Careers at SpaceX
SpaceX’s mission is to push past mankind's current difficulties with space travel by lowering the costs and commercializing the process.
Entrepreneur and PayPal co-founder Elon Musk believed that humans should be actively exploring space – with the ultimate goal of enabling life on Mars and other planets. In 2001, in an effort to regain public interest in space, he came up with the idea for a project called “Mars Oasis”, in which a miniature greenhouse would be placed on Mars in order to study plant growth. However, he realized that such an initiative would be too expensive for NASA and that an inexpensive rocket was needed.
In 2002 Musk made a trip to Moscow to buy refurbished intercontinental ballistic missiles (ICBMs) that could transport the greenhouse. He met with manufacturer Kosmotras, which offered one rocket for $8 million. Musk felt this was too costly and returned to the U.S. On the trip back he reasoned that he could just start a rocket company himself. Performing some calculations, he determined that the raw materials for such a product represented only 3% of a rocket’s sale price.
Invigorated, Musk founded Space Exploration Technologies Corporation – better known as SpaceX. His goal was to create an inexpensive, reusable rocket that could make multiple space trips. He recruited rocket engineer Tom Mueller to work with him. They spent the next few years developing the product, called the Falcon 1 -- a reference to the Millennium Falcon in the movie “Star Wars”. The process was funded by a combination of investor funds and $100 million of his money.
In 2008, after three previous tries, the Falcon 1 went into orbit around the Earth -- becoming the first privately-funded, liquid-fueled rocket to accomplish this task. SpaceX began making the rocket available for commercial purposes, and in 2009 it carried its first successful payload, RazakSAT, into orbit. Falcon 1 was then retired in favor of Falcon 9, a new model. In 2010, Falcon 9 became the first private spacecraft to go into orbit and be successfully recovered. The firm was doing very well.
SpaceX has since built two more rockets, the Falcon Heavy and the Dragon, with both achieving milestones. The Dragon has delivered cargo to and from the International Space Station numerous times for NASA. Under a $1.6 billion contract with the agency, SpaceX will oversee at least 12 cargo resupply missions in the next few years. The company can now boast more than 70 planned launches on its manifest, representing more than $10 billion in contracts with NASA and private firms.
Business model of SpaceX
SpaceX has a niche market model, with a specialized customer segment. The company markets its offerings to public and private organizations that want to transport items to space. Its projects have included commercial satellite launch, space station resupply, and government national security missions. Specific clients have included OrbComm, the U.S. Air Force, and MDA Corporation.
SpaceX offers three primary value propositions: accessibility, performance, and brand/status.
The company has created accessibility by enabling travel to space for relatively inexpensive means. This has provided transport opportunities for many organizations seeking exploration.
The company has demonstrated strong performance. It has achieved numerous milestones, including the following:
- Having the first privately-funded, liquid-fueled rocket to reach orbit around Earth
- Being the first private company to successfully launch, orbit, and recover a spacecraft
- Being the first private firm to send a spacecraft to the International Space Station
- Being the first private firm to send a satellite into geosynchronous orbit
- Overseeing the first landing of a first stage orbital capable rocket
- Overseeing the first water landing of a first stage orbital capable rocket
The company has built a strong brand. As the first private company to actively explore space travel, it is well-established and well-known. It has gained further prominence through its association with Elon Musk, a high-profile entrepreneur who co-founded PayPal and founded Tesla.
SpaceX’s main channel is its business development team, through which it acquires most customers. The company promotes its offering on its website and through its social media pages.
SpaceX’s customer relationship is primarily of a dedicated personal assistance nature. The company works closely with clients as it oversees the launch, orbiting, and recovery of spacecraft.
SpaceX’s business model entails designing, manufacturing, and launching rockets and satellites.
SpaceX’s key partners are the suppliers who provide the parts for it to manufacture its spacecraft. The company has more than 3,000 of these partners, with 1,100 of them making weekly deliveries.
SpaceX’s main resource is its technology staff, which includes software, hardware, structural, and propulsion engineering employees. These employees work in its rocket development facility in McGregor, Texas; rocket testing facilities in Texas and New Mexico; launch facilities at Cape Canaveral Air Force Station, Vandenberg Air Force Base, and Kennedy Space Center; satellite development facility in Redmond, Washington; regional offices in Texas, Virginia, and Washington, D.C.; and headquarters in Hawthorne, California. As a startup, SpaceX has relied heavily on funding from outside parties, raising $1.25 billion from 11 investors as of January 2015.
SpaceX has a value-driven structure, aiming to provide a premium proposition through significant personal service and frequent product enhancements. Its biggest cost driver is likely cost of goods, a variable cost. Other major drivers are in the areas of research/development and sales/marketing, also fixed costs.
SpaceX has one revenue stream: sales of the rockets, satellites, and merchandise it manufactures. The Falcon 9 rocket costs $62 million. The Falcon Heavy rocket costs $90 million. Pricing for the Dragon rocket is not currently available. The company’s website includes a store where it sells SpaceX-branded T-shirts, outerwear and accessories with a wide range of prices.
info: Elon earned Bachelor’s degrees in Physics and Business at the University of Pennsylvania. He is the Chairman of electric car company Tesla and solar panel firm SolarCity, and previously co-founded and served as an executive at Internet firms PayPal and Zip2.
info: Ken earned a Bachelor of Engineering at the Stevens Institute of Technology, a Master of Engineering from Carnegie Mellon University, and an MBA from New Hampshire College. He previously acted as CIO of Broadcom and Rockwell Electronic Commerce.
info: Bret earned a B.S. in Accounting from the University of Southern California and an M.S. in Finance from San Diego State University. He previously served as VP, Corporate Controller, and Principal Accounting Officer of Broadcom and CFO of Mindspeed.
info: Gwynne earned Bachelor's and Master's degrees n Mechanical Engineering and Applied Mathematics from Northwestern University. She previously served as VP of Business Development at SpaceX and as a Chief Engineer at Aerospace Corporation.
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