Peter Beck has been having a pretty great June. Earlier this month, he was made a Knight Companion of the New Zealand Order of Merit. Then, Sir Peter Beck presided as Rocket Lab launched its 50th Electron rocket, becoming the fastest company to launch its 50th privately developed booster.
Finally, last week, Rocket Lab revealed that it had signed its largest launch contract ever: 10 flights for the Japanese Earth-observation company Synspective. Ars caught up with Beck while he was in Tokyo for the announcement. What follows is a lightly edited transcript of our conversation, which touches on a variety of launch-related issues.
Ars Technica: Hi Pete. We’ve talked about competition in small launch for years. But when I tally up the record of some of your US competitors—Firefly, Astra, Relativity Space, Virgin Orbit, and ABL—they’re 7-for-21 on launch attempts. And if you remove the now-retired rockets, it’s 1-for-6. Some of these competitors have, or did, exist for a decade. What does this say about the launch business?
Peter Beck: Well, I think you said it. It is a hard business. But there are a few things here. Firstly, I think we brought the right product to the market at the right time. You need two things to be successful in this game, right? You need a steady stream of customers, and you need to build something that can be produced, and then you produce it. Both those things have to go hand in hand. If you lay the first rocket that we ever built, Flight 1, against Flight 50, the rockets are largely the same. We didn’t put a minimum viable product on the pad and then have to go back and redesign it. That was important because we came out of the gate with Flight 2, Flight 3, and Flight 4 all in quick succession. We built something to be produced. It’s often said that production of rockets is just way harder than building the first one, and I think that’s accurate.
Ars: Why is that?
Beck: So when you’re first building your first five or 10 rockets, you know, they’re built by engineers with plenty of time to lovingly pore over every detail. By the time you get to rocket 50, it’s built by a skilled technician on the shop floor reading instructions. And you’ve got apprentices, you’ve got new people you’re training through, and, you know in order to build them reliably, you have to have all of the engineering or all of the company’s systems in place. It’s MRP systems [material requirements planning], ERP systems [enterprise resource planning], supply chain, finance. That’s what makes a production line work and roll.
Ars: Why do you think Rocket Lab has succeeded where your competitors have struggled to get to their first launch and then reach a high cadence?
Beck: I always liken building a rocket company to running through a maze at night. You just can’t make mistakes. And I’m not arrogant to say that we haven’t made mistakes, but you can’t make engineering mistakes. You can’t go down engineering dead ends. And if you look at the funding profile as well, we weren’t the pre-ordained winners in this. I remember running around Silicon Valley trying to raise $5 million at a time. Everybody would look at Virgin Orbit and say, “Well, how are you competing with Richard Branson?” For all intents and purposes, he had infinite capital. We have a saying here at Rocket Lab that we have no money, so we have to think. We’ve never been in a position to outspend our competitors. We just have to out-think them. We have to be lean and mean. If I had to boil it down to one succinct thing you could put in an article, I would say it’s being ruthlessly efficient and not making mistakes.
Is small launch a viable business?
Ars: It’s interesting you brought up Virgin Orbit. What is striking to me is that, technically, they did a great job. But they were really limited to just doing small launch because of their first stage carrier aircraft. So it was going to be difficult to diversify into a larger launch vehicle or space services, which is where I think a lot of the value of Rocket Lab is today. What I’m asking is this: Is small launch a viable business, or is it just a stepping stone to bigger things?
Beck: It’s very, very hard. And the reason why it’s so hard is that, like, you have a flight safety team. And the flight safety team for a little rocket needs to do exactly the same tasks as for a big rocket. Except all of these teams, whether it’s flight safety, supply chain, quality, all these things, you have to amortize that over a $7.5 million or $8 million sticker price. So you can’t afford to build a 50-person safety team. You have to build a five-person safety team. So in every way, we’ve had to be ruthlessly efficient, and you know, automate and come up with clever ways to solve all of these problems.
If you just focus on building the rocket, then you’re screwed. You have to focus on building the company equally as much as you focus on building the rocket. And this is where, if you look back, I think a lot of our competitors have failed. Not to pick on Virgin Orbit, but that thing was never going to be commercially viable. It’s fixed, roughly, from day one, what the sale price of the rocket is going to be. And it should be fixed what your margin is going to be. And, like, it was never going to add up. Which is sad, given the amount of effort and money and time and energy that people poured into it. But the business model was fundamentally flawed from day one.
Ars: What do the next 50 launches look like for Electron? How’s the manifest? It seems like we’re moving toward a medium-lift launch world.
Beck: I’m asked this question a lot, right? When you get Neutron to the pad, are you going to retire Electron and all that? But the answer is absolutely not. We sold over 22 launches this year, and next year is looking even better. There is a definite demand that small launch has, and a capability that small launch gives. We have just so many customers now that absolutely rely on Electron. They’ve designed their constellation or their spacecraft around Electron. It does things that you just can’t get on other missions. I think a lot of people compare Transporter (SpaceX’s rideshare missions on the Falcon 9 rocket) to Electron and dedicated launch, and there is no comparison. Transporter can do it for free for all we care, because the customer who is coming to Electron really needs instantaneous launch, the right inclination or orbital plane. If we just stopped doing Electron, there would be a whole lot of people with nowhere to go. There’s been a market built up around the product, and it continues to grow.
The future of Electron and Neutron
Ars: You’ve been flying Electron for about seven years now. How long do you expect to continue flying it?
Beck: I don’t see any retirement point in the future. We see new customers designed to the Electron standard all the time.
Ars: There really is no Western competitor now, or in the near future, in Electron’s class. Or is there something I am missing?
Beck: No. Sometimes being first really matters. One of the things when we were developing Electron is that I was very resolute that we have to be first. And the first mover advantage in what really was just a new category is super important. Most of our customers, you know, we still have new customers, but there’s a tremendous amount of returning customers. And if you look at it from their point of view, even if someone turns up with a rocket that is half the price, really the reliability of Electron and the precision of it, it’s hard for someone to move on to a new platform. Now, I don’t mean that to sound arrogant at all. It’s just that price is not the number one thing. It’s important, but it’s just not the number one thing anymore. I mean, we’re inserting to an accuracy of 400 meters at this point. So that’s almost good enough to rendezvous straight off the rocket.
Ars: Recently, the US Space Force announced the Lane 1 winners for launch contracts. Lane 1 looks a lot like Lane 2. Do you have any concerns about that?
Beck: No. I mean, it’s totally expected. You can’t have nobody in Lane 1. We advocated for, if you’re in Lane 2, to not be able to drop down to Lane 1. But also, realistically, the government has spacecraft that need to get launched. So that was very predictable.
Ars: It seems fair, with an annual chance to on-ramp new rockets?
Beck: Yeah. We were very happy to see that.
Ars: So, how is Neutron coming along? When I look at other companies, and when they test their main engine as you’re doing with Archimedes, it typically takes a couple of years to get from that point to a first launch. Is 2025 still possible for a debut, or is that pretty aspirational?
Beck: Look, we’re pushing hard. We always run pretty aggressive schedules. It’s just the way the company is. We tell everyone the date is 2025, but it is a rocket program, right? This isn’t our first time around the block, and there’s a tremendous amount of Electron stuff that flows into Neutron. And you know, we’re a team of nearly 2,000 people now across all the divisions. So when something needs to happen, we can really flex the labor force around to make something happen. The date is tight, of course. But it’s the way we roll. There’s nothing fundamental preventing us from achieving it.
Ars: How is the market looking for Neutron?
Beck: It’s pretty much a mixture of government and commercial, not dissimilar to Electron’s manifest. And then, of course, there’s a number of constellations that we have good relationships with, that we’re hoping at the right time we’ll be able to work with. We’ve always been very transparent that Neutron is about providing an alternative to the Falcon 9, but it’s also built to launch our own stuff.
Ars: Such as?
Beck: I would say that it’s very early days. I said to you before, with some things it’s best to have a first-mover advantage, and sometimes it’s better to be a second-mover advantage. From our perspective, we are very happy to engage and provide products and services and everything else to a number of constellations. But I think the jury’s still out on what are the really big opportunities for low-Earth orbit. Starlink looks great now, but nobody actually knows the business model; nobody’s ever seen the numbers. So you know, how good is that business really? If it turns out it’s a good business, then there has never been a monopoly that has survived.
Competing with SpaceX
Ars: Your recent comments in The New York Times got a lot of attention, Pete. What are you really trying to say about SpaceX? Are they a ruthless competitor, or are they going over the line and unfairly manipulating the launch market?
Beck: You’re trying to get me in trouble, Eric. I’ve got to be super careful about what I say is what I learned from that.
Ars: Clearly, they are the 800-pound gorilla in the launch industry now. And the Transporter missions, while serving the small satellite industry, have clearly been detrimental to small launch companies. But I genuinely would like to know what you would say about SpaceX as a competitor. Are they being unfair? What would you like to say about that besides “no comment”?
Beck: Well, “no comment” is the safe approach that doesn’t cause more problems. But look, there’s no accidental monopoly. They are a ruthless competitor. And that is fine. That is absolutely fine. We will ultimately compete or die trying. I think that’s just the reality of running a business. And I’ll let others determine whether or not they’re operating within a moral or legal framework that is correct.
Ars: What’s the best way to compete with them on launch?
Beck: Well, you certainly can’t outspend them. Elon has, essentially, infinite capital. So you just have to build a fundamentally great product that people want to use, ultimately, and a business people want to work with.
Ars: How do you view the Starship program? Do you think they’re going to be successful with rapidly reusing the Starship upper stage?
Beck: I think it’s very challenging. And every day it starts to look a little bit more like a Space Shuttle, and that is not by accident, right? I mean, there’s very hard engineering problems to solve. And, you start to whittle away to a smaller and smaller number of solutions to solve those problems. But yes, I think they’ll ultimately get there.
But once again, what market is it serving? Are you building a business alongside building the product? And don’t forget, Elon’s vision is to go to Mars and colonize Mars. And I haven’t seen the latest numbers, but I’ve seen numbers like 30,000 Starships or something like that to do that. If that’s your means, and that’s the business that you’re trying to build, or the dream you’re kind of trying to fulfill, then Starship is awesome. They’re doing really well, and it’s fantastic to watch. But there has to be a business in colonizing Mars, at the end of the day.