WASHINGTON — Small launch vehicle developer ABL Space Systems announced March 25 it raised $170 million in funding to help it build up infrastructure and launch sites ahead of its first launch.
ABL said its Series B round was led by funds and accounts advised by T. Rowe Price Associates. Existing investors also participated, along with new investments by Fidelity Management & Research LLC and another “global investment management firm” the company did not name. The new round values ABL at $1.3 billion.
Dan Piemont, president and co-founder of ABL, told SpaceNews that the funding round will support future growth for the company, which had raised about $50 million before this round. “We can continue investing in the infrastructure we need to scale production and launch cadence, including setting up a few launch sites as fast as we can in the U.S. and U.K.,” he said.
ABL is developing the RS1, a small launch vehicle capable of placing up to 1,350 kilograms into low Earth orbit. The company is preparing for a first launch of that vehicle as soon as the second quarter. Piemont said that first vehicle should be ready for launch in the second quarter, but that schedule depends on the status of licensing.
That first launch, which will carry two satellites for L2 Aerospace, will take place from Vandenberg Air Force Base in California. In February, Lockheed Martin selected ABL to perform a “UK Pathfinder” launch from the Shetland Space Centre in 2022.
ABL is one of many companies actively developing or operating small launch vehicles, a supply that seems far in excess of even optimistic demand forecasts. However, Piemont said he sees room for the RS1 in that market, particularly in the near term. “People say it’s a crowded market, but we see a lot of unserved demand in the 2022-2025 timeframe and need to scale quickly to address it,” he said.
The lead investor, T. Rowe Price, considers ABL an attractive investment amid a growing space industry. “We think ABL has a management team, technology set and product strategy that should enable long-term competitive advantages,” Jason Adams, portfolio manager of T. Rowe Price’s Global Industrials Fund, said in a statement.
Adams “is really smart on space, aerospace and defense, and industrial growth, and T. Rowe is one of the world’s best investors,” Piemont said. “They are obviously focused on public markets and fairly selective with private investments, so we jumped at the opportunity to bring them on board.”
ABL’s private funding round stands in contrast to a new wave of companies raising money by merging with special-purpose acquisition corporations (SPACs), an alternative to traditional initial public offerings. In the last two months, two small launch vehicle companies, Astra and Rocket Lab, have announced SPAC deals, allowing each to raise hundreds of millions of dollars and become publicly traded companies once the mergers close.
Piemont argued that the funding round ABL raised is preferable to a SPAC, avoiding the scrutiny that public companies face. “We think that a private round with this type of investor syndicate is a great alternative to a SPAC at this stage, with most of the benefits but less risk of distraction from focusing on our customers’ immediate needs,” he said.
