SpaceX fundraising again

[QuantumG]

With nearly 20 launches on manifest between now and end of 2015, cash flow shouldn't be an issue from now on. That is assuming they can duplicate the last launch.

Even assuming that, the customers have gotta be ready to fly. They don't pay up until they deliver their payload.

[Lars_J]

With nearly 20 launches on manifest between now and end of 2015, cash flow shouldn't be an issue from now on. That is assuming they can duplicate the last launch.

Even assuming that, the customers have gotta be ready to fly. They don't pay up until they deliver their payload.

This has been pointed out to you many times, so you should know you are wrong on this. Contracts usually have deposits and multiple payments based on negotiated milestones.

[QuantumG]

This has been pointed out to you many times, so you should know you are wrong on this. Contracts usually have deposits and multiple payments based on negotiated milestones.

Huh? With SpaceX they have a deposit and a final payment. I know this for a fact. If you feel like correcting me, please have your SpaceX guy talk to my SpaceX guy.

* For all the commercial customers so far, anyway. May not be the case in the future, certainly hasn't been the case for NASA.

[Lars_J]

This has been pointed out to you many times, so you should know you are wrong on this. Contracts usually have deposits and multiple payments based on negotiated milestones.

Huh? With SpaceX they have a deposit and a final payment. I know this for a fact. If you feel like correcting me, please have your SpaceX guy talk to my SpaceX guy.

Then we are in agreement. Your statement seemed to imply to me that there was no payment (not even a deposit) until the payload was delivered. My misunderstanding.

[TrevorMonty]

Any idea what final payment is as a percentage.

[Prober]

With nearly 20 launches on manifest between now and end of 2015, cash flow shouldn't be an issue from now on. That is assuming they can duplicate the last launch.

Even assuming that, the customers have gotta be ready to fly. They don't pay up until they deliver their payload.

unless they are NASA.   Remember the claim from that deleted Forbes?

[symbios]

With this official round off investments the sheres have now officialy gone up with 250 % from the last round of investements according to this post (4-10 billion).

This means for all previous investors that they can book this change and possibly sell or take loans on their shares new value.

[AncientU]

Yeah, if you're trying to value a company you look at actual revenue, not promises of customers (bookings) or one-off deals that they have no hope of repeating. So far, SpaceX hasn't had any reliable revenue, and that's probably why they're off raising money again.

Why is the NASA/CRS deal one-off?  CRS-2 is coming as is CCtCAP. NASA science payloads are on the horizon. Other NASA launch/transportation services are possible down the road (BFR, depots, landers, etc.).
What is the distinction between these space transportation business opportunities and commercial launches that make them one-off and no hope of repeating?

[Ludus]

Are we sure this isn't just another employee stock sale?

That 's exactly what it is. Another liquidity round. They try to do this about twice a year for employees and minority investors (Musk controls a majority).

They have only done one liquidity round, or at least only one that Crunchbase knows about (the go-to source for tracking investments in the tech community).

As to $200M, that is too large for a liquidity round, so it is likely to be for capital projects such as the now-approved Texas launch site, reusability of the Falcon 9/H, and whatever the Raptor will be attached to.

Just as a general observation, investments usually are in the works for months since a lot of the time is taken in coming up with the valuation number.  It could have also been that they have been waiting for a trigger event, like the approval of the Texas launch site, in order to proceed since the valuation would be predicated on whatever the trigger event was and whether the proffered future still looks as rosy as management has suggested it would be.

Something else to watch on this is how much of it is follow-on investment from existing investors.  That's a pretty common occurrence in Silicon Valley today, and in fact the trend has been to "double-down" on existing investments instead of spreading their money across many investments.  For small, emerging companies that has created an investment crunch of sorts, but for SpaceX they are in the sweet spot (i.e. market validation, revenue and no near-term competitors).

http://pando.com/2013/03/20/dfj-led-a-30m-shareholder-liquidity-round-that-valued-space-x-between-4-5-billion/

Here's a reference to more. IIRC Musk or SpaceX has commented about the frequency. Some regularity was necessary once an IPO was off the table.

It is certainly possible that SpaceX itself is selling stock as part of it, which would take it beyond liquidity to raising capital. Since they are a private company it's hard to say. Whether the 50-200M range itself is too high for it is also hard to say. As someone commented, Musk could sell off stock in that range for personal purposes without substantially changing his control.

[QuantumG]

Why is the NASA/CRS deal one-off?  CRS-2 is coming as is CCtCAP. NASA science payloads are on the horizon.

A valuation is about growth. It's about the multiplier of investment to return. It's about saying "if you had X more money, what would you do to produce Y more return". It's really hard to make the argument that SpaceX could get more government business if only they had more production capability. Whereas commercial customers are lining up for it - if SpaceX can finally demonstrate they can deliver.

[Robotbeat]

Why is the NASA/CRS deal one-off?  CRS-2 is coming as is CCtCAP. NASA science payloads are on the horizon.

A valuation is about growth. It's about the multiplier of investment to return. It's about saying "if you had X more money, what would you do to produce Y more return". It's really hard to make the argument that SpaceX could get more government business if only they had more production capability. Whereas commercial customers are lining up for it - if SpaceX can finally demonstrate they can deliver.

Dont agree. They could take nearly all of ULA's business if Falcon Heavy was flying inexpensively and reliably and routinely from both coasts. That's a couple billion dollars of revenue, roughly. On top of ISS crew, cargo, and all the comm sat launches. And with high reusability it could be fairly high margin, potentially.

Plus Raptor and BFR really could compete for SLS money longer term.

[Scylla]

Updated: SpaceX denies report it is raising massive funding round, valued at $10B
http://gigaom.com/2014/08/19/spacex-reportedly-raising-massive-funding-round-valued-at-10b/

“SpaceX is not currently raising any funding nor has any external valuation of that magnitude or higher been done,” SpaceX communications director John Taylor wrote in an email to Gigaom. “The source in this report is mistaken.”

[WindyCity]

I wonder how he funds his billionaire lifestyle. It takes a few hundred million dollars to fund his personal lifestyle with the private jet, the $17 million mansion, etc. His official income from Tesla is something like $40,000 per year. He doesn't have any listed income as Chairman of SolarCity.

I would describe it more as a movie star's lifestyle, except that he works a lot harder, and the companies probably pay for a big chunk of the cost of the jet. I don't know how many billionaires work at two extraordinarily stressful jobs over seventy hours a week, buzzing back and forth between LA and San Francisco, and spend most of their "spare" time raising a household of boys. If that's living on easy street, many of us might prefer a modest pension and a cozy cabin on the shores of Walden Pond.

[deruch]

With nearly 20 launches on manifest between now and end of 2015, cash flow shouldn't be an issue from now on. That is assuming they can duplicate the last launch. There is also another possible revenue stream, every recovered booster is a $20-30m bonus. Assuming a 50% recovery rate that is $200-300m bonus.

Are they selling the recovered boosters for scrap metal?  Just recovering them doesn't earn SpaceX much of anything.  In fact, there will be increased costs (storage, disassembly, testing, analysis, changes to production methods, etc.).  It's not until they can launch on a reused booster that there's any possibility of cutting their costs.  Even with recovery guaranteed, easy non-refurbished reuse isn't a given.  There's certainly a potential for their future launch costs to come down some, though.  But I wouldn't look for those savings for quite a while yet.

[ncb1397]

ULA is worth 7.5 billion with a 15x multiplier on their 500 million annual profit. If someone is betting that SpaceX is going to be ULA but with commercial customers and minimal costs due to re-usability, I can see the 10 billion dollar valuation.

[Norm38]

So, has SpaceX found a successful "repeatable and scalable business model"?

When they re-fly a first stage they will. A lot of that $10 Billion must be counting on reuse panning out.

[meekGee]

Why is the NASA/CRS deal one-off?  CRS-2 is coming as is CCtCAP. NASA science payloads are on the horizon.

A valuation is about growth. It's about the multiplier of investment to return. It's about saying "if you had X more money, what would you do to produce Y more return". It's really hard to make the argument that SpaceX could get more government business if only they had more production capability. Whereas commercial customers are lining up for it - if SpaceX can finally demonstrate they can deliver.

So we seem to have a the following situation:

A number of rather successful investors think one thing, and QG thinks another.

There are three explanations:
A) QG is correct about the investors being irrational with their money by a good order of magnitude, or
B) The model for valuation used by the investors is more forward looking than QG's, or
C) The investors have been given some information by SpaceX that makes then subscribe to the $10B valuation.

Shall we start a poll?

[Scylla]

Unfortunately for the discussion on this thread, there appears to have been an oopsy on the reported fund raising and 10 billion valuation.

I refer you to my post up thread-#51.

[meekGee]

Unfortunately for the discussion on this thread, there appears to have been an oopsy on the reported fund raising and 10 billion valuation.

I refer you to my post up thread-#51.

Party spoiler!

And add option D to my list above:
D) This has all been a dream

[TrevorMonty]

Video from Smallsat conference 2014 of  Steve Jurvetson talk on SpaceX and its original financing. This presentation was where the video of 1 stage landing was first shown.