Virgin Orbit

California-based Virgin Orbit is a small satellite launch service company, which is part of Richard Branson’s Virgin Group and a spin-off of Virgin Galactic. The company began commercial service in 2021 and has already launched satellites into orbit through its LauncherOne rocket for a range of clients including those that are commercial, civil, national security, and international. The company flew 2 launches in 2021, carrying 19 satellites to space. 

Developed and built in Long Beach, California, the company’s LauncherOne rockets are air-launched (as opposed to the traditional ground launch) from a modified 747-400 carrier aircraft, known as cosmic girl, which serves as a reusable mobile launch pad. This enables Virgin Orbit to reach customers from all around the world, as any airport that can support a 747 can be used for the launch. The LauncherOne rockets are designed to carry small satellites weighing upto 1,100 lbs to space with the first three launches averaging USD 2.5 million in revenue per launch due to introductory pricing, which is expected to increase to USD 6 million–12 million in the near term. Its ability to launch rapidly and unannounced from anywhere to any orbit has significant value for national security. The company’s first-ever launch from the UK–dubbed Start Me Up–which was first announced in October 2022 , encountered a problem with its second stage ignition during its launch in January 2023 due to a single loose fuel filter , preventing the Launcher One rocket from reaching orbit and successfully completing its mission.

Key customers and partnerships

Virgin Orbit’s portfolio of customers includes commercial, government, international, and national security clients whose satellites were sent to space. The company has served NASA, US Department of Defense, and Royal Netherlands Air Force. In January 2022, NASA selected the company to provide future launch services through Venture-Class Acquisition of Dedicated Rideshare (VADR) missions with a five-year ordering period contract with a maximum total value of USD 300 million, which would be managed by the Launch Services Program at the agency’s Kennedy Space Center in Florida. In 2021, the company also signed its first agreements to launch abroad in support of the UK Space Agency and the Royal Air Force at Spaceport Cornwall.

The company has high demand from commercial customers and has added to a backlog with Astroscale, Spire, SwRI, with plans for 20 launches with ANA Holdings Inc., owners of Japan’s largest airline. Virgin Orbit has also entered into partnership with various companies including Horizon Technologies, SatRev, Hypersat, and Arqit and strategic supplier partnerships with Bigbear.AI and Redwire.

Funding and financials

The company recorded USD 7.3 million revenue in 2021 (up 92% YoY) due to its two successful launches during the period. Furthermore, Virgin Orbit has secured active contracts of ~USD 575.2 million of potential revenue out of which USD 151.5 million are binding agreements while the remaining are non-binding Memoranda of Understanding (MOUs) and Letters of Intent (LOIs). 

In August 2021, Virgin Orbit announced that it will go public through a SPAC deal at a valuation of USD 3.7 billion by combining with special purpose acquisition company NextGen Acquisition Corp. II. In December 2021, the company closed the deal and was listed on Nasdaq under the ticker VORB. Virgin Orbit raised USD 228 million in gross proceeds as part of the transaction and its private investment in public equity (PIPE) investors included Boeing, AE Industrial Partners, The Virgin Group Mubadala, and NexGen. The company also raised USD 250 million from Yorkville Advisors in a post-IPO equity round in March 2022. In February 2023 , the company raised USD 10 million from Virgin Investments Limited (VIL) in the form of senior secured convertible notes at an interest rate of 12%. The proceeds were to be used for working capital requirements. Shortly after, in March 2023, the company received another USD 5 million injection from VIL in the form of a senior secured convertible note carrying an interest rate of 16%, bringing the total infusions from VIL to USD 60 million to date.

In March 2023, Virgin Orbit permanently ceased operations –only two-weeks after it halted operations temporarily –as the company was unable to secure a funding lifeline to maintain business activity. As a part of this move, the company also laid off nearly 675 positions (~85% of all positions) across all departments, with severance payments totalling USD 8.8 million and another USD 6.5 million for outplacement services and regulatory compliance.