you're delivering something of value to a customer, that hopefully, if you got multiple years of that can it can can basically imply that there's less risk. I just think that you take a lot of these companies that have such high retail investor holdings. I just can't imagine that those folks really able to assess the viability of launch platforms, for example, or other complex space based businesses. I just, I just have a hard time of that.
I think that one of the things that you were you're hitting on earlier is is relevant here is that is is that not, not all of the space backs are the facts are actually more different than they are the same. Right? I mean, we had red wire of 50 years of flight heritage, but we we put four new in space manufacturing capabilities in space, in the last 15 months, we put new, new Roelof l Ray technology on the International Space Station and more recently deployed, supporting Qatar mission. It's, you know, and looking forward to the launch manifest, it's, it's really, really quite full and fascinating for us. Rocket Lab is, you know, is quite a talented and amazing company, I think from from a launch perspective, and from an emerging face Systems Company, Astro, the same thing I and we have, we have other companies in, in our, in this cohort of space backs that are, you know, that have different models that some are free revenue, some are generating some revenue, some are no, some are profitably operating. So, I would hesitate to draw conclusions, you know, to paint with a broad brush about, about what facts mean. And, and, and, you know, whether they whether the investor can handle it much in the same way that I think if you look at the automotive sector, you it would be difficult to make the same sort of statements, right, you have, you have, you know, early stage pre revenue or barely revenue companies, you know, you know, like revient, maybe, you know, maybe Rocket Lab is the rivian of, of, you know, of the automotive sector versus you have
we generate revenue, but yeah.
Because we will hold a conference
versus, versus like a, you know, versus, you know, versus like Ford or Volvo when they had a more long standing base there. That, you know, so there are parallels and those, those are, that's an extremely complicated and sophisticated sector as well. Just Just like our sector. Absolutely.
Going, you wanna, you want to chime in on that, I bet you people looking thoughtful as well?
Well, no, I, you know, I hear what you're saying. And I'll say, during the spec process, the retail portion, you know, is much higher than I've seen in my previous IPOs. Having said that, I would not I would not put down the retail investor. They're smarter than you think. It makes me think about how I want to versus, you know, just meeting with institutional investors, I have to have a different kind of platform and form to get to our retail side of that. But I think if you're relatively transparent, and you're, you know, you're executing against the plan that was there, you know, I think, you know, I think the investors get them via you know, whether they're retail or whether they're institutional.
Right and I was just this thought just kind of occurred to me that the one of the things that goes into this the process of retailing, Esther's mindset, of course, when they're looking at a company like Rocket Lab, of course, and they see this, you know, a steady launch cadence and a lot of established value. Astra has a unique approach to, to launch, which is going to be a totally different thing. And read why you've got like this collection of talented companies that you've like, are getting ready to, like, deploy in this like, amazing new direction, but it feels like you've got different bets from different investors, like you've got a you've got a bet on reliability or something like that a bet on ambition here and then a bet on ingenuity or something. I'm just making these words up. But yeah, there's like there are these different ideas that people are making these choices? It's but in your case, I feel like that's more of a a bet on leadership and on the ability to capitalize on what you have, excuse me, what you have gotten ready to deploy. Do you think that that's, is that does that make more pressure on you as at the, you know, leading these companies to to follow through on the promise that is sort of implicitly made here?
I think that we all are equally. I'll speak for Caitlin and Adam, for a second. I think we're all equally dedicated to certainly
to delivering for our because really, I would not question anybody's
you know, that's, that's that's job one. Right? We're, we're customer focused, we're mission focus. And certainly, our our approach is just his, you know, his his heritage plus innovation is this is to have this great foundation of technologies that are that have delivered value for a long time for customers. And then two, and then to add on the the innovate the innovation, to say, Okay, we're a trusted mission partner for, you know, for deployable structures, for instance. Well, there's also a paradigm where we can, you know, we're now we can have a conversation about assembling and manufacturing spacecraft in space, and you get that much more value more capability on orbit. And we find that having that foundation of relationship of trust with the customer, plus, you know, plus the innovation is, is meaningful for as meaningful for our customers and meaningful for our stakeholders. And, and, you know, I can't I don't, I can't, I don't pretend to be able to read the mind of the investor. But that seems to be something that they they respond well to respond to, as well. Gotcha.
Well, we only have a couple of minutes left, I wanted to ask a look a little further into the future. And do you think given given the restrictions on like, the space industry of just like having longer horizons for revenue for profit, needing that huge upfront investment? Is there? How do you expect the investment market to change over the next couple of years possibly as a consequence of Spax? Whether they go well, or badly or you know, big mixes? I'm sure they will be? How do you expect regulations and new investment types or strategies to change over the next couple of years? In the wake of all this? If you want to go first killer?
Yeah, it's a great question. I think it really depends on how successful I'm thinking about our sector, in particular, how successful we are at executing, you know, you know, investors are investing, you know, we have over 50 launches that was in our that's in our backlog that we may not have revenue, and and, but we do have contracted revenue that's coming up. So I think, I think I think as it depends on how successful we are, and, you know, and is the flavor of the month right now, kind of the spec process, you know, I think you're going to see over time that maybe a little bit more of a balance between the different funding vehicles that could be out there, but and I think the SEC is going to keep a weather eye on specs, right, as we've, as we've seen, as we've seen, through our process,
certainly the excitement will be initial excitement will dive down, we'll see more of a balance. A lot of I don't know, which, which of you would like to have the last word on this, but you can flip for it.
I think that that I think the performance is going to you got to deliver, right. So I think, I think you know, you get out, you kind of get through the either the either needle through any public process, right? Once you do that, then it's all about delivering against what your commitments were. So, you know, I've had a lot of meetings, you know, with a lot of investors over many years, where they'll pull out their notes from five years earlier. And they'll say, remember, when you were in New York back at this date, and you said this was going to happen? Well, either congratulations, you guys lived up to what you said you were going to do, and we're happy investors and we'll support you going forward. Or they'll say what the hell happened? You know, why did you go so off the rails? And you know, why should I give you more capital? Right, why should continue to support so I think you'd have to use like anything else? I mean, space, semiconductors, commodities. I mean, at the end of the day, you got to deliver your business plan. I think if you do capitals gonna be available.
Depends on delivery depends on delivery, Andrew?
Yeah, depends on delivery. Okay.
You want to elaborate or should we end on that?
Yeah. Well, you know, for us, as I was just talking about a little bit earlier, like we, you know, we've we've delivered favorite property with delivery a lot of products this year. And actually in next well, on December 21, we've four additional payloads that are flying up on on SpaceX 24, to the space station. So we're continuing that cadence. And that's, you know, I think I think that's what we we pride ourselves on. And I think it's great to have, it's great that there's a lot of room for innovation for innovation and new approaches, because that's what we will need to to really deliver on the promise of this next golden age.
Certainly. Well, I'll be looking forward to the deliveries from all your companies. Best of luck in your endeavors. And thank you very much for joining us has been extremely informative. Thank you. Thank you.