From sending civilians to space to cutting the cost of space travel, SpaceX has set itself apart in the aerospace industry, making it rain for founder Elon Musk.
Analysts at the investment bank Morgan Stanley believe that business magnate Elon Musk could become the world’s first trillionaire. They suggest that while Musk might have earned his fortune from the electric car company Tesla, it is SpaceX that will make more money over time.
Musk has addressed the statement jokingly on Twitter. Replying to a tweet that read “Elon Musk is predicted to become the world’s first trillionaire, thanks to SpaceX,” Musk added “*in Dogecoin”. Jokes aside, Musk owns 48% of the over-US$100 billion company, which means that the growth of this company will certainly be a huge plus for him. Let’s fully understand the potential of SpaceX by looking at what sets it apart from other aerospace companies.
Technology solutions
You would have to be living under a rock to not have heard about SpaceX. The company has a knack for making its way into the news on a regular basis. The company has had many achievements, one of the biggest ones being that it was responsible for the world’s first reusable rocket, Falcon 9. With the reusable rocket, money spent on constantly rebuilding rocket hardware was spared. This has made space travel not just economical but also sustainable in terms of resource consumption.
Willingness to experiment (and even fail)
Much like other rockets, the ones built by SpaceX have also had their fair share of accidents. In 2015, one of SpaceX’s rockets broke apart during lift-off. However, the company has been proactive in finding solutions to each and every problem their rockets have encountered. Today, Falcon 9 is one of the most reliable rockets ever built and is the only way to get to the International Space Station (ISS) from the United States.
Similarly, the company has been experimenting with increasing accessibility of space travel. The company was responsible for the first all-civilian crew space mission. As a part of this mission, SpaceX sent four civilians to space on a three-day journey around Earth.
Unique business model
SpaceX is a pioneer in commercial space exploration technology. Right from the beginning, the company’s goal has been to cut costs on space travel. Not only have they focused on technological solutions to this effect, but they also charge significantly less than other aerospace companies, making them the best candidates for NASA contracts.
Although SpaceX’s profit margin is low, it uses its contracts to consistently improve upon its products. Their business model is to get contracts (even if at a lower profit margin) and use them as opportunities to learn and improve.
SpaceX will make Musk his next couple of billions by not just changing the face of space travel, but also by the tremendous potential the company has in other sectors. Starlink, the company’s proposed plan for a high speed-low latency internet network, is an example of its potential.
Morgan Stanley analyst Adam Jonas said that, “investors are beginning to appreciate the potentially wide-ranging use-cases for SpaceX’s reusable launch architecture across communications, transportation, [E]arth observation and other space-related domains.” Thus, the possibilities for SpaceX are truly endless, and only time will tell how the company will expand its avenues.
Header image courtesy of Unsplash
