Shift4 Payments CEO and SpaceX customer Jared Isaacman on Saturday backed the Elon Musk-founded rocket manufacturer against allegations that it is undercutting competition to the point of operating at a loss to get launch contracts.
What Happened: “I don't think SpaceX bid at a loss. Reusability and operating at scale significantly reduce the incremental cost per launch,” Isaacman said. However, were the company to increase costs given its current share of the launch-providing industry, it would give rivals the opportunity to win contracts from it, similar to how SpaceX took over the market from United Launch Alliance many years ago, he said.
“The company is not operating at a loss and raising funds to keep operating,” Isaacman said. “It's kind of absurd to push the narrative that Elon puts on a ‘show’ or operates irrationally to raise funds when his companies are profitable, highly valued and he personally has more resources than anyone else in the world to invest in what he believes in.”
Isaacman is the founder of the Polaris program. Polaris Dawn, the first of up to three human spaceflight missions planned under the program, launched in September with an all-civilian crew composed of four, and two of them conducted the world’s first private spacewalk outside a SpaceX capsule. Isaacman did not reveal how much he paid for the mission but it is estimated to have run into hundreds of millions.
Allegations of SpaceX undercutting rivals to the point of loss emerged after the U.S. SpaceForce selected the company over rivals to launch multiple new national security missions for about $733.6 million on Friday.
Why It Matters: SpaceX, unlike Musk’s Tesla, is privately held, meaning it does not provide periodic disclosures of its finances and operations.
However, in May, company CEO Musk said that the company has no need for “additional capital.”
“SpaceX has no need for additional capital and will actually be buying back shares. We do liquidity rounds for employees and investors every ~6 months,” Musk then said, referring to the company’s periodic tender offers.
SpaceX was valued at $180 billion in a tender offer in December, according to reports from Bloomberg.
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Photo courtesy: SpaceX
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