[[Home|🏠]] <span style="color: LightSlateGray">></span> [[Interviews]] <span style="color: LightSlateGray">></span> November 19 2024 **Insider**: [[Peter Beck]] **Source**: [Payload](https://www.youtube.com/watch?v=FdrKAc2AYZc) **Date**: November 19 2024  🔗 Backup Link: https://www.youtube.com/watch?v=FdrKAc2AYZc ## 🎙️ Transcript >[!hint] Transcript may contain errors or inaccuracies. **Mo Islam:** Hey everyone and welcome to another episode of Pathfinder by payload, leading digital media company in the space industry. I'm your host Mo Islam, and today we're joined by a very special guest, Peter Beck, the founder, CEO and CTO of Rocket Lab, a global leader in launch and Space Systems. Peter is joining us from a Rocket Lab test site in New Zealand, so we're hosting the interview on the field. Peter and I talk of the election, Neutron development, the future of Electron, human spaceflight, and much, much more—a very special one for you guys, so let's jump in. ### Where is Peter Beck? **Mo Islam:** Peter, very excited to finally have you on Pathfinder. **Peter Beck:** Yeah, great to be here, Mo. **Mo Islam:** Tell us a little bit about where you are because this is the first episode that we're doing where our guest isn't sitting in an office. **Peter Beck:** Well, I mean, today's a big testing day here. I'm at one of our test complexes down in New Zealand. We've got a whole stage two Neutron tank here undergoing some flight-like testing. So my apologies for having to do this on the run, but the rocket always comes first, as you know. **Mo Islam:** No, this is great. We've never done an episode live from a test site, so very exciting. ### Space and the Coming Administration **Mo Islam:** We have a lot to get to, and we're certainly going to talk about Neutron today, but I can't not start with a question about the US election. It just happened, it's very top of mind for Americans. We're going through this transition of administrations in just a few months. What do you think this means for the space industry? I'm sure you've been thinking about this. What do you think this looks like for the space industry over the next four years? **Peter Beck:** I think it's actually pretty good news for the space industry. This Administration feels and seems very pro-space, pro-defense, and pro-space. So I think for the space industry, this is going to be a good time. ### Rocket Lab in the Market and Where They're Going **Mo Islam:** Amazing. After the news came out of who won, the market reacted pretty positively. The Market's been rallying over the last couple days. Speaking to a number of colleagues and folks on Wall Street, the feedback I've received is that they are receiving the highest levels of interest in Rocket Lab since a lot of these equity research teams started covering the company. Your market cap as of close today is right around seven billion. What do you think is happening from your perspective? What is the market picking up on in terms of the company, the story, where you guys are headed? **Peter Beck:** Well, I think it's kind of an interesting time in the space industry. If you think about the space industry in general, there's been a lot of space companies that went public, and they haven't really executed. The markets are pretty efficient, so they're very good at determining who are the performers and who are the non-performers. We've just kind of had our head down and just solidly kept executing. When we meet with investors, that's the kind of narrative—we said what we were going to do, and we've just sort of gone about systematically doing it. The market rewards people for doing what they say they're going to do. ### Neutron's First Launch **Mo Islam:** When do you expect Neutron to have its first launch? **Peter Beck:** So we're aiming to have a vehicle on the pad middle of next year. I think as everybody knows, always caveat that with "it's a rocket program," so there's always things that can take you by surprise. But actually, things are looking pretty good. There's lots of major tests occurring—one of which is today. We're feeling pretty good, but you're always one bad test away from a delay. At this point, I think we're pretty happy. ### What's Next After Neutron? **Mo Islam:** Assuming that the first test is successful, what's next immediately after? Are you planning to test all kind of systems associated with Neutron, including reusability, on the first launch? **Peter Beck:** Yeah, we are, but we won't be trying to land down on a barge. We'll splash it down in the ocean—we'll try and do a soft landing in the ocean. But the intent is that on the first flight, we want to learn and test as much as we can. Then as the program matures—this isn't our first rodeo, so we're pretty realistic about cadence. If we can get one away next year, then the following year we'll get sort of three or more away, and then five plus away the following year, and then scale it like that. I think if somebody stands up and says, "We're going to launch one rocket and then do 10 the next year," it's just craziness. They don't know what they're doing. ### What Will Be the Most Dominant Aspect of Rocket Lab in the Future? **Mo Islam:** We're gonna come back to Neutron in just a second. You've spent a lot of your time talking about launch, but of course your spacecraft business has become a significant part of your revenue and your strategy. Over the next five to ten years, what do you see becoming more dominant for you as a business? Which part? **Peter Beck:** The plan was always to move into spacecraft, and I think the bigger plan is to be the full end-to-end space company where we actually provide services as well. I think all big space companies of the future are going to look exactly like that. At the moment, the Space Systems part of the business represents about two-thirds of our revenue. From a market standpoint, that's quite nice because launch is just super lumpy. We only get to recognize the revenue at the time of launch, so if the customer is one day past a quarter late, then that revenue slips out. But where we are right now is a really nice place. If the launch slips, it's no big deal because there's plenty of heft in the Space Systems business to smooth all that over. But it's really part two of a three-part story—the space systems business. ### Hypersonics **Mo Islam:** Obviously you started things off with Electron, the success speaks for itself. You're now the world's third most frequently launched rocket annually, the second in the US. Everyone knows Electron these days, but I do want to talk a little bit about some of the work you're doing in hypersonics—the suborbital hypersonic opportunity. You're calling it internally HASTE. Is this a key growth area for you? **Peter Beck:** HASTE is a really important solution that we can provide to the USG. Hypersonics in general has been sorely lacking within the US, and the test flight availability has been really low. Being able to bring a vehicle that you just have full freedom of trajectory and mission profile is a game changer. It's super important to the Electron product line. We intend to see a lot of growth in that area. In typical Rocket Lab fashion, we announced it, then flew one. This is not some kind of long gestation period project. There's quite a backlog there of those HASTE missions now, and everybody's really excited because now there's a new capability within the nation to do things that have never been done before, and also at a cadence and a price that's just like Christmas. ### Electron Demand vs. Supply **Mo Islam:** Has Electron so far—you're launching very regularly at this point—been more demand or supply constrained? **Peter Beck:** Generally, we're always waiting on our customers. The market has continued to grow. This year we had our biggest demand with 22 flights, but what really constrains the cadence of Electron is their customers and their ability to deliver on time. The service that we offer is a dedicated service for our customers when they need to the orbit they need. So if they need to delay a month, a quarter, 6 months, then that's just part of the deal—that's the service that we offer. But it does make it difficult to predict cadence. From a factory and an infrastructure standpoint, we're not constrained there. It's really when customers are available to fly. ### Electron After Neutron **Mo Islam:** On Electron, once Neutron is operational, do you expect to need Electron anymore? **Peter Beck:** A lot of people ask this question. Look, Electron does something that no other rocket can do, and it's filling a really important market niche. Just as Neutron doesn't make that go away, no other medium class launch vehicle does either. If rideshare was the be-all and end-all, then there would be no demand for Electron, but that's just simply not the case. There's a really important need that Electron fills. **Mo Islam:** And to be fair, you did just launch a very special mission which was for an unnamed customer. We can probably guess who that might be, but from 10 weeks between contract signing and launch—I assume that's probably a signal of a lot more to come, catering to responsive space? **Peter Beck:** Absolutely. That timeframe was driven by external circumstances, licensing and things like that. It just goes to show that if a customer turns up, literally we can pull a rocket out, put it on the pad, integrate, and launch in a crazy short period of time. >[!hint] Tour of Testing Facility Begins Here **Peter Beck:** This is one of the engine test facilities that we operate here. This is just a cryo farm for one of the Rutherford engine test facilities. Generally, this facility is running two to three engines a day, and these are just in a pure production sense. We just basically pump the engines through here. The team does a trim run, then an acceptance run. This place just pumps out engines day in and day out. **Mo Islam:** Are you primarily testing Rutherford here or Archimedes as well? **Peter Beck:** Just Rutherford here. Archimedes is exclusively in a different site. This is just the Rutherford site, and we've got duty cells here. The team has closed it down today because we've got—you might be able to see it in the distance—a full stage Neutron tank out there that we're doing a major cryo test on today. So the team has halted this facility for the day, which is an unusual thing in its own right. ### Neutron's Development Timeline **Mo Islam:** Where is Neutron now in terms of development timeline? **Peter Beck:** You can think about Neutron divided into kind of like three pillars: 1. Infrastructure, which includes factories, test facilities, launch pads, and integration facilities. I think a lot of people would be surprised to recognize that's probably about two-thirds of the total investment of the rocket program—that steel and concrete in the ground. I joke with the team sometimes that we raise money and spend money to pour concrete, and that's the reality. 2. Propulsion, obviously. The Archimedes program is running super well, so I'm very happy with that. We took a bit of a different approach with Archimedes. Typically, you might start off with boilerplate chambers and pump elements and valve elements, and you slowly integrate an engine together with industrial items. We didn't do that—we built a production line. The first engine came off a production line and had flight software using flight avionics. Every bit of that engine was as we intended to fly. A little bit risky if we had a major issue, but we've built a few hundred engines now, so we kind of know what we're doing. 3. Tanks and structures. **Mo Islam:** The original design was gas generator, if I'm not mistaken? **Peter Beck:** We may have originally talked about that, but we've been ox-rich staged combustion for quite some time. The rationale for that is usually you go with stage combustion because you're looking for every second of ISP. But for us, you make the trade—you either have super light tanks and a low-performance engine, or heavy structures and tanks and a super high-performance engine. For us, we took the highest performing cycle and dialed it right back. Our operating position for a stage combustion engine is super benign, like way down the bottom end of margins. ### How Does Neutron Compare to Falcon 9? **Mo Islam:** In terms of general design decisions around Neutron, how do you see Neutron compared to Falcon 9? I know that most Falcon 9 customers don't really use up the entire payload capacity. Did that inform your design or play a role in informing the design and mass capacity of Neutron? **Peter Beck:** Absolutely. I'd say that we've done a pretty reasonable job of picking the market and what mass classes are useful. With Electron, the 200-300 kg in that vehicle is super obvious as the right place to be. And I think with Neutron, that sort of 13-ton regime is a really nice place to be—slightly less than a Falcon 9, not appreciably, but what we think the market is really driving us to. We've had the luxury of working with a lot of customers over a long period of time to really inform that decision. ### Neutron Launch Cadence **Mo Islam:** If the maiden launch is successful, what do you think launch cadence looks like for the next couple of years? **Peter Beck:** I think as I mentioned before, it's get the first test flight done. There'll be a ton of learnings, as there always is. Then the following year, probably about three flights, maybe a little bit more. Following year, something like five flights or maybe a little bit more. We'll just follow the playbook that we followed for Electron and just use it. It's a well-trodden path with respect to block upgrades. We'll also be introducing new things with reusability. You're not going to hear any kind of unrealistic projections from us on that. **Mo Islam:** And you're still targeting $55 million ASP? **Peter Beck:** Yep, yep. We think that represents great value for our customers. ### What Leads to Capital Efficiency? **Mo Islam:** I do want to talk a little bit about the development costs. It sounds like based on what I've seen publicly that the development will still cost around $350 million. When you look across the landscape of launcher development costs, you have certain folks like ULA where they're in the five to seven billion dollar category at the high end. How do you ultimately achieve that type of capital efficiency? What is the sort of internal culture, the decision-making that leads to such a cost structure? **Peter Beck:** It's a good question, and there's not one simple answer. To your point, Electron versus probably the nearest competitor to Electron was Virgin Orbit's vehicle—Richard spent $1.1 billion more than we did getting our first rocket to the pad. So it's not like we haven't done this before. There is a certain magic here, and I'd say it's across a bunch of things: 1. A rocket program is about making the right engineering decisions, because where you blow a whole bunch of capital is going down dead ends and technology paths you have to reverse out of. Running a rocket company is like running through a maze in the middle of the night, and at every dead end, there's somebody with a shotgun. So you have to run quickly, but you also have to poke your head around the corner and don't put yourself in a position where you're going to die. 2. From a business perspective, it's building the product that people want rather than the product that you think is cool to build. The space industry is full of visionaries, which is awesome, but that's not enough—you have to be a visionary with a product that people actually want to buy. 3. Then there's the Rocket Lab team. We're doing a big test here, and half the team just turned up and camped, just worked into the middle of the night, spent the night, woke up this morning, and we're into it. This is not an 8-to-5 kind of environment. This is a team that is super passionate and super dedicated, and it takes that level of commitment to do these amazing things. Some companies worry about millions of dollars—we worry about cents. Everything is accounted for and really well controlled. ### How Rocket Lab Created Successful Projects **Mo Islam:** I have sort of this debate with investors quite frequently. It's a very simple question: we've been going to space since the 50s and 60s pretty regularly. Yet fast forward to today, and you have all these bright teams with seemingly great infrastructure, great strategies, just generally everything sort of on paper checks the box, and they're handed 500 million to billion dollars, and they still can't get it to work. Why is that the case? You've alluded to why you've been able to make it work, but if you ask any launch company CEO, they would probably say similar things. Is there a factor here that's not being discussed or that you think is missing in some of these other companies that have burned through so much capital? **Peter Beck:** Well, if you just look at the data, you have Rocket Lab and SpaceX, and if you look at what is consistent there is that both CEOs of those companies are the chief engineers of the companies. Both CEOs are like me—I'm down at the engine, I'm at the tank test site, and we're doing real work. The close coupling of the engineering decisions with the business decisions, I think, is super, super critical. The great thing about the space industry is that physics doesn't care about money. You can have as much money and tip as much money as you want in, but at the end of the day, you still have to make the right decision. Engineering execution is the ultimate leveler. ### Aesthetics vs. Engineering **Mo Islam:** There's an interview with Elon where he talks about during the Starship development process, how he asked the team to make Starship pointier. The decision was going to have no positive impact on the performance of the vehicle and was slightly worse than the original blunter design. I'm curious, when you build Neutron... **Peter Beck:** This is so funny! I was literally out at one of our other factories the day before yesterday, and we were working on the nose cone. The original engineering nose cone for Neutron was very bulbous, and I complained bitterly that it just looked bad. It looked fake, it just did not look good. But of course, it was structurally the optimum shape because you have a trade-off between the aerodynamics and the mass of the structure, and you end up with this optimized shape. It just looked terrible. So we did exactly the same thing, ironically. We changed the ogive to look much better. Yes, it's slightly heavier, it's slightly better aerodynamically, but it's slightly heavier. Sometimes those things matter. ### SDA Contract and De-risking **Mo Islam:** Let's talk about the spacecraft business. You've recently won a very large SDA contract. From your perspective, has that de-risked the business, at least for the next couple of years? **Peter Beck:** Look, that's certainly a large contract, for sure. But there's just so much going on within the business, within the business units themselves. They're doing really well and scaling really well. Electron is scaling well. All parts of the business are doing well. You can't rest on your laurels and have one big contract and think life's sweet. It's an important contract, and it certainly gives some heft to the business and some scale, and that's great. But we still have our foot to the floor—there's much bigger things that we have aspirations to go after. ### Why Build Both Spacecraft and Launch Vehicles? **Mo Islam:** The spacecraft business was built foundationally on a great M&A strategy. Some might argue that building spacecraft is much easier than launch vehicles, so why acquire? **Peter Beck:** I think a lot of people think that we kind of pivoted into the Space Systems area, but honestly, the very second Electron that we launched had recesses in the kickstage for solar panels to turn that into a satellite. It's just I like to finish one thing before I start the next, and timing is everything in that respect. Once we committed that it's time to move on to start building spacecraft, the first thing we did is we laid out a spacecraft on the boardroom table and pointed to all of the things that really sucked. Then we strategically looked at whether we're better to develop those in-house or if we can acquire some of those technologies. Let's take solar as an example. Solar is building compound semiconductors—there's three companies in the world that can do that. So you're a little bit naive to think that you're just going to go out and recreate that. We looked for the best opportunity and the best technology, and hence the reasons why we went after [Cerato] and were able to pick up that business. From an M&A strategy, it's very much driven by a pain level—how painful is this—and some is driven purely by strategy. But one thing across all of the acquisitions is we don't just acquire things for their balance sheet. Yes, they need to be profitable, yes they need to have great teams that align with our culture, and they need to have technologies that we really value and need. These aren't just purely financial decisions—these are things that really enable us to scale into bigger opportunities in the future. ### Why Own and Operate Your Own Constellation? **Mo Islam:** It's been mentioned a few different ways, and if you actually look at a lot of the models that the investment banks are putting out around Rocket Lab, they have two main revenue line items: launch and spacecraft. But we've been hearing a lot of rumblings about Rocket Lab's desire to build its own constellation. That's not something that might be baked into a lot of these models or projections of where the business is going. To the extent that you can talk about it, what is the high-level plan around operating, owning, operating your own constellation? **Peter Beck:** Look, this is not a secret by any stretch of the imagination. This is the plan. What we're really trying to do here is build an end-to-end space company. If you fast forward 5 to 10 years from now, what are the large space companies and what do they look like? They're all going to be a little bit blurry between a services company and a space company. I think you don't need to look any further than Starlink, for example. If you want to provide internet from space, what do you need? You need unimpeded access to space at a cost point, so you need a reusable rocket. You need the ability to build satellites at scale, so you need all the components and subsystems to be able to do that. And then the third thing is the end application. As a company, the reason why Neutron's so important to us is: one, we're looking to disrupt the launch monopoly in medium class launch; sure, there's a great business opportunity and thing for us to go after there. But more importantly, our intention is to launch our own stuff. I think the large space companies of the future are going to look exactly like that. They're going to have applications, they're going to have the ability to build whatever satellite they need at scale, and they're going to have unimpeded access to space. **Mo Islam:** Does this look like an acquired business or developed and built in-house? **Peter Beck:** Way, way too early to say. Way early. Until Neutron's flying, it's all irrelevant. ### DoD's Proliferated LEO Satellite Services Program **Mo Islam:** What do you think of the DoD's plan—$13 billion, proliferated low Earth orbit satellite services program? How do you think about that within the context of everything you're building? **Peter Beck:** The DoD has been saying forever that they need to disaggregate some of these big juicy targets. The SDA is doing a wonderful job in creating robustness in the space supply chain. The DoD has been very clear that the plan here is to disaggregate into low Earth orbit. This is just as expected. ### Frank Klein Joining Rocket Lab **Mo Islam:** You did just recently have a pretty interesting hire that I wanted to talk about. You hired your new COO, Frank Klein. He has a pretty deep automotive background, which is reminiscent of your competitor in terms of some of their early operational hires. Tell us a little bit about Frank and what you think he's going to bring to the table. **Peter Beck:** This is the first time we've had a COO within the business, so it's a really important hire. I think we've done well at scaling, and we've shown that we can scale Electron into a regular cadence, and a number of the components. But we're looking to put the hammer down here and go to a much bigger level. Having someone with that level of experience is just super important from an operations perspective, as well as a background in production. ### Operations and Scaling Philosophy **Mo Islam:** Even before Frank, you guys have had a pretty robust plan around operations and scaling. What is your philosophy around operations? I use the example of Sinclair, one of the companies that you've acquired that produces reaction wheels. At the time of acquisition, it was something like 100-150 reaction wheels per year that Sinclair was producing, and now it's 2,000. What were the decisions that you've made that led to that type of scale? **Peter Beck:** I think if you look at the space industry in general, it's small organizations producing exquisite hardware, but all at subscale. We've seen it ourselves—you go to somebody and say you want to buy 100 of something, and they just freak out. Bringing scale to the space industry is something that's really sorely lacked. The one thing that Rocket Lab is really good at is very difficult things to produce and deep tech components and systems. We're just good at making them, and we have a production system that works really well. From a Sinclair standpoint, it was just an obvious scaling factor. You look across all of the business units, whether it be separation systems, software, or solar—they all follow the same path. The black wall goes up, the cubicles come down, the snack machines go in, and it's time to go. ### Outlook of the Supply and Demand for Launch Market **Mo Islam:** I want to pivot for a second to talk a little bit about the market, specifically around launch and some of your competition with Falcon 9, now Starship, New Glenn, Vulcan, Ariane 6—a number of large launch vehicles coming online, obviously including Neutron. What do you think the launch market's going to look like in terms of supply and demand? Do you foresee it being supply-constrained, demand-constrained? **Peter Beck:** The reality is, let's just take Amazon Kuiper. They procured all of the available launch in the world from Ariane 6 to Vulcan to Blue Origin—all of the launch available for an initial deployment of one constellation. Not an ongoing deployment, not a replenishment, and that's one constellation and one customer. If you look across the industry, both government and commercial, even if you apply some fairly hefty haircuts to who's going to be there and who's not, it's very obvious that launch is going to be very constrained. That kind of led into our go-to-market strategy with Neutron. With Electron, I had to sell them at super discounted rates because I was trying to raise capital out of Silicon Valley. This time around, we just don't need to do that. Nobody wants to buy a rocket that hasn't flown for full price, but our go-to-market strategy is just a little bit different because we have the capital, and we don't need to do those kinds of things. I think whoever turns up with a working rocket in a really constrained market is going to be everybody's best friend. ### Is There Still Room for New Launch Startups? **Mo Islam:** Do you think there's any room for new launch startups, or do you feel that window is closed? **Peter Beck:** To be honest with you, it feels closed. On the small launch side, certainly it feels very closed. On the medium scale, I think it's difficult as well. Not necessarily because there might not be demand there, it's just I don't know how you go from not building a small rocket and learning all those lessons and being an organization and improving an organization, then moving to a medium class vehicle. That is a proven path and road. Just going from "Hey, we're a new rocket company" to "Let's build a medium class launch vehicle"—as I was talking about before, one mistake and you've hosed away half your capital. On a small launch vehicle, one mistake and you're talking about hundreds of thousands of dollars rather than tens or hundreds of millions. You just have a level of cushion there to learn that you don't have. This is my personal view—I think if you're going to build a medium class launch vehicle straight out of the chute, unless you've got billions of dollars to do it, that's going to be really difficult. I just don't see the markets ponying up billions of dollars for somebody to go and do that. There's a good reason why you see the two wealthiest people on the planet having the two largest rocket companies. ### Future of Launch Outside the US **Mo Islam:** What do you think the future of launch looks like for countries outside of the US? Obviously, there's a lot of great American launch companies, but there's a lot of other countries out there that will have their own military and nationalistic ambitions that don't necessarily want to rely on SpaceX and Rocket Lab and Blue Origin. **Peter Beck:** They'll build their own national capability for sure, and we see that. Japan has the H-II, and Europe has Ariane 6. The challenge for a lot of these nations is that they have to be prepared to feed those launches and feed those companies with their own sovereign payloads. We often get asked, "Will you come to our country and set up a launch site for Electron?" We used to get, and still get, that quite a lot because a country wants a sovereign launch capability. It's a prestigious thing to have, but also if you want to enter the space industry, that's a natural entry point. The discussion always goes: "Sure, show us the sovereign payloads that you need launched." That's generally where things stop, because our customers don't care if they launch out of New Zealand, they don't care if they launch out of the US—they're looking for the best service. The launch site is relatively agnostic. In fact, a bunch of our customers really love coming down to New Zealand rather than to our Wallops launch site because they get to go jet boating and bungee jumping. I really think that unless you're a sovereign nation and you're prepared to feed your sovereign launcher with sovereign payloads, any commercial will just go where they get the best deal. ### Timeline on Human Spaceflight at Rocket Lab **Mo Islam:** As far as Neutron is concerned, I know that human rating Neutron is definitely on the roadmap. Do you have any sort of internal or mental targets of when you think Neutron or Rocket Lab will be going into human spaceflight? **Peter Beck:** Look, we're infinitely commercial. Human spaceflight is obviously awesome and aspirational, but right now it's well served by at least one provider, and there's one destination. If you sit back in the cold hard light of day and try and build an economic model around it, you can't. If there were multiple destinations and multiple customers requiring access—I mean multiple long-term customers—then we're all in. Show me the business case, and we're all in. I think that will happen over time, especially as space stations become commercialized and there's more destinations. Hence the reasons why we've made sure that Neutron is human-ratable, because I think that will be a market. But as of right now, there's one customer and one destination, and it's well served. **Mo Islam:** Is there a Proton on the roadmap after Neutron? **Peter Beck:** Look, I do not want to have to engage in another hat-eating exercise, so I've learned to say never say never. But certainly right now, all focus is on Neutron, for sure. ### Most Strategic or Technical Risk That Rocket Lab Currently Faces **Mo Islam:** What do you think right now, as it stands, is the most significant technical or strategic risk that the company faces? **Peter Beck:** There's no one giant red glowing thing. I think the reality with a space company is you have to be on top of it 100% of the time, and we do very difficult things that have no margin for error. That's just the reality. On the flip side, the company's well capitalized, the company's continued to execute, and programs remain on track. Really difficult programs like the ESCAPADE Mission to Mars—we delivered that on time, on budget. Not one, but two spacecraft to Mars. Just building a spacecraft to get to Mars is really hard, doing it within a commercial set of boundaries and margins is way harder, but delivering it on time—these are all things that the team has demonstrated they can do. I don't mean to turn your question upside down, but I think there's just a low level of background noise with a space company that you just have to be on it 100% of the time. ### Rocket Lab and the Moon **Mo Islam:** What do you think about the lunar opportunity? There's a number of companies obviously going after it. There's a publicly traded company that's building lunar vehicles and spacecraft, and obviously Artemis is right around the corner. How do you think about Rocket Lab's involvement with the moon? **Peter Beck:** Look, we've had involvement in a number of ways already. Obviously we did the Capstone Mission, so we love the moon. We've had a lot of our components on various programs to the moon, and the Blue Ghost vehicle has a number of Rocket Lab involvement in that as well. I guess it's a little bit like human spaceflight though. What is the magnitude of that market, and who's buying? I think where Luna will get very interesting is if there's a Chinese footprint going to the moon. I think at that point, it'll be all on, and the moon will have a different set of strategic needs and motivations. I'm not saying there's no market for Luna, but it's probably not as clear a path as some of the other things that we're pursuing. **Mo Islam:** I've asked this question very directly to a number of folks who are building products or spacecraft for the moon—what is the market, what is the economic ROI on the moon outside of NASA writing a check? The business case becomes challenged, for the time being. Obviously, there's a lot of assumptions that you can make of what the economy is going to look like in a few years, but you have to make a few leaps to kind of get there. ### Things to Embrace in Order to Build a Successful Company **Mo Islam:** I know you're standing in one place. I have a few more questions, but I'm just curious if there's anything else you'd like to show us? **Peter Beck:** To be honest with you, I shouldn't show you too much more. The team's giving me hand-waving signals, so I've been told to stand put. **Mo Islam:** Fair enough. I do have a few more just kind of personal questions for you. You've built a very successful business in the industry, in arguably one of the most challenging technological areas. What sort of lesson or principle from your experience do you think space industry leaders should embrace, or folks that are starting companies now should think about and embrace? **Peter Beck:** If you're starting a company, don't fall in love with technology. Be harsh. Look for the business opportunity and create technology to fill that gap. The great thing about the space industry is it's full of visionaries, but you have to be a visionary who executes as well to survive and to thrive. That would be my advice for anybody looking to start a space company—really look for the market opportunities that are solid and real and now, and then build technologies to go after them. Don't fall in love with your particular gadget or technology and then try and force it into a market. ### What Keeps Peter Up at Night? **Mo Islam:** What keeps you up at night, if anything? **Peter Beck:** Everything. I'm the worst—sleep is not something I do well. At the end of the day, I'm incredibly passionate about this company and incredibly passionate about what we do, so I've never understood how anybody can go home at night and turn that off. That's just not a reality for me. Everything [keeps me up]. I think if that wasn't the case, that would be time for me to go, because I think in order to be successful, you just have to have a level of commitment and passion. Otherwise, you shouldn't be in the game. ### When Will the Space Industry Be Welcomed by the Public Markets? **Mo Islam:** You've been a public company CEO for a few years. How has that been, looking back on it? I'm sure there's no regrets, but is there anything that you would have done differently approaching the public markets? That's question one. Question two: I'm curious—this is something that we get a lot from institutional investors—when do we think that space is going to be an industry that's going to be welcomed by or appreciated by the public markets? Because for the most part, it's not right now. There's a lot of companies that face far greater challenges of even staying listed on an exchange or will potentially be acquired. Maybe talk a little about what you think the future of space is within public markets as well. **Peter Beck:** That's a big question. Firstly, from a Rocket Lab perspective, our intention was always to go public. We saw an opportunity for a pure-play, end-to-end space company in the public markets. Yes, it's a new thing, but I think space is kind of in some respects a little bit like AI. If you think about the two biggest things in the world that are happening right now, it's really space and AI. So having a publicly traded company in this space that's pure end-to-end in a new space, I think was important—important to have a company there that was going to do well. To your point, Adam, my CFO, keeps reminding me we have "the best house on the worst street." But eventually the street gets gentrified, and the markets are very efficient, as everybody's seeing, at determining who are real and who are the winners and who are the losers. So that's all good. From a personal perspective, I wanted to take this company public for a slightly different reason, in the fact that the last thing I wanted to do was build a whole company around Peter Beck. Ultimately, when I depart this planet, you're measured on how much impact you have, and the way to have a lot of impact is to have endurance. The one thing that a public company really forces you to do is have a very sharp eye to profitability, a very sharp eye to sustainability, and all of those things are sometimes a bit painful, but they're good forcing functions. It would be a massive failure if I left this company one day and it stopped. I think if you look at some of the other new space companies out there, it's not as clear if those personalities depart whether those things continue. I really want Rocket Lab to be a multigenerational space company that is enduring, and taking it public is one way to force all the right behaviors to make that happen. I think there's a great opportunity for the public to share in a new technology and a new technology space that's really interesting. I'm not sure if I answered both your questions there well or not, or just one of them. **Mo Islam:** You actually not only did you answer those two questions, you also answered another question which I was going to ask, which was how do you want to be remembered. ### Unlimited Resources Scenario **Mo Islam:** If you had unlimited resources and no regulatory constraints—the second part's probably pretty important, no regulatory constraints—unlimited resources, what's a project that you'd be focused on right now? **Peter Beck:** To be honest with you, I'm living the dream. We're doing everything that I want to do. We have interplanetary missions, we have Neutron, we're growing quickly, we get to play in the most amazing projects and do the most amazing things, and work with the most incredible customers. Honestly, I'm living the dream. There's always a set of constraints you have to live within the dream, but really there's nothing I wake up in the morning wishing that I could do. I'm doing it. ### Things Peter is Keeping an Eye On **Mo Islam:** Just to end here, just a couple of prediction questions. First is, is there anything that you are seeing, a trend you're seeing or expect to see, that you feel like isn't being talked about enough in the industry? Maybe something that's unique to your perspective based on some of the things that you're surrounded by and you see? **Peter Beck:** I've been saying for years now, it's clear as a pane of glass to me—and I've said it in this interview—that the large space companies of the future are going to be blurry about what they look like. Are they a space company or are they a services company? I think Starlink has woken a lot of people up. For us, it was just so obvious. If you're a commercial comms company right now, I think you're doing a little bit of searching because this thing that's come in has just disrupted the entire comms industry. The Starlink satellite's a great satellite, sure, but actually the thing that's really disruptive here is just low cost and complete access to space. That is the most disruptive thing of all of this, and that's why Neutron's so important. Without having that access to space, you can have all the satellites you want sitting on the shop floor—the business models don't close. I've been talking about this for a long time. We're building this end-to-end space company. When we first started moving into the satellite industry, people said we're pivoting and started building satellites. It's like, well, it's a different business model, but no, this is all a grand strategy to end up as an end-to-end space company, because I think as we look back, those are going to be the real big companies. ### Date for Humans on Moon and Mars **Mo Islam:** Last question. Date for humans on moon and then humans on Mars—what do you think? **Peter Beck:** I think there's a high degree of probability that the next footprint on the moon will be a Chinese footprint, and then I think very shortly after that, America will have a return presence to the moon. I'm not particularly good at dates, so I would hate to put a date on it, but certainly within, you know, before the end of this decade. I think Mars is an unknown window at this point. With a new administration, there's clearly a focus, a much stronger focus on space, and Mars will be a part of that. So expect things to probably grow and accelerate within the space industry as a result. I think there's one other rocket CEO who's far better placed to answer that question than me. ### Conclusion **Mo Islam:** Well, Peter, thanks so much for being on the show. This is great. Thanks for giving us such a unique backdrop and for letting me ask those questions. Again, thanks so much. We'd love to have you back post-launch of Neutron. Till then. **Peter Beck:** My pleasure, and thanks for putting up with a last-minute, non-standard situation. Appreciate it. **Mo Islam:** Perfect. Thank you, sir.