Financing the New Space Industry by Howard E. McCurdy

Author:Howard E. McCurdy
Language: eng
Format: epub
ISBN: 9783030322922
Publisher: Springer International Publishing

Advancing the firm was more challenging. Development of his New Shepard launch vehicle was underway by 2005. Twelve years later (in 2016), the company concluded its signature achievement, repeatedly landing a previously flown New Shepard booster on its tail. As Blue Origin moved into production and testing of the New Shepard, the company’s financial requirements grew. So did its need for personnel. From 600 employees in 2016, the firm moved toward 2000 in 2019.13 A 2000-person aerospace firm operating in those years could easily consume $1 billion in annual expenses. Without significant contract or sales revenues, that would require massive infusions of cash.

Bezos seemed content to provide it. In 2010 and 2011, the company received two small NASA grants worth $26 million. The grants supported efforts at Blue Origin to use NASA technology to mitigate risks to the crew capsule at launch.14 Yet when the time came to apply for the richer crew transport awards, Bezos declined.15 Overall company operations continued to depend on Bezos as patron.

Fortunately, for Blue Origin, Bezos’ wealth continued to soar. By 2016, his net worth totaled $70 billion—the second wealthiest person in the world. In spite of the spaceship investments, his wealth increased rapidly. By 2019, Forbes listed him as the richest person on the planet, with a net worth among his immediate family of $131 billion.16 Unlike Elon Musk, who ran out of cash while investing in new technologies, Bezos did not need external infusions of capital to keep his vision going. He could use his own funds.

Not surprisingly, reports began to emerge that Bezos was selling Amazon stock to maintain his spacefaring dreams. In 2018, Bezos confirmed the reports. “I am liquidating about $1 billion a year of Amazon stock to fund Blue Origin. And I plan to continue to do that for a long time.”17

Bezos behaved like a philanthropist fascinated by something that appears both wonderful and new. The purpose of Blue Origin’s founding, according to various public statements, was to create an enduring human presence in space. Growing up, Bezos read science fiction, watched Star Trek reruns, and joined his high school science club. Much attention is paid to Bezos’ 1982 commencement address to his fellow students at Miami’s Palmetto High. In it, he envisioned millions of people living and working in a cosmos populated with large space colonies, space hotels and amusement parks. By dissipating population pressures on the home planet, he prophesized, the Earth could be turned into a giant natural reserve. The episode represented for the popular representation of Bezos what Robert Goddard’s “anniversary day” did for the earlier rocket pioneer. Goddard recalled as a young person climbing a backyard cherry tree and dreaming of a voyage to Mars, an event that he thereafter celebrated as the source of his motivation for rocket development. Bezos became an entrepreneur. “The reason he’s earning so much money,” his high school girlfriend explained of him, “is to get to outer space.”18

In another respect, Bezos behaved like an entrepreneur supported by profit-ready benefactors (which in this case consisted of himself).

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