NZ Herald
  • Home
  • Latest news
  • Herald NOW
  • Video
  • New Zealand
  • Sport
  • World
  • Business
  • Entertainment
  • Podcasts
  • Quizzes
  • Opinion
  • Lifestyle
  • Travel
  • Viva
  • Weather

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • New Zealand
    • All New Zealand
    • Crime
    • Politics
    • Education
    • Open Justice
    • Scam Update
  • Herald NOW
  • On The Up
  • World
    • All World
    • Australia
    • Asia
    • UK
    • United States
    • Middle East
    • Europe
    • Pacific
  • Business
    • All Business
    • MarketsSharesCurrencyCommoditiesStock TakesCrypto
    • Markets with Madison
    • Media Insider
    • Business analysis
    • Personal financeKiwiSaverInterest ratesTaxInvestment
    • EconomyInflationGDPOfficial cash rateEmployment
    • Small business
    • Business reportsMood of the BoardroomProject AucklandSustainable business and financeCapital markets reportAgribusiness reportInfrastructure reportDynamic business
    • Deloitte Top 200 Awards
    • CompaniesAged CareAgribusinessAirlinesBanking and financeConstructionEnergyFreight and logisticsHealthcareManufacturingMedia and MarketingRetailTelecommunicationsTourism
  • Opinion
    • All Opinion
    • Analysis
    • Editorials
    • Business analysis
    • Premium opinion
    • Letters to the editor
  • Politics
  • Sport
    • All Sport
    • OlympicsParalympics
    • RugbySuper RugbyNPCAll BlacksBlack FernsRugby sevensSchool rugby
    • CricketBlack CapsWhite Ferns
    • Racing
    • NetballSilver Ferns
    • LeagueWarriorsNRL
    • FootballWellington PhoenixAuckland FCAll WhitesFootball FernsEnglish Premier League
    • GolfNZ Open
    • MotorsportFormula 1
    • Boxing
    • UFC
    • BasketballNBABreakersTall BlacksTall Ferns
    • Tennis
    • Cycling
    • Athletics
    • SailingAmerica's CupSailGP
    • Rowing
  • Lifestyle
    • All Lifestyle
    • Viva - Food, fashion & beauty
    • Society Insider
    • Royals
    • Sex & relationships
    • Food & drinkRecipesRecipe collectionsRestaurant reviewsRestaurant bookings
    • Health & wellbeing
    • Fashion & beauty
    • Pets & animals
    • The Selection - Shop the trendsShop fashionShop beautyShop entertainmentShop giftsShop home & living
    • Milford's Investing Place
  • Entertainment
    • All Entertainment
    • TV
    • MoviesMovie reviews
    • MusicMusic reviews
    • BooksBook reviews
    • Culture
    • ReviewsBook reviewsMovie reviewsMusic reviewsRestaurant reviews
  • Travel
    • All Travel
    • News
    • New ZealandNorthlandAucklandWellingtonCanterburyOtago / QueenstownNelson-TasmanBest NZ beaches
    • International travelAustraliaPacific IslandsEuropeUKUSAAfricaAsia
    • Rail holidays
    • Cruise holidays
    • Ski holidays
    • Luxury travel
    • Adventure travel
  • Kāhu Māori news
  • Environment
    • All Environment
    • Our Green Future
  • Talanoa Pacific news
  • Property
    • All Property
    • Property Insider
    • Interest rates tracker
    • Residential property listings
    • Commercial property listings
  • Health
  • Technology
    • All Technology
    • AI
    • Social media
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
    • Opinion
    • Audio & podcasts
  • Weather forecasts
    • All Weather forecasts
    • Kaitaia
    • Whangārei
    • Dargaville
    • Auckland
    • Thames
    • Tauranga
    • Hamilton
    • Whakatāne
    • Rotorua
    • Tokoroa
    • Te Kuiti
    • Taumaranui
    • Taupō
    • Gisborne
    • New Plymouth
    • Napier
    • Hastings
    • Dannevirke
    • Whanganui
    • Palmerston North
    • Levin
    • Paraparaumu
    • Masterton
    • Wellington
    • Motueka
    • Nelson
    • Blenheim
    • Westport
    • Reefton
    • Kaikōura
    • Greymouth
    • Hokitika
    • Christchurch
    • Ashburton
    • Timaru
    • Wānaka
    • Oamaru
    • Queenstown
    • Dunedin
    • Gore
    • Invercargill
  • Meet the journalists
  • Promotions & competitions
  • OneRoof property listings
  • Driven car news

Puzzles & Quizzes

  • Puzzles
    • All Puzzles
    • Sudoku
    • Code Cracker
    • Crosswords
    • Cryptic crossword
    • Wordsearch
  • Quizzes
    • All Quizzes
    • Morning quiz
    • Afternoon quiz
    • Sports quiz

Regions

  • Northland
    • All Northland
    • Far North
    • Kaitaia
    • Kerikeri
    • Kaikohe
    • Bay of Islands
    • Whangarei
    • Dargaville
    • Kaipara
    • Mangawhai
  • Auckland
  • Waikato
    • All Waikato
    • Hamilton
    • Coromandel & Hauraki
    • Matamata & Piako
    • Cambridge
    • Te Awamutu
    • Tokoroa & South Waikato
    • Taupō & Tūrangi
  • Bay of Plenty
    • All Bay of Plenty
    • Katikati
    • Tauranga
    • Mount Maunganui
    • Pāpāmoa
    • Te Puke
    • Whakatāne
  • Rotorua
  • Hawke's Bay
    • All Hawke's Bay
    • Napier
    • Hastings
    • Havelock North
    • Central Hawke's Bay
    • Wairoa
  • Taranaki
    • All Taranaki
    • Stratford
    • New Plymouth
    • Hāwera
  • Manawatū - Whanganui
    • All Manawatū - Whanganui
    • Whanganui
    • Palmerston North
    • Manawatū
    • Tararua
    • Horowhenua
  • Wellington
    • All Wellington
    • Kapiti
    • Wairarapa
    • Upper Hutt
    • Lower Hutt
  • Nelson & Tasman
    • All Nelson & Tasman
    • Motueka
    • Nelson
    • Tasman
  • Marlborough
  • West Coast
  • Canterbury
    • All Canterbury
    • Kaikōura
    • Christchurch
    • Ashburton
    • Timaru
  • Otago
    • All Otago
    • Oamaru
    • Dunedin
    • Balclutha
    • Alexandra
    • Queenstown
    • Wanaka
  • Southland
    • All Southland
    • Invercargill
    • Gore
    • Stewart Island
  • Gisborne

Media

  • Video
    • All Video
    • NZ news video
    • Herald NOW
    • Business news video
    • Politics news video
    • Sport video
    • World news video
    • Lifestyle video
    • Entertainment video
    • Travel video
    • Markets with Madison
    • Kea Kids news
  • Podcasts
    • All Podcasts
    • The Front Page
    • On the Tiles
    • Ask me Anything
    • The Little Things
  • Cartoons
  • Photo galleries
  • Today's Paper - E-editions
  • Photo sales
  • Classifieds

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • Sunlive
  • ZM
  • The Hits
  • Coast
  • Radio Hauraki
  • The Alternative Commentary Collective
  • Gold
  • Flava
  • iHeart Radio
  • Hokonui
  • Radio Wanaka
  • iHeartCountry New Zealand
  • Restaurant Hub
  • NZME Events

SubscribeSign In
Advertisement
Advertise with NZME.
Home / Business

Peter Beck on how Rocket Lab will make money

Chris Keall
By Chris Keall
Technology Editor/Senior Business Writer·NZ Herald·
12 Nov, 2018 04:52 AM6 mins to read

Subscribe to listen

Access to Herald Premium articles require a Premium subscription. Subscribe now to listen.
Already a subscriber?  Sign in here

Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech.
‌
Save

    Share this article

    Reminder, this is a Premium article and requires a subscription to read.

Looking to the heavens, with one eye on the bottom line: Rocket Lab founder Peter Beck says his company will be cashflow-postive by the end of this year. Photo / File

Looking to the heavens, with one eye on the bottom line: Rocket Lab founder Peter Beck says his company will be cashflow-postive by the end of this year. Photo / File

Rocket Lab's maiden commercial launch on Sunday was a moment of pride for all New Zealanders, and pure Thunderbirds Are Go delight for geekier Kiwis as "It's Business Time" successfully launched a fleet of cube sats into low Earth orbit.

But heavyweight backers from Lockheed Martin to Sir Stephen Tindall - who have put US$148 million into the company - will now be looking for a return on their investment.

Founder Peter Beck doesn't shirk from that fact.

"We've not funded by any billionaires," the Aucklander says, in a nod to Space X's founder, the eccentric Elon Musk, whom Forbes values at US$22.5 billion, and Blue Origin founder Jeff Bezos (aka the planet's richest person), whose early-stage space venture Blue Origin is bankrolled by the US$141b personal fortune he has amassed through Amazon.

"We actually need to make money - and that has been a key focus from day one. It's Business Time is 'business time' in more meanings that you can imagine."

Advertisement
Advertise with NZME.

And the news on this front is good.

Beck won't give a line-by-line account of the privately-held company's financials, but "we'll come out of the end of this year cash-flow positive".

"It's a real credit to the team here that we can come out of such an intensive R&D period to cashflow positive so quickly."

Advertisement
Advertise with NZME.

The plan is for Rocket Lab's second commercial flight to launch in as soon as a fortnight, and Beck says so far everything's on track to meet that deadline - which would put his company ahead of its aggressive timeline to reach a monthly launch frequency by the end of this year, fortnightly by the end of next year and weekly by 2020.

It's part of the Kiwi-American company's plan to grab as much aerospace business as possible over the next four years - a period when various organisations want to launch 2600 satellites.

Discover more

Business

In pictures: Rocket Lab's giant new Auckland plant

12 Oct 12:22 AM
Business

Rocket Lab names site for first launchpad outside NZ

17 Oct 05:44 PM
Business

Competition for Rocket Lab as Virgin tests 'airborne launch pad'

27 Oct 10:09 PM
Opinion

Comment: CNN's annoying Rocket Lab report

12 Nov 08:37 PM

Some sixty per cent of them are small enough for Rocket Lab to lift into orbit - or more than US$3b worth of flights, allowing for some ride-sharing.

"That's not an estimate or including dreamers or companies in stealth mode, that's the actual pipeline," Beck says. "Whether there are enough customers is not one of the things that keeps me up at night."

There are many budding competitors to Rocket Lab (they include a Richard Branson effort that will launch rockets an "airborne platform" - or a modified Boeing 747).

But Beck says none of them is close to a commercial flight and capturing a slice of the multi-billion dollar market.

"The opportunity is huge here - and we are currently the only show in town. Yesterday we commenced full commercial operations so that's the new normal for the industry now. There is officially a launch vehicle on the market that's capable of delivering small-sat payloads into orbit."

Rocket Lab can put a 150kg satellite into low Earth orbit for US$5.7m - about a fifth of what it costs to put a heavier load into orbit with Space X, and a fraction of Nasa's US$150-300m.

Advertisement
Advertise with NZME.

Its success is partly down to Beck's brainpower, and the one-time Fisher & Paykel Appliance engineer's innovations in engine design and fuel (which are all self-taught; he never went to university).

But he also puts it down partly to process. He says while other rockets are custom-designed for each customer - including Space X's Falcon - the Electron rockets produced by his company's LA and Auckland plants are identical. Customers' satellites are attached to a plate, which is then attached to the standard rocket design, helping to keep costs low and timelines to months rather than years.

Smaller clients can also split the US$5.7m cost with a "ride-share" arrangement that can be booked online, almost like booking an Uber.

Beck says next year, there will be a ride-share flight about once a quarter to mop up smaller customers, but other flights will be each dedicated to a single larger satellite.

He says his company sells a launch service, not rockets. If a rocket fails, Rocket Lab will just keep trying until it has a successful launch and delivers a payload into orbit.

Rocket Lab's most recent funding round was in 2017, when it raised US$75m at a post-money valuation of more than $1b [UPDATE: on November 16, Rocket Lab said it had raised a further US$140m].

Beck says the company will seek to raise more funding.

"We're in a very capital-intensive business and we've got a couple of big projects to rollout next year."

Rocket Lab recently announced the site for its first launch pad outside New Zealand: Nasa's Wallops Launch Facility in the US state of Virginia. Beck says its now scouting for a site in the UK, with one in Asia to possibly follow - although he adds that its Mahia Peninsula facility will always be its highest-frequency launch facility by dint of its geography and our relatively empty skies and shipping lanes.

The company is also in full-on hiring mode, looking to add 180 (split evenly between NZ and the US) to its existing staff of around 350.

For all the expansion, Beck has no plans to move into larger rockets and challenge Space X's heavy-lifting lineup.

That means while Rocket Lab is capital-intensive, it's still has nothing on Space X's constant need for external capital raising. "They have to pull in half a billion in every six months," he says.

Rocket Lab will use different mechanisms to raise money, and a listing, at some point, is "under evaluation", Beck says.

But you get the impression he is enjoying life as the chief executive of a private company, which has seen most of its backers make repeat investments (beyond Lockheed and Sir Stephen. They include Khosla Ventures and The Data Collective - both based in Silicon Valley - and Bessemer Venture Partners. Beck won't comment on stakes, but concedes he now has a minority investment in Rocket Lab, which is has shifted its incorporation to the US).

"We're very lucky the investors we have onboard are not looking for a quick exit but rather to build a large company," he says.

Save

    Share this article

    Reminder, this is a Premium article and requires a subscription to read.

Latest from Business

Premium
Airlines

Pilot group to honour Erebus legacy with safety award

17 Jun 07:00 AM
Premium
Business

The NZ boardrooms where women buck gender pay gap trend

17 Jun 06:00 AM
Premium
Shares

Market close: NZX 50 down 0.4% as Israel-Iran conflict intensifies

17 Jun 05:48 AM

Audi offers a sporty spin on city driving with the A3 Sportback and S3 Sportback

sponsored
Advertisement
Advertise with NZME.

Latest from Business

Premium
Pilot group to honour Erebus legacy with safety award

Pilot group to honour Erebus legacy with safety award

17 Jun 07:00 AM

The industry faces challenges but hopes to bring newcomers and veterans together.

Premium
The NZ boardrooms where women buck gender pay gap trend

The NZ boardrooms where women buck gender pay gap trend

17 Jun 06:00 AM
Premium
Market close: NZX 50 down 0.4% as Israel-Iran conflict intensifies

Market close: NZX 50 down 0.4% as Israel-Iran conflict intensifies

17 Jun 05:48 AM
Median house prices down again, sales taking longer: monthly report

Median house prices down again, sales taking longer: monthly report

17 Jun 05:32 AM
Gold demand soars amid global turmoil
sponsored

Gold demand soars amid global turmoil

NZ Herald
  • About NZ Herald
  • Meet the journalists
  • Newsletters
  • Classifieds
  • Help & support
  • Contact us
  • House rules
  • Privacy Policy
  • Terms of use
  • Competition terms & conditions
  • Our use of AI
Subscriber Services
  • NZ Herald e-editions
  • Daily puzzles & quizzes
  • Manage your digital subscription
  • Manage your print subscription
  • Subscribe to the NZ Herald newspaper
  • Subscribe to Herald Premium
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • The New Zealand Herald
  • The Northland Age
  • The Northern Advocate
  • Waikato Herald
  • Bay of Plenty Times
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven Car Guide
  • iHeart Radio
  • Restaurant Hub
NZME
  • About NZME
  • NZME careers
  • Advertise with NZME
  • Digital self-service advertising
  • Book your classified ad
  • Photo sales
  • NZME Events
  • © Copyright 2025 NZME Publishing Limited
TOP