Virgin Galactic has been a moonshot of a stock over the past month, up over 60%.
The Bezos, Musk and Branson billionaire space race is happening right now
Andy Serwer with Max Zahn
Yahoo Finance
January 18, 2020
Virgin Galactic Founder Sir Richard Branson demonstrates a spacewear system, designed for Virgin Galactic astronauts, at an event October 16, 2019 in Yonkers, New York. - At the event Virgin Galactic and Under Armour unveiled the worlds first exclusive spacewear system for private astronauts. (Photo by Don Emmert / AFP)
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Virgin Galactic Founder Sir Richard Branson demonstrates a spacewear system, designed for Virgin Galactic astronauts, at an event October 16, 2019 in Yonkers, New York. - At the event Virgin Galactic and Under Armour unveiled the worlds first exclusive spacewear system for private astronauts. (Photo by Don Emmert / AFP) (Photo by DON EMMERT/AFP via Getty Images)
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With a presidential election, the Summer Olympic Games in Tokyo and yes, Ludwig van Beethoven’s 250th birthday celebration, 2020 promises to be a humdinger of a year.
But also happening in 2020—if all systems are go—will be the beginning of regular U.S. space tourism flights, either by Richard Branson’s Virgin Galactic (ticker: SPCE) or Jeff Bezos’ Blue Origin or both. Also possibly coming this year are tourist trips to the International Space Station (ISS) on a craft built by Elon Musk’s SpaceX. (Boeing has a spaceship too, but that company might be otherwise occupied.)
So apologies to Donald, the International Olympic Committee (IOC) and Ludwig van, but commercial space travel could end up being the biggest damn thing to happen this year. In fact, I think it’s the beginning of a real game-changer for humanity.
If you’ve been following the space biz, you know that the ‘go year’ has been pushed back a number of times, but Ann Kim, aerospace banker and managing director of Silicon Valley Bank, is feeling it. “These companies are close. They wanted to get humans into space in 2019, but were not as successful in delivering promises as originally thought. 2020 is a good year to see that inflection point.”
It has been a long time coming. In fact these three companies are more or less of the same vintage. Bezos founded Blue Origin (named after Earth, the blue planet, as the place of origin), in 2000. SpaceX, which has colonizing Mars as its ultimate mission, was founded in 2002. And Branson started Virgin Galactic two years after that.
While you may snort at all this silly space stuff, it’s worth noting that three of the most successful entrepreneurs of our lifetimes have been working on space travel for a collective 54 years now. Remember, once upon a time folks laughed at online bookstores, electric cars and branded air travel too.
Yes, there is a bit of a space race going on, although this time it’s not Russia v. the U.S., it’s Branson v. Bezos, who are battling in the suborbital space (pun intended), with Musk as a competitor longer term on more ambitious projects.
Some play down the competitive aspects of the business though. “It’s not a race at all,” future Virgin Galactic passenger Namira Salim told Yahoo Finance’s The Final Round, “we all say that in the industry.” I think it’s safe to say there is room for all three. (Space is a big place, right?)
It’s important to remember that intermittent space tourism has been around for a while. Between 2001 and 2009, seven space tourists traveled to the International Space Station on a Russian Soyuz spacecraft. Dennis Tito was the first, remember him? Also top Microsoft exec Charles Simonyi made the trip. And British singer Sarah Brightman signed up but later canceled. The trips were arranged by a U.S. company, Space Adventures, and cost, gulp, $20 million a pop. But the Russians terminated the program and despite talk of restarting it, haven’t. In any event the Soyuz trips were always one-offs, where Virgin Galactic and Blue Origin aim to be scheduled operations and the first steps to more extensive programs.
Virgin Galactic has been a moonshot of a stock over the past month, up over 60%. Some of that might have to do with CEO George Whitesides telling CNBC recently that demand for tickets “keeps ticking up by a good chunk every month.” The company says it has sold tickets to more than 600 customers at around $250,000 per person. It froze ticket sales after a crash in 2014 killed one of its pilots. Virgin Galactic now says it may reopen sales later this year—and raise prices.
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