Rocket Lab closes lower in first day on Nasdaq
COLORADO SPRINGS — Shares in small launch vehicle and spacecraft developer Rocket Lab dropped in their first day of trading Aug. 25, but the company’s chief executive says it remains focused on its long-term plans enabled by going public.
Rocket Lab made its debut on the Nasdaq exchange Aug. 25 after completing its merger with Vector Acquisition Corp., a special-purpose acquisition company (SPAC). The stock, trading under the ticker symbol RKLB, closed down 9.85% at $10.45 per share.
The merger, approved by Vector shareholders Aug. 20, provided the company with $777 million in capital. Rocket Lab plans to use that funding to support new initiatives, such as its Neutron medium-class rocket that it unveiled at the same time as announcing the SPAC deal in March.
In an interview Aug. 25, Peter Beck, chief executive of Rocket Lab, said the company would provide an update on Neutron later this year. “We’ve been busy and have done a lot of work” on the design of the rocket, he said. “It’s coming to fruition in the next couple of months.”
Besides the capital raised by the SPAC merger, Beck said that going public improves the company’s ability to do acquisitions because of the “public currency” of its stock traded on the Nasdaq. “There’s a real opportunity to do consolidation in this space, and we intend to be one of the consolidators.”
Beck played down some of the disadvantages of going public, from the day-to-day volatility of the stock to quarterly financial reporting. “We were always intending to be a public company anyway,” he said, noting that the company had already built in the “checks and balances” required of publicly traded companies. “There’s not a whole lot in that respect that changes.”
He also didn’t think the company’s employees would be distracted by the ups and downs in the share price. “People at Rocket Lab are super-excited about the engineering and the mission,” he said. “At the end of the day, that’s what drives the passion and the motivation.”
Rocket Lab is part of a wave of companies in the space industry that have announced SPAC deals in the last year, allowing them to go public more quickly than the traditional initial public offering process. Some have criticized the SPAC process, though, for being less rigorous, reducing the quality of the deals.
Rocket Lab’s SPAC deal “has been a pretty good process,” he said, citing the certainty it provided about the capital raised and the company’s initial valuation. The mechanism of going public was less important than going public itself, he argued. “It will take a little bit of time, but we’ll see the market shake out.”
The company is focused in the near term on a series of upcoming Electron launches, including three consecutive launches for geospatial intelligence company BlackSky, arranged by Spaceflight, starting late this month. Electron will launch NASA’s CAPSTONE lunar cubesat mission as soon as late October, although Beck said the exact timing will depend on several factors, including the narrow launch windows needed to send the cubesat to the moon.
Beck said Rocket Lab will also perform later this year its next attempt to recover the first stage of the Electron as part of its effort to make the stage reusable. If that is successful, the company will attempt to catch the stage of a later launch in mid-air and then reuse that stage.
“In an industry and a market that is full of promises and aspirations, we’re super-happy to consistently deliver,” he said.
Rocket Lab had the honor of formally opening trading on the Nasdaq Aug. 25, which was after midnight Aug. 26 in New Zealand where Beck and many company employees are based. “This is a big moment for the team,” he said. “People are still up, celebrating hard.”