Sir Richard Branson’s space launch company Virgin Orbit has filed for Chapter 11 bankruptcy protection in the US. The move comes just fifteen months after the company completed a merger with a blank-check structure, and valued at over $3.7 billion.
The firm had unsuccessfully sought new financing, and had just laid off the majority of its staff. Its share price fell rapidly throughout 2021, and the company was last valued at just $65 million, a drastic drop from its Nasdaq debut. To this end, the firm has received a $31.6 million infusion from Branson’s Virgin Investment division to help maintain operations under the court protection of Chapter 11.
Virgin Orbit had a strong and timely vision for the launch market, which is expected to swell and experience a great deal of growth due to the potential for smaller satellites within the lower Earth orbit. While Elon Musk’s SpaceX has revolutionized access to space with its reusable Falcon rocket, Virgin Orbit aimed to offer unparalleled ‘horizontal’ launches from runways all over the world, utilizing a converted 747 superjumbo aircraft.
The company poured in over a billion dollars, split between equity and debt, with investors such as Boeing and the Emirati Sovereign Wealth Fund Mubadala, to create this system. However, they did not muster the revenue or pace of launches needed to take full advantage of this growing sector.
In Richard Branson’s personal statement, he expressed an immense amount of sadness for the situation, but was still proud of the business he’d created and held that he felt it “did important, impactful, and foundational work in the space field”.
Going forward, Virgin Orbit will need to find a buyer for its launching system, or will face the ultimately wind down of its operations. Clearly, Sir Richard Branson will continue to be a major force in the aerospace and defense field, notwithstanding the recent setback of his most recent business venture.