Relativity Space raises $140 million
WASHINGTON — Small launch vehicle company Relativity Space announced Oct. 1 it has raised a new round of $140 million, a sign of investor confidence despite strong competition and setbacks suffered by other vehicle developers.
The company said the Series C round was led by two new investors, Bond and Tribe Capital, along with existing inevstors Playground Global, Y Combinator, Social Capital and Mark Cuban. A number of individual investors also participated, including former Disney president Michael Ovitz and entertainer Jared Leto.
The new round brings the total raised by the Los Angeles-based company to $185 million. The new funding, Relativity executives said, will be sufficient to complete development of its Terran 1 rocket and begin commercial operations in 2021. It will support expansion of its headquarters and establishment of a factory for rocket production at the Stennis Space Center in Mississippi, where it currently tests its engines.
“That round will carry us past first flight of Terran 1,” said Jordan Noone, co-founder and chief technology officer of Relativity, in an interview. “This round is all the capital required to get to first flight, build out more of the Mississippi test site, Launch Complex 16 in Florida and expand our L.A. headquarters and manufacturing.”
That first launch, once scheduled for late 2020, is now planned for February 2021. “That original prediction for when first flight would be was made about four years ago, so moving it two months to the right here is not bad,” he said. Part of the reason for the slip is a decision to develop a larger payload fairing with twice the volume of the original one, based on feedback from prospective customers.
The two new investors, besides providing significant amounts of capital, will also provide expertise to help Relativity, now at 110 employees, grow. “Part of the reason why we liked Bond is that they’ve been amazing at growing and scaling companies,” Noone said. “We are approaching a size of company that, in some respects, is not considered a startup any more, so having resources that have helped build and scale companies before is something that we find highly advantageous.”
An official with Bond said that they were particularly interested in Relativity’s use of 3-D printing technology, called Stargate, for the rapid manufacturing of rockets without the need for a large workforce. “We believe the Stargate factory is a template for the future of aerospace manufacturing and provides Relativity’s commercial customers, and eventually humanity, a faster, more reliable and lower cost way to shuttle important resources from earth to outer space,” Noah Knauf, co-founder and general partner at Bond, said in a statement.
“Accelerating speed in the design, manufacture and delivery of rockets will become the Moore’s Law of space travel and exploration,” said Arjun Sethi, co-founder and general partner of Tribe Capital, in the same statement. “Just as doubling microprocessor speeds enabled the personal computing revolution, Relativity will push forward an entire ecosystem of hardware and software systems to take humanity beyond Earth’s orbit.”
Noone said work on the Terran 1 vehicle, designed to place up to 1,250 kilograms into low Earth orbit, is going well. He cited “significant progress” on the vehicle’s engines, being tested at Stennis. The company will provide more updates on the progress of the vehicle later this year.
Relativity has announced four customers to date, including major satellite operator Telesat, smallsat aggregator Spaceflight, and startups Momentus and mu Space. “There’s much more in work,” Noone said, promising to “double down” on customer announcements now that the funding round has closed.
The massive funding round is also a vote of confidence in the overall small launch vehicle industry. It comes amid widespread industry belief that there are far too many launch vehicles under development than can be supported by the market. It also comes a month and a half after Vector, another small launch vehicle company that raised about $100 million, laid off nearly all its staff after suffering what it termed a “significant change in financing.”
“This really puts us in a good spot in getting to first flight,” Noone said of the round. “The size of this round is pretty unheard of in the launch vehicle industry, other than SpaceX. We’re really taking that as strong validation of the belief in our investors of the team and the rocket.”