SpaceX founder Elon Musk (left) and Blue Origin founder Jeff Bezos.
AFP (via Getty Images)
Billionaires Elon Musk and Jeff Bezos are expected to be among selected officials watching in the Capitol Rotunda when Donald Trump is sworn in as the 47th president of the United States.
But when it comes to space rivalries, Bezos’ Blue Origin is not in the same room as Musk’s SpaceX.
Blue Origin launched its first rocket into space on Thursday, 25 years after Bezos founded the company with the wealth he earned from e-commerce giant Amazon. SpaceX, which Musk founded two years later, took just six years to reach space. Last year, it successfully launched 133 rockets, accounting for more than 85% of the payload mass placed into orbit worldwide by the third quarter.
This is the result of starkly contrasting approaches based in part on how companies finance themselves. Mr. Bezos, who until recently was funding Blue Origin solely from his own fortune, has taken a cautious pace in developing rocket technology. Musk adopted the classic Silicon Valley approach of “fail fast and learn” because initial funding was more limited and there was an ever-present risk of failure.
“At SpaceX, engineers work hard and then burn out. Blue Origin offers more stability,” said Caleb Quilty, an analyst at Quilty Space. “Over the years, it became clear that it was a little too stable.”
Chad Anderson, managing partner at investment firm Space Capital, estimates Bezos has invested $14.6 billion into Blue Origin. Musk reportedly invested $100 million into SpaceX to develop its first rocket, the Falcon 1, with the money coming from the $307 million sale of his first company, Zip2, which he co-founded, and the The third was the proceeds from the sale of PayPal for $1.5 billion.
But Musk also received a strong boost from Pentagon and NASA launch contracts, with the latter giving the company $278 million in 2006 to build a more powerful rocket, the Falcon 9, which became the company’s flagship rocket. Funded the development of “. And in 2008, NASA awarded SpaceX a $1.6 billion contract to transport cargo to the International Space Station as part of an effort to foster private space companies in the bet that they could provide the service at a lower cost. Ta. (Blue Origin has also won big contracts with NASA, but only in the last few years.)
The credibility of large government contracts helped attract private customers and outside investors. In total, SpaceX raised at least $9.5 billion. This leaves Musk with just 42% of the stake, but investors have estimated SpaceX’s value at an eye-watering $350 billion as of the latest private equity sale in December. His stock is worth $147 billion. (Forbes estimates that Bezos’ total net worth is $434 billion, making him the richest person in the world. Bezos is in second place with $239 billion.)
Mr. Musk and Mr. Bezos were motivated by the same goals. The idea was to reduce the cost of reaching space with reusable rockets and allow humans to travel to the stars.
But where SpaceX is famously fast-paced, Blue Origin takes a more methodical approach, as epitomized by its motto, gradatim ferrociter (Latin for “step by step, furiously”). developing technology.
SpaceX has accelerated its Falcon 9 launches from 18 in 2017 to 60 in 2022, but Blue Origin’s rival New Glenn rocket, originally scheduled to fly in 2020, continues to be delayed. Ta. In 2021, Blue Origin completed the first suborbital flight with its New Shepard rocket, launching a service that takes tourists to the edge of space. But the previous year, SpaceX had already accomplished something even more impressive: carrying astronauts far beyond NASA’s astronauts to the International Space Station. (Mr. Bezos can at least boast that he has surpassed Mr. Musk in one sense; he was on New Shepard’s first flight, even though Mr. Musk had not yet ridden a rocket.)
Blue Origin’s New Glenn rocket, seen here during a hot-fire test at Cape Canaveral, Florida, on Dec. 27, is 32 stories tall and taller than SpaceX’s Falcon 9. It is designed to carry twice as much payload, 45 tons, into orbit.
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After stepping down as Amazon’s CEO in 2021, Bezos began spending more time at Blue Origin and became increasingly frustrated with its slowness, former employees told Forbes.
“He tried to set a lot of indicators,” he said on condition of anonymity. “When it didn’t work out, I got frustrated and ended up firing the CEO.”
Under new CEO Dave Limp, who joined last year from Amazon, Blue Origin is preparing for New Glenn’s maiden flight and ramping up production of its powerful Be-4 engine, which is also used in United Launch Alliance’s Vulcan. I put a lot of effort into it. rocket.
It took a quarter of a century for Blue Origin to first venture into space, but the company had built the infrastructure for mass rocket launches, and once it reached orbit, SpaceX only assembled it gradually.
Blue Origin has developed a manufacturing facility that is expected to produce more than 100 Be-4 engines in 2025 and multiple boosters to support a launch pace of 12 aircraft per year.
The space industry is eager for Blue Origin to succeed and provide an alternative to the near-monopoly held by SpaceX in launching cargo into space. New Glenn’s payload capacity is about twice that of the Falcon 9, and Blue Origin sells launches at a significantly lower price per satellite, former employees told Forbes. It’s said to cost about $110 million compared to Falcon 9’s $70 million.
But SpaceX is hard at work testing its larger Starship rocket (the second stage exploded mid-flight late Thursday). The 400-foot-tall spacecraft will enable the Starlink satellite communications service to be augmented. Investors are more excited about Starlink’s prospects than SpaceX’s launch business, which is generally harder to turn a profit on.
“Mr. Musk realized very early on that the Internet business was more profitable than the rocket business,” Henry said.
Morgan Stanley analysts estimate that SpaceX generated $14.2 billion in revenue last year, 65% of which came from Starlink. They predict that Starlink alone will generate $48 billion in revenue in 2030, accounting for 83% of the $16 billion in net income.
Blue Origin’s business outlook is less clear. The company has a number of launch contracts with companies building satellite constellations that compete with Starlink, including Amazon’s Kuiper Network. The U.S. government wants to use Blue Origin to launch national security satellites and has received funding from NASA for the past three years. $3.4 billion to build a lunar lander and $172 million to develop a commercial space station.
Bezos’ ultimate goal is to use Blue Origin to create a space economy where manufacturing can move off-planet and restore Earth’s environment.
“As a businessman, I’m sure he has a vision of how to make it profitable,” Henry said. “But I don’t know what it is.”
Reporting from Phoebe Liu, Matt Durot and Alex Knapp.
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